The Business of Basketball

The Business of Basketball

It originally appeared as part Dealbook newspaper On December 24, 2020. To sign up, Click here.

The convergence of racial justice protests, an epidemic that decimated the crowd on arenas and a fast-paced industry on live sports presents an opportune moment to tell the story of the NBA’s emergence as a cultural and economic force, As some new books try to do. Its new season, its 75th, too Started this week.

In 1976, when the league subscribed to its rival, the American Basketball Association, the game was viewed as a minor game with relatively few TV games. CBS, which was then the authority, regular broadcast games on tape delay to avoid conflicts with popular series such as “Dallas” and “The Dukes of Hazard”. Today, it would be unimaginable for Turner Broadcasting and ESPN under him $ 24 billion rights deal It runs from the 2024-25 season and is almost triple the payout under the previous arrangement.

Although the NFL dominates national rights revenue and viewership, the NBA has had far more success internationally. And culturally, the basketball league has long played a role in music, fashion and beyond. The contrast between their initial embrace of the Black Lives Matter movement with the hostile approach of the NFL reflected the different demographics of the players – athletes in both leagues are highly black – but Management and ownership group.

The development of the NBA in its central role in media economics and social activism has important implications for business and politics. It makes the history of journalist Pete Crotto, “From Hang Time to Prime Time: Business, Entertainment and the Birth of the Modern NBA., Timely but frustrating.

To make a point about the mainstream relevance of basketball, the book opens with former LA Laker Derek Fisher’s 2017 performance on “Dancing with the Stars”, but there are many better examples. Lack of access to figures such as former NBA commissioner David Stern may have driven Mr. Crato’s choice, Who died this year, Or stars like Larry Bird, Magic Johnson and Michael Jordan. Mr. Stern’s Innovative strategy Uncovering personal personalities (and in the case of rivalry, Bird & Magic) created more interest in the game, while Mr. Jordan’s personal partnership with Nike took the NBA’s ambitions to another level.

There are moments of “hang time to prime time”. The differences in the styles and cultures of the two basketball leagues reflect the broader social tensions that are well in Mr Crato documents. Institutional resistance to jumping shots and slam docs is placed in their rightful, racist context, with an ugly fight to start a three-point shot in 1979.

The moment when the players ‘union saw the battered books of the NBA and agreed to a salary cap “to save owners from financial self-harm and save players’ jobs”. And the symbiotic relationship between rap music and NBA is lovingly detailed.

Yet Mr. Crotto ended its history around 1990, even though it was not until 1993, when Rupert Murdoch’s fledgling Fox TV network CBS for football rights, That the unfit increase in sports rights deals took off. And the media industry has never recovered.

Joshua Mendelsohn’s more successful cover of a similar period “The Cap: How Larry Fleischer and David Stern Produce the Modern NBA. “Although the 1983 agreement with the players’ union focused on the drama and dynamics that made the NBA the first major league to implement both salary cap and share revenue, Mr. Mendelsohn manages to highlight several features that Still separating the league. .

Many expected the epidemic to be reinforced by the continued increase in the price of sports media rights. But when Turner announced Record-setting multibillion-dollar extension In the summer of this year of its Major League Baseball, it was clear that the dynamics were more complex. With the boom in cord-cutting, pay-TV companies have felt a greater need to incorporate live sports. When Mr. Crotto’s story ends, less than 25 percent of the top-rated shows in any given year had live sports. Today it is close to 90 percent.

NBA players and officials’ ability to play an outside role in response to George Floyd’s murder reflects the league’s growth Economic and social importance. Understanding how it has been able to secure so much cultural capital – and then use it so much more effectively than many other leagues – is worth noting because the sports industry has its relevance in a post-epidemic world holds on.

Jonathan A. Knee is a professor of professional practice at Columbia Business School and senior advisor to Evercore. His next book, “The Platform Deletion: Who Wins and Who Loses in the Age of Tech Titans,” is scheduled to be released in September 2021.



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