Blog Entry

Lockout Timeline: How we got here

Posted on: July 2, 2011 1:24 pm
Edited on: July 2, 2011 2:36 pm
Posted by Matt Moore

How did we get here? How could things have gotten this badly this quickly? Didn't we just have a CBA agreement in 2005? Why didn't talks start sooner?

These are the questions we ask ourselves as the NBA begins its second lockout in 12 years this weekend. To help us understand how we got here, in contrast to Ken Berger's work on where we're headed, we present this timeline of relevant CBA dates. This is not a complete listing of every development, but hopefully provides some context of how we got from a stable and happy NBA, to one which may not play another game until fall of 2012.

January 20th, 1999: The NBA lockout ends after nearly seven months of non-talks. The two sides had been locked in bitter negotiations and went 36 days before engaging in the first bargaining session after the lockout. In a negotiation considered a win for the owners, the rookie scale was introduced along with the mid-level and veteran exceptions.

June 2nd, 2005: The NBA and NBPA come to an agreement on a new CBA, avoiding a lockout for the second time in six years. Under the new agreement, max contracts are shortened and raises curtailed.

July 22, 2005: The NHL owners' contingent secures a monumental victory over the NHLPA after a year-long lockout, securing a hard cap and keeping revenue sharing off the table. This has two effects on the NBA ownership. One, they see that a league can implement a hard cap in the modern era if its willing to go the distance. Two, NBA team owners who also own stakes in NHL franchises are convinced that a lockout, regardless of how long it takes, is worth it if they are able to secure changes for guaranteed profitability.

February 15th, 2009: In light of an ever-worsening economic downturn, Billy Hunter and David Stern appear at a joint press conference during All-Star Weekend in Phoenix and reveal they are in talks to reopen the collective bargaining agreement. At the press conference, both sides make it clear they are looking to get out in front of the expiration of the current deal in 2011.

Hunter: "We all understand that we live and benefit from the success of the NBA. The last thing we want to do is see it lose its vitality. We will do everything possible to reach a deal.

Whether or not that means we will reopen before the expiration of the current contract's conclusion is another question. But I can say to you that we are anxious to reach a deal."

Stern: "Just to talk about frameworks and understandings and say when we get to the last day and then it is either one side or the other, it leads to bad things."

The two sides were aware, even at that point, of how far apart they were, and vowed to work to start negotiations, substantitive negotiations, to avoid the question of a labor stoppage coming down to right before the expiration of the CBA in 2011. This is more than two years before the expiration date.

Substantive negotiations do not begin until May of 2011.

More on NBA Lockout
Ken Berger Ken Berger
Congratulations, NBA owners, you got what you wanted. Read >>
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February 19th, 2009: The New York Times speaks with former agent David Falk in advance of his book release, who makes bold and severe statements about the upcoming talks. Falk becomes one of the first to publicly forcast the owners' push for a hard cap.

“I think it’s going to be very, very extreme,” Falk said, “because I think that the times are extreme.”

February 27th, 2009: The AP reports that the NBA has lined up $200 million in loans to teams facing financial hardship during the economic crisis.

March 8th, 2009: ESPN and the Star-Tribune report that Glen Taylor, owner of the Minnesota Timberwolves, along with then-head-coach Kevin McHale were "rebuked" by the league office for comments made about the labor agreement. Most notably, McHale provided the first look at just how severe of changes to the existing agreement the owners would be looking for in negotiations, saying how the players should prepare for "major changes."

The league then authored a memo, according to reports, instructing teams not to make "any unauthorized statements" regarding the CBA, nor to speak with any player regarding the CBA or relevant discussions thereof.

March 20th 2009: Stern tells ESPN that he and Hunter have agreed to begin "substantive discussions, perhaps as early as May" in advance of the CBA's 2011 expiration. Notably, Stern says that when the current deal expires, it will not be "owners taking a hard line, it's going to be [both sides] dealing with new financial realities.

The owners will not offer a formal proposal until January of 2010, nearly 11 months later.

September 18th, 2009: The NBA officials' representative in the midst of a lockout of referees claims that NBA management received raises during the financial crisis the league has used to illustrate the need for overhauls of both the officials' and players' CBA. The referees' lockout is later resolved in what is considered another win for the owners.

December 18th, 2009: Ken Berger of reports that the league and players will meet over All-Star Weekend in Dallas with the first official proposals to be exchanged. It will have been a year since the Hunter-Stern presser vowing to proceed with negotiations early. Both sides continue to say the last thing they want is a lockout.

January 29th, 2010: The first substantive signs that the negotiations will become bitter and that the owners plan to take a hard line come to light as Berger reports that the owners' position is one of "(the players) need us more than we need them." Berger reports that the owners are "unified" and "determined to crush the union."

February 12th, 2010: Both sides realize after the first exchange of proposals just how far apart they are. Billy Hunter says afterwards that the owners actually pulled their proposal because it was so extreme. The terms "heated" and "contentious" are used,  Berger reports. It is the first indication how nasty this will become.

February 13th, 2010: Stern speaks at All-Star Weekend. Stern ridicules the assertion that the owners' proposal was "taken off the table." Later reports reveal how severe the owners' initial proposal was. Instead of considering this the extreme measure as an opening to a negotiation, the league represents this as the cold hard truth of what to expect in negotiations. The word lockout starts being bandied about.

July 2nd, 2010: Berger reports that the players provide their first counter-proposal to ownership, five months after the owners' proposal at All-Star Weekend. The players' proposal not only lacks the substantive changes suggested by the owners in their initial proposal, but in fact seeks to provide more flexibility and earning potential for players. Even as an opening offer to set the marks for the negotiation, it's unrealistic at best.

We are inside of a year remaining in the CBA. The owners will not respond to the proposal in kind for over nine months.

August 12th, 2010: Star players become involved in the talks for the first time since All-Star Weekend, but while the tenor of the conversation is improved, there is still a "gulf, not a gap" an executive tells Berger.

Notably, the players' association makes its first concession in regards to the total money spent on salaries. This is important as it sets the tone for the players being more willing to compromise, while the owners remain solid in their initial positions. This will later seemingly provide ammunition for the owners to believe they can eventually get the union to cave, if drastic measures are implemented.

October 21st, 2010: The league makes it known how severe their desired changes are, giving the estimate of $750 to $800 million in reduced salaries for the players. Everything is on the table for them, from contraction to revenue sharing, but the league makes its expectations crystal clear.

November 14th, 2010: Ken Berger of reports of upcoming meetings scheduled for November 18th, described as "two-on-two" sessions with the heaviest hitters, involving Stern, Adam Silver, Hunter, and Derek Fisher. The hope is that smaller meetings will create more substantive progress.

March 30th, 2011: Ken Berger of reports that the NBA has sent financial data from the teams for the 2009-2010 season to the NBPA. The disclosures reveal substantial losses in how they are calculated. The players' association will later deny the accuracy of the data and the conclusions gathered from it.

April, 2011: Ownership finally provides another formal proposal. It has been nine months since the players' last proposal.

June 8th, 2011: Players say there have been no changes at all in the owners' demands. 

June 21st, 2011: The owners' latest proposal seems like a compromise, moving away from a hard-cap to a "flex-cap" and softening their position on the BRI split, slightly. Players feel these measures are red herrings. 

June 22nd, 2011: Hunter tells reporters that the owners demands "can't be met."

June 28th, 2011: The owners and players agree to one final meeting, hours before a lockout. It will have been two and a half years since talks began at All-Star 20009.

June 30th, 2011: Owners notify players that the two sides are too far apart. The lockout begins at 12:01 a.m. EST, Friday, July 1st, 2011.

Since: Jan 28, 2011
Posted on: July 6, 2011 4:20 pm

Lockout Timeline: How we got here

When MLB went on strike and we lost the World Series, I turned my TV off and never turned back. Many of my baseball friends have done the same, and a quick look at the empty stands proves the point. If the NBA continues this foolishness, I will be absent when the millionaires begin tossing balls through hoops, and find something else to do with my life. Many, many more will follow and the goose that laid tha golden egg will have died.

Since: Aug 8, 2008
Posted on: July 4, 2011 11:42 am

Lockout Timeline: How we got here

Funny that you say Durant is a draw, but you don't list OKC in the list of cities that shouldn't have a team. You could eliminate all but Boston, Philly, NY (Knicks only), Dalllas, Houston, Chicago, LA (Lakers only), and either DC or Atlanta, have a 8 team league, and pack the rosters with all stars.

The reason they don't do that is the incremental revenue. They should still be able to make money in Memphis and OKC because more teams = more games = more television = more opportunity for advertising sales. True that the Thunder don't make as much as the Lakers, but they play each other a few times a year and contribute to overall league revenues.

If you really want to talk about change, start talking about contraction and how you would do it. When are stadium contracts up? Kings should be up soon. When the contract is up, the NBA should fold the team. Owners or the league pays a franchise fee back to the Maloofs and the Maloofs can sell off their players to the rest of the league to recover more of their investment. Or hold a dispersal draft. I hope that there is a contraction plan put in place soon to put teams like Memphis and New Orleans on notice.    &nbs

Since: Jul 2, 2011
Posted on: July 4, 2011 2:56 am

Lockout Timeline: How we got here

I posted as a celebration to the possibility of not having Sportscenter devoted to oversized people with oversized egos trying to take on opponents 1 on 5 with their undersized brains lol. I do like basketball, when it was a team sport about 25 years ago.

Since: Jul 9, 2010
Posted on: July 3, 2011 12:43 pm

Lockout Timeline: How we got here

Wow there are some uneducated so NBA fans posting here. The players draw the fans not so much the teams except for the lakers and celtics. Lebron James, dwade, Kobe, Durant, carmelo, they bring the fans, not the clippers or Charlotte. Revenue sharing is the biggest problem where teams split a percentage of ticket sales per game. The NFL is 60/40, where the NBA is like 75/25. There are only a hand full teams that very profitable, the lakers, heat, Dallas, celtics, Knicks, bulls, and a few others that's it. In reality Memphis should not a team neither should Toronto or new Orleans. These small market teams are what's killing the NBA.

Since: Apr 7, 2009
Posted on: July 3, 2011 9:16 am

Lockout Timeline: How we got here

Both sides are at fault here but in my opinion the owners need to figure this out. There are only 12-15 guys a team with only a handful making the big bucks. They have 41 home games a year to make revenue plus tv contracts, merchandise, food, etc. Call the NBA what you want but these players have a remarkable talent and are nothing less than freaks of nature. They dont just show up to their game every night and collect their pay check. I gaurentee every single NBA player puts in double the amount of time in their profession and the average worker. I truly believe these guys earn their paychecks and without them there would be no NBA. We can go watch college and see how sad that has become.

Since: Jun 5, 2011
Posted on: July 3, 2011 8:25 am

Greedy players and agents

The owners are right on this one.  The players need a reality check.  They aren't worth the salaries the current system has produced for them.  Players and agents have caused a disconnect by causing operating costs that are pricing the average fan out of the games.  The NBA is rapidly becoming a crappy investment where billionaires have a de facto contest to see how much money they can lose on a crappy product.  

Since: Mar 29, 2007
Posted on: July 3, 2011 1:15 am

Lockout Timeline: How we got here

I think we need to step back and look at the bigger picture. If we have a work stoppage in the NBA, does anyone realize all of the collateral damage this may cause ? Just imagine ESPN not being able to show any in game " dunks" anymore. No confrontations, no hot-doggin, no chest thumpin. How will the players be able to afford their toys ? Imagine the repossessions of all of those Escaldes,Mercedez and other high priced sports cars. What about the Bling-Bling Dealers? How will they cope knowing that the Boyz can’t afford anymore “ gold “ and may even have to pawn their glitterati ? Who will support the strip clubs at the various NBA cities now ? All those hotties not being able to offer those dudes the latest lap dance. What about the lack of Crystal sales ? How can the casinos offer them any markers knowing that they have no income coming in ? Who’s going to make all of those child support payments when they’re unemployment checks barely cover the gasoline for their rides?. I guess Phil Jackson and Shaq O’Neal picked a great time to retire from the profession.

Since: Jan 16, 2009
Posted on: July 3, 2011 12:00 am

Lockout Timeline: How we got here

Bye NBA Bye to NFL keep it real watch real sports like the NHL and CFL!

Since: Dec 5, 2006
Posted on: July 2, 2011 10:27 pm

Lockout Timeline: How we got here

For some of the commenters, I am not sure why you comment here if you really don't care about the NBA. This is a really good article because, unlike many of the current media stories, it presents the facts without proclaiming a judgment. The system is broken. The system allows for most of the money to be spent on, frankly, inferior players. When Jerome James can get over $29M over five years for playing a total of 694 minutes ($2.5M per hour) it demonstrates my point. Sadly James is not alone in being worth far less to his teams than he was paid.

The loss by 22 teams and league-wide over $300M also indicates a situation that cannot continue. This is called killing the golden goose. Players have been completely deaf to the realities of the league. This is not about billionaires vs millionaires. The owners derived their income from other industries. They know that return on investment (ROI) and risk are the two significant factors in selecting investments. They have an average of about $350M invested in their team (in most cases paying interest to third parties for a significant chunk of that investment.) Expectations of $35M average before income taxes would be reasonable. Instead they lose $10M on average. This is where the numbers come from when the NBA talks about reducing labor costs.

Are there other costs the teams can reduce? Yes but they are not significant compared with labor costs to players. Chartered flights, luxury hotels, facility scheduling etc. can all be tweaked and it will not change the above explained deficit. What is clear from this timeline is that the players have refused to take this seriously, trusting that they can turn the tide of fans against the owners and make the cave. They may have miscalculated. These owners appear to be determined to get labor costs under control (as every business must to survive). Do you think you can get your boss to guarantee 57% of revenues to be paid out in salaries? Neither do I. The sooner we speak out as fans and call the union on its bull-headed obstinacy, the sooner we can return to basketball. Hopefully that will be July 2011 and not July 2012.

Since: Nov 4, 2009
Posted on: July 2, 2011 8:12 pm

Lockout Timeline: How we got here

bitter-ass, whiny-ass, complainin-ass, mafucka

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