Blog Entry

NBA releases 2010-11 audited revenue figure

Posted on: July 22, 2011 5:28 pm
Edited on: July 23, 2011 12:36 pm
 
Posted by Royce Young

The NBA sent out a press release late Friday that included the 2010-11 season audit of all Basketball Related Income (BRI) and player compensation. Results: Holy mother of money.

The league says:
  • BRI increased by 4.8 percent from $3.643 billion in 2009-10 to $3.817 billion in 2010-11.
  • Total player compensation also increased by 4.8 percent from $2.076 billion in 2009-10 to $2.176 billion in 2010-11. This marks the sixth consecutive season that player compensation increased under the expired CBA.
  • Total player compensation equaled 57 percent of BRI.
  • The average player salary for the 2010-11 season was $5.15 million.
  • Over the six-year term of the expired CBA, the average player salary increased by a total of 16 percent.
What's this mean? Why did the league do this? The NBA wants you to see that while yeah, the league is making a crapton of money the system clearly needs fixing because player salaries have also gone way up. The NBA might be raking in some $3.8 billion, but if it lost money last season, then what does that say about the system?

That's the whole idea. But to fans and others, all they see is a dollar sign and the word "billion" behind it. It's also hard to ignore that revenues increased by 4.8 percent. The question the players have here, as always, is, "How in the world did your franchise lose money then? If you're paying us too much, run a better business!" That's essentially true in most ways and kind of hard to argue with. If I've got a small business and I'm operating with a $200,000 a year revenue stream but I hired all my employees and signed them to a bunch of five-year, $75,000 a year deals, I'd be kind of a moron, right?

Still, that doesn't tell the whole story. Player salaries have indeed skyrocketed up the ladder and while revenues are up, they aren't necessarily up enough. At least that's what the league contends.

Hench our little impasse here.

Regardless, owners clearly want to tug down that $5.15 million average salary to somewhere in the $3 million territory and players have already agreed to come down on the 57 percent of BRI figure. But even still, it's hard to look at this release -- which the league snuck out at 5 p.m. on a Friday -- and not see that revenues had risen for another consecutive year.

Don't we all just feel so bad for the league making $3.8 billion and the players that average $5.15 million a year? I know I do.
Category: NBA
Comments

Since: Jul 26, 2011
Posted on: July 26, 2011 2:33 pm
 

NBA releases 2010-11 audited revenue figure

This is not a labor struggle and the volatile quotient in the mix is not the players, "labor", or "rights" it is all about a concentrated Green, the color of money.
30 business owners (30) pay 100% of the salaries, benefits to 100% of the players.
10 business owners (sports agencies) control 70% of the players and have negotiated over ONE Billion in NBA contracts for those 240 players or about 50% of what the NBA owners pay out.
30% vote is required to decertify the union (130 players).
4 business owners (sports agencies) control enough players to get 138 votes to de-certify.

The agents want a bigger piece of the NBA income  because it is their only path to growth/profits since the NBA is not expanding....and their only other means is to negotiate sponsorship contracts for their players.  The power agents actually sit on a NBAPA  "Advisory" Board....and should be thrown off.
The role of players agents in this "conflict" is inappropriate - they will not take the higher ground, unless the water is rising and the bank is on the hill. Since some of their clients are fabulous players, but may not be financial wizards and have paid attention in class.....the players rely on their agents for advice on many levels, ----that advice is usually all about money (and keeping your nose clean so you don't screw up your sponsorships),----- and not necessarily what is good for the game and the fans.

If you do the math....which I did quite by mistake while looking for something else,.........it is clear that this is a conflict between 10 sports agents and 30 NBA owners, not the 435 NBA players, and even the Union is being marginalized by the power agents........ it is clearly not about what is good for the sport.....and the ever loyal fans.
 



Since: Jul 26, 2011
Posted on: July 26, 2011 2:20 pm
 

NBA releases 2010-11 audited revenue figure




Since: Jun 25, 2009
Posted on: July 24, 2011 10:48 pm
 

NBA releases 2010-11 audited revenue figure

That 16% increase represents more than a $500,000 increase in actual dollars. In short, the average player's raise over the last CBA is more than the average person household makes in about a decade. The system is broken.

Nice post but I made that little correction for a reason. The average person or worker in the U.S doesn't make 50 thousand dollars per year, that number is closer to what the average household makes.   Husband and wife teams both working full time jobs rarely combine to gross 100 thousand dollars per year or 50 thousand dollars each.   NBA players have been living in fantasy land for a very long time, it's about time the owners bring them back to earth.  The only obstacle for NBA owners is the players average as been so high for so long they SHOULD be able to comfortably sit out a season and not be terribly hurt by a lockout, unlike NFL or NHL players that don't come close to approaching a 5 million dollar average.  But considering the NBA is losing as much money as they are losing it's not going to be too hard for the owners to hold out, and with their main businesses in tact and doing well for the most part outside of the NBA the owners will be fine and would be ok if the NBA died forever.

This is going to be a very long battle..... I can't imagine a lockout being avoided.... 



Since: Mar 15, 2008
Posted on: July 24, 2011 12:07 pm
 

NBA releases 2010-11 audited revenue figure

Honestly, who cares about the NBA lockout.  As long as football is in this year, that's all that matters.



Since: Aug 25, 2006
Posted on: July 23, 2011 1:06 pm
 

NBA releases 2010-11 audited revenue figure

getting rid of guaranteed contracts is the only thing that will help the nba



Since: Dec 5, 2006
Posted on: July 23, 2011 3:10 am
 

NBA releases 2010-11 audited revenue figure

There are several misconceptions about the NBA teams and the player salaries. First, the competitive teams will spend every nickel they need to win. For Dallas that is a ton. Ditto Lakers. Ditto Celtics. Even San Antonio last year paid luxury tax. So pending money to the legal limit is pretty typical of big market clubs. That money is simply not available to the small market clubs (and for the record San Antonio is a big market.) Which is why the Hornets with one of the best players in the league in Chris Paul are not going to win the championship. Blaming stupid owners only works if you are not a fan of one of those teams or a player happily banking the money.

A general rule of thumb in business, even an entertainment business is to keep labor (total) under 40% of revenues. In the NBA that has risen to 57% under the expiring contract during which the owners have lost $1.8 billion dollars. The total revenue means nothing if the net is a loss. The increase year to year means nothing if there is a loss every year. The players speak out that the owners want to be guaranteed a profit. That is inaccurate. The owners want to be guaranteed to have the opportunity for profit. Some with bad management still might lose in a particular year. But not 22 of 30, Most will earn a profit and that profit represents a return on the $300-400 million that owner has invested in his team. Would you put your money in a bank which took 10% each year from your account and returned you nothing? Neither would I,

This is not about feeling bad for anyone. A rookie drafted in the first round will get more in his 4 year initial contract than most of us will earn in a lifetime. The owners did a bad deal for the last CBA. Don't expect them to repeat it even if it takes a year to get the player to begin to bargain. Sad that we likely will miss a season. Unless the CBA is much closer to the owners' expectation than the players' expectations the next CBA might mean the end of the league. That is why the stakes are this high for the owners.



Since: Mar 10, 2007
Posted on: July 22, 2011 9:51 pm
 

NBA releases 2010-11 audited revenue figure

Yeah, it's not much if you aren't making jack squat!  But if you are making millions that 3% is pretty huge!
There are a lot of bad contracts out there and a lot of stupid people paying big money for bad players.




Since: Mar 8, 2011
Posted on: July 22, 2011 9:51 pm
 

NBA releases 2010-11 audited revenue figure

That 16% increase represents more than a $500,000 increase in actual dollars. In short, the average player's raise over the last CBA is more than the average person makes in about a decade. The system is broken.



Since: Jun 7, 2008
Posted on: July 22, 2011 7:32 pm
 

NBA releases 2010-11 audited revenue figure

16% increase over six years is less than 3% a year which is not much. You have to expect some growth unless of course your a public school teacher!


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