Blog Entry

Did Al Jefferson cause the lockout?

Posted on: August 1, 2011 2:47 pm
 
By Matt Moore

When Carlos Boozer's time with the Utah Jazz mercifully came to an end last summer, the Jazz had a number of options with what they wanted to do. They could pursue some free agents to fill in the blanks and plan for the future. They could hoard the cash and wait for a rainy day. Or they could make a trade to acquire a quality player.

The Jazz gambled on the latter, acquiring Al Jefferson for pieces to pair with Deron Williams. The Jazz started off lookings pretty solid, a near-guaranteed playoff team. They beat the Heat!

Then the wheels fell off. Then the bottom dropped out. Then the wagon caught fire and flew off a cliff and everyone died. And that's how we got a lockout.

The end.

Okay, not really. Let me explain, though. From the Salt Lake Tribune:
The No. 11 highest paying team on the planet, according to Harris? The Jazz, who shelled out an average of $5.8 million per player and had a total payroll of about $75 million.

“The fact that the Jazz are 11 is … kind of counterintuitive,” Harris said.

The Jazz declined to comment for this story. But Chief Executive Officer Greg Miller acknowledged in April that Utah rolled the dice during 2010-11 and lost “quite a bit” of money, while General Manager Kevin O’Connor has often praised the Miller family’s willingness to spend what it takes to compete in the modern NBA.
via Utah Jazz nearly topped the world in average payroll | The Salt Lake Tribune

So the Jazz pumped more money into the Jazz than the season prior. Sure, but it was only $3 million more. (The Jazz paid out $71.9 million in 2009-2010.) That couldn't have made that much of a difference, could it? 

Well, when a move goes awry like that, the effects start to trickle down.  During the season, interest dwindles (along with folks not coming out of principled loyalty to Jerry Sloan),which affects ticket sales, sponsorship money, merchandising, and all other sources of revenue (many if not all of which are included in the BRI-- Basketball Related Income --  the split of which is being debated in these CBA talks). The Jazz failed to make the playoffs, which meant the Jazz lost all the revenue from their playoff participation, which they obviously had to be counting on. All of this in an ongoing recession which sees everyone evaluating where their money is going. So now you've got the crux of the issue. 

Of course Al Jefferson didn't create the lockout. But the Jazz' situation around their decision to invest in Jefferson (right as it seemed at the time) speaks to the complex elements in play that go beyond "the system's broken." It's not teams that spend a lot which is hurting the league outright. It's teams that spend a lot and don't create enough revenue to cover its investment. It's also in part teams which don't spend a lot and then lose a lot. But what's the biggest factor, there? Teams which make certain decisions which either don't pan out off of huge investments, or don't create revenue because there has been no real drive to do so. You can't just cut spending while still losing income and expect to profit. That's not really a salient business model for these times. 

So when we talk about how the system is "broken," we're really talking about how the system creates catastrophic endings for perilous decision making. This doesn't mean that the entire model is flawed, it means that two things need to simultaneously occur: teams ability to hold onto more revenue in the split needs to be assured (which the NBPA has been amiable to), and teams need to exercise better business practices to increase revenue and not put themselves in a position to fail, then complain when they fail. Al Jefferson seemed like a great move at the time, but it wound up not working out. That's part of business. But if Jefferson gets more in sync with the system and flourishes next to Devin Harris and the next wave of Jazz players, it could wind up being good in the long run. And in those years, the Jazz will cover their losses and pull profit. 

NBA teams shouldn't face economic disaster whenever they make a bad signing or trade. And the Jazz should be encouraged as a small-market team that was willing to spend. But this is the cost of it being a free market, and allowing for competition. We don't want everyone assured of equal success. That provides no incentive for improvement or innovation. And the last thing we need is a fleet of Donald Sterlings walking around. 

Comments

Since: Feb 1, 2009
Posted on: August 2, 2011 11:22 am
 

Did Al Jefferson cause the lockout?

One Donald Sterling is too much.  NBPA should negotiate his removal from the league as part of the new CBA.



Since: Apr 27, 2011
Posted on: August 2, 2011 10:59 am
 

Did Al Jefferson cause the lockout?

The cause of the lockout is self serving greed and unwillingness to compromise. Sounds very simillar to what's happening in wasgington  the last couple of weeks doesn't it? Spending more money is not the answer. Spending has to be brought under control not only in D C but here in the NBA. Both sides need to change their attitudes, but their self serving greed aside and compromise. Make moves that is gonna be beneficial for the league.
I'll tell you what swung it in football. The networks and sponserships threatened to pull out and take their money with them. When this happened both sides came off their high horse and got a deal in place. I laugh when i hear bob kraft take credit for ending the strike. Untill a simillar threat is made to the NBA, an end to this lockout is nowhere in sight.



Since: Feb 22, 2010
Posted on: August 2, 2011 10:59 am
 

Did Al Jefferson cause the lockout?

The Utah Jazz suck in all ways. Stern should do EVERYONE a favor and get rid of the Jazz franchise.



Since: Mar 26, 2011
Posted on: August 2, 2011 1:34 am
 

Did Al Jefferson cause the lockout?

Actually the first thing we need is a fleet on Donald Sterlings around. He makes money under the current system even though his team is crap. Doesn't Stern want to guarantee a profit for his owners regardless of what happens? Well, Donald is doing it under the current system. David should point the owners to Donald and we could have avoid this whole mess.


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