David Stern has turned the NBA into a moneymaking
machine since he took it over thirty years ago. In 1983, NBA playoff games were
televised on a tape delay, but now they are broadcast live in 215 countries
worldwide. The global interest in basketball has skyrocketed in part to Stern’s
new idea of individual player marketing. The iconic players in the league are
what generate cash and a greater fan base. Players like Kobe Bryant, LeBron
James, Kevin Durant, Carmelo Anthony, and Rajon Rondo are treated like celebrities
in the league ( Badenhausen). Star players generate revenue in basketball
because there are only five starting players on the team and a handful of bench
players. With such a smaller team, the impact that one player has on a team is
enormous. When LeBron James played for the Cleveland Cavaliers, he brought the
team to new heights by himself. When he went to Miami, with the help of two
other star players, Dwyane Wade and Chris Bosh, the team is close to impossible
to stop. The point to be made is that a star player in another sport such as
football where you can have up to 22 starting players or baseball with nine men
out in the field, will not make the impact of a star celebrity basketball
player. Why do you think star players in the NBA generate so much interest in
the sport rather than the teams as a whole?
Other factors play into the success that the New York Knicks and Los Angeles
Lakers have seen in the NBA. The New York Knicks have been the NBA’s most
valuable team for the second year in a row and worth over a billion dollars
($1.4 billion). TV Ratings and renovations to Madison Square Garden have
brought the Knicks to great revenues, even without the team performing too
great on the court. If you think about a team’s fan base and how many viewers
they have for each game, it is easy to fathom the reasons why Los Angeles and
New York do so well in the sports industry. New York as a city has two football
teams (the Giants and the Jets), two baseball teams (the Yankees and the Mets),
and two hockey teams (the Islanders and the Rangers). When it comes to
basketball, however, if you live in New York, you are most likely a Knicks fan.
The population in New York City is tremendous and with basketball being the
only sport where there is only one New York team, can you picture how many
people are interested in the Knicks’ games? With the additions of Carmelo
Anthony and Amare Stoudemire, its easy to see why a team that already generates
revenues by itself can boost revenues 27% with two star players (Badenhausen).
Teams like the Los Angeles Lakers and Boston Celtics have such a profound
history of championship titles that they will always be in the conversation and
the playoff picture discussion. Teams that host playoff games make money. Teams
with star players sell jerseys, and those jerseys generate revenues. Walk down
the streets of L.A. and you should always be able to see a Kobe Bryant “8” on
somebody’s back within a hundred feet.
Another factor to keep in mind when analyzing a sports franchise’s success is
their ownership. In the video from ESPN (http://espn.go.com/nba/story/_/id/10632191/coast-coast-future-new-york-knicks-los-angeles-lakers),
Israel Gutierrez speaks about the future of four teams, the Knicks, Lakers, San
Antonio Spurs, and Indiana Pacers. The biggest points Israel made were that
with Kobe Bryant leaving the Lakers within three years and the Spurs losing Tim
Duncan and Manu Ginobili within three years, you’re losing almost half of your
offensive production just like that. Israel Gutierrez pointed out that the
Knicks will most likely have a brighter future than the Lakers because Phil
Jackson has a way of turning things around for a team. He brought the Bulls to
success, he brought the Lakers to great heights, and managing what players you
keep as franchise players and when you start looking for prospects is essential
to growing a successful team. How important do you think ownership is in the
NBA, compared to celebrity appeal of individual athletes?
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