NBA lockout continues

David Stern gave the players an ultimatum last week - take the owner's current offer by 5 PM on Wednesday or the offer will be pulled off the table, resulting in a far less generous proposal.  Things could get ugly in that case, more so than they already have.  If you'll kindly glance at your calendar, you'll notice that this deadline has come and gone, yet the sides are still negotiating.  So that must be a good sign, right?

The two sides negotiated well past the 5 PM deadline last night and plan to pick up the talks again today.  This may make Stern's ultimatum seem like an empty threat, or could just be a sign that as long as enough progress is being made to allow negotiations to continue then there is no need to stop that momentum by pulling the offer off the table.  If the current round of negotiations fails to result in a deal agreed on by both sides, the threat of Stern's ultimatum is still at risk of becoming a reality.  In that scenario, Stern has threatened that the owners next offer would go no higher than 47% of BRI (basketball related income) for the players and include a hard cap.

The players suffer from a lack of leverage in these negotiations in that the owners are much more capable of surviving a lengthy lockout.  As players continue to miss pay checks, their urgency will increase.  On the other hand, many owners had been losing money under the last agreement, so some of them may actually be content to miss the entire season.  If the owner's were to carry out their threat of lowering their offer, it could result in the players resorting to the little amount of leverage they have left, which is the threat to decertify the union.  That could potentially move these negotiations into the courtroom, which would be a drawn out process that would almost certainly mean the cancellation of the entire season.

I've been saying for months now that a 50/50 split of BRI is where we'd eventually end up at.  Recent progress may finally have gotten us to that point.  The latest offer from the owners calls for the players to receive between 49 and 51 percent of BRI, depending on league performance, so 50% appears attainable.  The sticking point for the NBPA is that in order to agree to 50% (down from 57% the players received in the previous deal) there needs to be a compromise that allows them certain concessions from the owners.  The owners are in favor of harsher penalties for teams that spend into luxury tax territory, a reduction in the mid-level exception, salary roll backs on existing contracts and the elimination of the sign-and-trade deals.  These are just a few of the system issues the sides are still haggling over.  In order for the players to agree to 50% of BRI, the owners will need to back off on at least a few of those demands.

From the players perspective, they understand that the new deal won't be as generous to them as the previous one. The challenge for union director Billy King and union president Derek Fisher isn't to get as much as they can from this new deal, it's to prevent the players from losing too much.  As long as measures are taken to fix the system, the players are generally in favor of allowing their percentage of BRI to be reduced if it's in the best interest of the league.  Many of the small market owners are the ones leading the charge to reduce the players percentage even more, as they are the ones at risk of losing more money.  Keep in mind though that the owners already take a large chunk of money off the top of the league's income to cover operating costs before the remaining BRI is split.  These costs include payments on the team's home arena. In cases where the owners also own the arena, they are essentially taking that money to pay themselves.  So a 50/50 split of BRI still wouldn't really be even. 

In order to settle the concerns of the small market teams that are legitimately losing money, the real issue here is to improve the system for revenue sharing.  That's not the player's issue, but once the owners work out the issues with that system it will make it much easier for owners to concede to some of the player's issues.

Here is my proposition for how a new deal should go:

• 50/50 split of BRI
• Reduction to the mid-level exception to $3 million (down from approximately $5.7 million last year)
• Bird rights limited to one player per season.  Similar to the NFL's franchise tag, this would allow teams to re-sign their own star player at a price substantially higher than what any other team can offer, regardless of the team's salary cap situation.  The player would still be free to leave for another team, as long as they are willing to settle for less money.
• Elimination of sign-and-trade deals (to prevent another Carmelo situation). 
• No roll backs on current salaries, but an amnesty clause that would allow teams to shed one current contract off their luxury tax and salary cap numbers (the player would be released, but still paid).

This seems like the fairest compromise for both sides, as it meets both sides in the middle on several of their main issues.  This plan would enable teams to spend more on star players while helping to protect them from overspending on mediocre players, which the owners have proven they are incapable of resisting (5 years, $35 million for Travis Outlaw, really?).  The Union doesn't like that, because their stance is to protect the middle-class player, which makes up the majority of the league, but in all fairness, the super stars are the ones fans pay to see.  They should be making more money, while the amount of overpaid mediocre players has gotten out of control.

The sides are getting closer, but the clock is ticking and the time to save the season is running out.  Given the collection of young talent the league has to offer, the NBA has arguably never been more popular.  Coming off their most successful season in over two decades, it would be a tragedy for the season to be lost.  There's too much on the line for either side to allow this to drag out much longer.  It's a shame that it's gone on as long as it has.  Yet there is still hope that a deal can be reached soon.  It just requires each side to suck it up and give in a little.  It's called compromise, and it needs to come from both sides.  Otherwise it could be a while before we get to have basketball back in our lives again.