The NBA canceled the first two weeks of the 2011-12 regular season on Monday because of an ongoing labor dispute with its players union over a new collective bargaining agreement. Here is the situation as it stands right now:
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The NBA has only once before lost regular-season games as a result of a labor dispute, when the 1998-99 season was shortened to 50 games because of a lockout. Stern and Hunter both presided over that battle, as well. The sides were able to negotiate amicably a new CBA in July 2005.
The players have been locked out by the owners, they are not on strike. A lockout means players cannot play and are not paid while the collective bargaining process continues without an agreement. In fact, the players signed a "No Strike" promise to the league before the lockout began and asked the league to return the favor with a "No Lockout" promise, which it refused to offer.
The main event
The owners wanted to install a "hard" salary-cap system, with two versions modeled after the NFL and NHL formats. Both were rejected by the union, so the NBA proposed a "soft" cap system that had heavier restrictions on spending over the cap threshold than in the previous CBA. The union rejected this as well, saying the restrictions act like a hard cap. The players believe the soft cap from the previous CBA, with a few minor adjustments, is fine and that owners should exercise more self-control with spending. A "hard" cap restricts a payroll to a certain limit for every team, while a "soft" cap allows a team to spend over the threshold, but every dollar over is taxed by a specific amount. In the previous deal, a team was taxed $1 for every $1 over the cap. The owners want to double and, in some cases, quadruple the tax to make it more of a deterrent.
The money game
The sides are haggling over the split of the league's revenue, known as Basketball Related Income (BRI), which is about $4 billion. In the previous CBA, the players received 57 percent of the BRI for salary, while the owners got the remaining 43 percent. The owners have proposed a dramatic reversal so that they get 53 percent of the BRI, with 47 percent to the players. The players offered to decrease their share to 53 percent, but refuse to go any lower. The sides discussed the concept of a 50-50 split, which is what the NFL has with its players, but before it could gain momentum the NBA players rejected the 50-50 idea.
What's at stake
With the first two weeks already gone, Stern warned that the longer the dispute continues, the more games will be canceled. If the dispute reaches the end of the calendar year, the prospect of losing the entire season grows stronger.