As any successful CEO would, NBA commissioner David Stern on Thursday rattled off all the reasons to believe his $4-billion business has performed well in the past season: record TV ratings, improved attendance, palpable excitement at playoff time.
Having said that, Stern added the necessary disclaimer to explain why the NBA might be headed for a lockout when its collective-bargaining agreement expires July 1.
"Despite how good things are,'' Stern told a group from the Associated Press Sports Editors organization, "we still are likely to finish having lost collectively in the neighborhood of $300 million, which is better than the $370 million we lost two years ago and the $340 million we lost last year. We're happy with that, but we remain intent on having a system that allows us to have a sustainable business model.''
The bottom line, Stern and deputy commissioner Adam Silver said, is that the league is projecting a profit-loss record of 8-22 by the league's 30 franchises. "We're running out of time,'' Silver said. "We need to intensify negotiations.''
Just what sports fans wanted to hear -- the prospect of dueling lockouts by the NBA and NFL, which already is in lockout mode. Comparing his apples to the NFL's oranges, Stern said, "They're profitable; we aren't. We have a union; they don't.''
Stern said the NFL is on a risky path now that its union has decertified and the matter has gone to court with an antitrust suit. "It's a mess,'' Stern said. "Hopefully, they'll work it out.''
As for the NBA's potential mess, the league wants to reduce the 57 percent share of gross revenues that goes to the players. Stern has proposed a "net'' system in which owner expenses come off the top and net revenues are split 50-50 with the players. "Our goal is a hard-salary-cap system,'' Silver said.
Silver agreed that reports that salaries would be cut by one-third are "generally accurate in a macro sense.''
Unlike the NFL, the NBA has provided the union audited financial statements for every team. The union has accepted the numbers while arguing what should be included as loss and factoring owners' equity into the profit side of the picture.
You almost could hear the drums of labor war beating when Silver compared the situation to the NHL's loss of the entire 2004-05 season to achieve a 25 percent salary rollback. But Stern wasn't quite prepared to threaten a season-long shutdown.
"We would never be at that point,'' Stern said. "We don't expect to get there, but a lockout is not a punishment. It's an economic weapon [to] make a deal. That's our goal. The NHL is a worst case. Players would lose their salary, lose everything, and if you're a team, you've taken a monster hit that would take years to climb out from. We don't throw that around lightly. We preach to our owners this is something to avoid at all costs.''
No negotiations are scheduled, but Silver said the league is preparing a revised proposal for delivery to the union shortly.