NBA lockout begins after negotiations between players, owners fail


A meeting between NBA Commissioner David Stern, left, and the leagues owners and players fails to make enough progress toward a new CBA to prevent a lockout. (Mary Altaffer/AP)
June 30, 2011

National Basketball Association players and owners braced for a lengthy shutdown that could threaten the 2011-12 season after last-ditch talks over how to split up the league’s $4.3 billion in annual revenue collapsed Thursday without any significant progress.

After the unsuccessful three-hour bargaining session in Manhattan, NBA officials said during a somber news conference that they would lock players out of team facilities Friday, becoming the second U.S. professional sports league to shut down operations since March.

But as the National Football League moved closer to salvaging its season and ending its 15-week lockout during talks in Minneapolis, NBA players and owners faced the likelihood of lost games or a lost season because of massively differing views on the economic health of the game.

“It worries me that we’re not closer,” NBA Commissioner David Stern said during the televised news conference. “We spent all this time trying to get closer. We have a huge philosophical divide.”

The players offered a final proposal Thursday, but Stern said the plan would have gradually increased the players’ average salary from $5 million to more than $7 million while preventing teams from achieving profitability.

NBA’s owners claim the league suffered $300 million in losses last year as 22 of its 30 teams — including the Washington Wizards — operated in the red, and that a revamped economic system is needed to bring costs under control.

Players blame free-spending owners who have made poor business decisions for the deficit. They contend the current system has helped generate unprecedented television ratings, interest and profits and should not be greatly changed.

“Our guys are anxious to get a deal . . . but to make sure it’s a fair deal for them,” NBA Players Association chief Billy Hunter told reporters after the meeting. “I think we’ve been trying to arrive at a win-win for both sides, and that’s part of the difficulty.”

The NFL’s dispute, in contrast, has been largely over sharing the cash-rich league’s magnificent wealth: how to equitably split some $9 billion in annual revenue. A host of NFL owners, players and NFL Commissioner Roger Goodell assembled in Minneapolis this week, including late into Thursday night, for talks that hinted a deal could come soon.

In New York, meantime, Stern, Hunter, deputy commissioner Adam Silver, and player representatives Derek Fisher of the Los Angeles Lakers and Maurice Evans of the Wizards met for just more than 21 / 2 hours before abandoning talks.

“I was never too worried about the NFL,” said Gary Roberts, a sports law expert at the Indiana University School of Law in Indianapolis. “The only issue there is how to divide up this huge pot of money. . . . At the end of the day, this is going to get done and there will be a full season of football games.

“The NBA is in a totally different place. The business model is just broken. Too many teams are losing too much money not to have fundamental structural change.”

No further sessions have been scheduled, but Hunter said he expected the sides would reconvene in a couple of weeks. The league’s collective bargaining agreement expired at midnight Friday.

The last NBA lockout in 1998-99 lasted until January and shortened the season to 50 games.

Owners maintain the league requires a major fix, a new economic system that will allow gradually increasing revenue streams to keep pace with far more dramatically rising costs. They contend that the current 57 percent of annual revenue — after $600 million is subtracted to cover expenses — that is paid out to players is too much. They are seeking an additional $900 million off the top, and a 50-50 split.

The players have offered to give back $100 million a year for the next five years, but they have refused a huge pay cut.

Ownership also wants a hard cap on team payrolls to replace the current soft cap that teams can exceed by using a variety of exceptions. Owners contend that will help not only to keep costs under control but also to improve the league’s competitive balance.

Players say a hard cap will eliminate the league’s middle class and drastically reduce the number of guaranteed contracts.

“If you look at the proposals from the league, they’ve shown no motivation to make a deal, other than hitting the biggest home run of all time,” said Mark Bartelstein, a prominent agent and head of Priority Sports. “That doesn’t give you a lot of [hope] that they are going in the right direction.”

Yet unlike at the start of football’s lockout, when Minnesota Vikings player Adrian Peterson compared the NFL to “modern-day slavery,” the NBA talks have been marked by civility as the league’s owners and players have striven to avoid inflaming their growing fan base.

As a host of star players aligned with different teams last summer, the NBA saw significant growth in television ratings, tickets sales and other indicators of interest, and both sides have been wary of bringing that progress to a halt. Stern, however, dismissed the parties’ attempts at goodwill.

“I think our fans will tend to have a negative view of ‘Why can’t you guys work things out?’ ” he said Thursday. “I don’t expect anything good to come out of this. . . . The lack of animosity doesn’t get us any closer with respect to the underlying philosophical divide.”

Staff writer Michael Lee contributed to this report.

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