It was pretty apparent that the NBA was in financial despair last season, the League stated that 22 of its 30 teams lost money to a total of $370 million.
However, BizofBusiness shows that 17 teams have lost money according to Forbes.
In fact four teams were very profitable, the New York Knicks ($64 million), Chicago Bulls ($51.3 millon), Houston Rockets ($35.9 million) and the Los Angeles Lakers ($33.4). The least profitable was the Orlando Magics (-$23 million), the Nuggets also suffered $11.7 million in losses last season. Even the Dallas Mavericks, who won the NBA title, lost nearly $7.8 million.
The NBA was a failing system not only with the disparity in revenues, but also being stuck in financial burden with overpaid players. Four of the highest paid players in the League played fewer than 65 games and averaged less than 12 points a game.
- Rashard Lewis was the highest paid Washington Wizard and according to Hoopshype was due to earn more than $20.5 million last year (which was the second most in the League last season), despite only playing 57 games and averaging only 11.7 points a game.
- Michael Redd was paid $18.3 million which was fifth in the NBA, despite only playing 10 games and averaging 4.4 points - which put him 13th best scorer on the Milwaukee Bucks, who are a below average offensive team.
- Andrei Kirilenko made $17.822 million last season (seventh most in the NBA), but only played 64 games and scored 11.7.
- Despite only playing six games last season, Yao Ming racked in $17.686 million. Of course, his popularity may have been one of the reasons why the Houston Rockets were making money last season.
- Kenyon Martin topped the Nuggets in money with $15.959 million, but in only 48 games he scored 8.6 points and grabbed 6.2 rebounds.
There are murmurs that the NBA will install a hard cap at around $62 million, which would allow teams to cut ties with players that are clogging up the salary cap. Which continues to be a big disagreement between the players and the owners. Larry Coon put in perspective.
The owners want to turn a profit and increase the value of their investments, just like any business owner. The players want to protect their earning power as well as their job security, just like any employee. The sides disagree on the nature and scale of the problem, and what it would take to fix it. And both sides want their narrative to be seen as the right one.
The Return of the Allan Houston rule?
One thing that is being discussed during the lockout is the amnesty rule, which is often known as the Allan Houston rule. This rule allows a team to waive a player without paying any further luxury tax on the player’s contract, regardless of how long or how rich the contract is. The player will still get paid, but it won’t cost the team any more money.
If this rule is in the place, the most likely casualty on the Nuggets would be Al Harrington, who is due to make nearly $28 million over the next fours years (last two seasons are only partially guaranteed). Another option is Chris Andersen, who turns 33 on Thursday. The ‘Birdman’ is due to nearly $13.5 million in three years.
This would also make the free agency market much more interesting as players like Marvin Williams, Corey Maggette, Richard Hamilton, Brendan Haywood, Drew Gooden, Brandon Roy, Travis Outlaw, Gilbert Arenas, Elton Brand, Josh Childress, Richard Jefferson and even Carlos Boozer could be available.
Nuggets in a good position
The new CBA may hurt a few teams, but not the Nuggets. They are currently sitting pretty with one of the smaller salary caps at $32.3 million (which includes qualifying offers) according to Mike Prada at sbnation.com.
Depending on where the salary cap is next year, the Nuggets will have anywhere between $10-20 million to spend on free agents.
One less suitor for Nene
The New Jersey Nets are a team that could potentially be interested in the services of Nene. They have the money to offer, and also young talent to play with him (Deron Williams, MarShon Brooks and Brook Lopez). However, reports are the Nets are really interested in being a player in the Dwight Howard sweepstakes – which means they would more than likely pass on Nene.
Another team, Golden State Warriors have highlighted Nene as their top priority when the NBA Lockout is done. The problem is that they can’t offer him the same amount of money the Nuggets can and they also have Nene’s arch-nemesis on their team – Louis Amundson. Amundson may not keep Nene from taking more money and playing in Golden State, but you can bet that Nene was one of the reasons why the Nuggets decided not to sign Amundson – despite his roots to Denver and wanting to play here.
Tags: Al Harrington Andrei Kirilenko Birdman Brandon Roy Brendan Haywood Chicago Bulls Chris Andersen Corey Maggette Dallas Mavericks Denver Nuggets Deron Williams Drew Gooden Dwight Howard Elton Brand Gilbert Arenas Houston Rockets Josh Childress Kenyon Martin Los Angeles Lakers Louis Amundson Marshon Brooks Marvin Williams Michael Redd Nene New Jersey Nets New York Knicks Orlando Magic Rashard Lewis Richard Hamilton Richard Jefferson Travis Outlaw Yao Ming