Showing posts with label ownership. Show all posts
Showing posts with label ownership. Show all posts

Saturday, August 18, 2007

A community-selfish ownership move: Nothing wrong with that



It's coming.



Just as we thought might be the case, it is really looking like the Sonics will move to Oklahoma City.

With all that joy that Seattle fans had generated after drafting Kevin Durant, they have to be letting out a collective whimper. When a franchise decides to make a true youth movement and start from scratch, it can be one of the most exciting things that can happen for a fan base. Watching your young players grow and mature and gradually win more games as the develop, fans get a certain feeling of involvement with that team that just isn't the same as with teams that acquire most of their talent from free agency or through trades. The reward is so much greater when you get to watch your team blossom from scratch. That's why, subconsciously, this inevitable move is stinging the true Sonics fans out there in a major way.

What is most convincing about the potential of a move is that these Sonics owners are prepared to net a loss in moving the team to Oklahoma City. Aubrey McLendon, who the above article is about, said as much.
"But we didn’t buy the team to keep it in Seattle; we hoped to come here. We know it’s a little more difficult financially here in Oklahoma City, but we think it’s great for the community and if we could break even we’d be thrilled."

It's a strange thought on ownership that I honestly never considered. A rich man loves the area he lives in. The community, the area, everything about it. This is where him and his other rich friends want to spend money, work and live. By happenstance, a tragedy befalls another team's city and they temporarily reside in said rich guys' area. They know that due to the precarious political situation in the town the tragedy befell, they would likely not be afforded the opportunity to purchase that team. So, knowing the temporary team will eventually return to their old city, they seek out another team to purchase.

Clay Bennett saw his opportunity. The Sonics had been having some major problems in getting a new stadium built in Seattle for some time now. Seeing an opportunity to nab a franchise that could potentially move cities, Bennett and his compadres moved in. Their thoughts from the beginning were to move a team to Oklahoma City, that has become rather clear. Of course, they fed some public relations lines to the fans about wanting to stay in Seattle, and they will likely do that same until the move to Oklahoma is approved.

And good for them. Of course, the fans in Seattle are getting screwed pretty good by no control of their own. Unfortunately for them, it isn't their team. It's owned by the guys who purchase it. Sorry, that's how it works.

Now, the ownership group headed by Bennett will be able to move a professional sports team into their backyard, likely helping to pump money into their hometown economy and have a professional pet project to groom. Fortunately enough for them, their pet project is already looking like it has the makings of a thoroughbred.

Reasonably yours,
Scooter

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Tuesday, July 31, 2007

Different approaches to ownership



One of these things is not like the other.



Would you rather have the best players on your team, or the most marketable ones?

It sounds like a stupid question, mostly because it is. Any fan worth their water doesn't give a crap what the general public thinks about the players on their team. As long as they are winning, that's all they care about.

It's an interesting question to ask, however, because many owners probably try and balance this in some way. When it all boils down, there are two worlds that sports owners live.

Revenue-driven owners look out solely for the bottom line.

Competition-driven owners want to win over all other things.

Although not mutually exclusive, the thought process for these two worlds is different. Owners like Mark Cuban and George Steinbrenner, despite their pitfalls, ultimately just want to win. It consumes them. They know that if they win, the money will come. And ultimately, they will spend whatever is within their power to get to that point. Losing kills them inside. They can't sleep, their stomachs hurt. Don't get me wrong, they want to make money, but they would never sacrifice the product they put on the field if it means some lost revenue.

Given, all owners would like their teams to win, but when you break it down to pure motives, most owners fall into one category or the other. Given, I have no problem with the revenue-driven owner. After all, it's usually the real reason anyone who has enough money to buy a professional sports team is rich in the first place. You want a return on your investment. And if that is your main prerogative, that's fine. I just think that owners who aren't passionate about their team's on-field or on-court success don't care about or realize that their earning potential is exponentially higher when the team is successful.

Take the Los Angeles Angels for instance. Their owner, Arte Moreno, realizes that spening money on salary and putting the right players on the field will make his team successfull (obviously). He has also taken steps to cater to the fans by renaming the ballpark to a non-corporate name (branding for the Angels), and lowering beer prices. He takes the fans into consideration and watches his bottom line in the process. It's really a brilliant, not-so-crazy concept that somehow doesn't catch on.

Given, team situations are different. But there are teams that have the opportunity to create an atmosphere of winning that fans love to be around. The Angels built themselves up the right way. Many do not.

My point in all of this rambling is that there are owners like Moreno who consider success primary among the concerns of fans, and sprinkling it with some other incentives helps. Then, there are those who are fine with rolling out a mediocre-to-bad product just because they'll continue to make acceptable profits. Instead of producing a winner, they cover the team with unhealthy toppings instead of building the actual product. New York Knicks owner James Dolan is obviously fine with doing this every season. Because of television contracts and the city they play in, the Knicks will probably always sit atop the revenue hill among NBA teams. What Dolan needs to finally acknowledge, is that rebuilding would ultimately earn him even more money in the long term. Owning a sports franchise is about long-term revenue performance, right? Instead, he keeps pulling in players who he feels the city of New York will embrace...Stephon Marbury and Larry Brown's acquisitions being the biggest offenses among them all. Of course, Brown didn't last. But the Knicks still have Marbury, a New York guy who the fans supposedly like having. But, going back to my initial question...which would fans rather like? A well-built team that can compete, or a team with guys they like personally? I'm imagining they choose the former every time.

Reasonably yours,
Scooter

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Monday, May 28, 2007

Of gambling and NBA

With last season's NBA All-Star festivities taking place in Las Vegas, and a franchise currently looking for a new home (Seattle Supersonics), it would seem as if the plate was being set the eventual relocation of an NBA franchise to Sin City.

NBA commissioner David Stern has since softened his stance and has appointed a committee to explore the viability of a franchise in Vegas, either by expansion or move.

Count me on board that Vegas should have an NBA team. I don't think that an NFL or MLB team would work in Vegas, but the atmosphere of that city would fit an NBA team like a glove.

Stern's biggest gripe, and supposed hardline stance of not allowing a team to go to Vegas unless casinos took gambling off the books is foolish to say the least. This Vegas isn't the Vegas of old, involved with organized crime and other such forms of corruption. The salaries that NBA players helps deter any kind of corruption that may have been possible in days of old. At an average salary of $5.2 million, the price for an NBA player to risk the kinds of repercussions involved with tampering is almost nonexistent. Never mind the fact that if such activities were going to happen, they would anyway as it doesn't require a location in Vegas to collude on throwing a game.

Either way, if an NBA owner wants to move his team to Vegas, there should be no reason that it's acceptable to move to Oklahoma City or Kansas City and not to Las Vegas.

Reasonably yours,
Scooter

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Wednesday, May 23, 2007

Oklahoma City/Kansas City/Las Vegas Sonics face interesting situation

Despite the yearning desires of Celtics fans and ESPN, the franchise with the most NBA championships in league history came up very, very short in today's lottery drawing. With the second best chance to win the lottery (19.9%), Boston ended up with the fifth overall pick, the worst possible pick they could have gotten.

Two franchises in small markets came up large. My favorite is the speculation that almost always comes about concerning a fixed lottery drawing. It's always a bit refreshing when two teams that the NBA would really have no reason whatsoever to endorse end up winning the picks that matter. The Portland Trail Blazers won the first overall pick and the Seattle Supersonics won the second overall pick.

Portland is one of the smallest markets in the NBA, but have a reasonably rabid fan base when the team is competitive. But, for interest's sake, we'll focus on the Sonics. Sonics Chairman Clay Bennett has made his intentions to move the franchise out of Seattle less than subtle. Oklahoma City has shown itself to be a legitimate NBA city by its successful temporary hosting of the Hornets while New Orleans put itself back together. Some other cities, including Kansas City and Las Vegas have jumped into the fray also. Since Seattle and Washington state have basically told the Sonics that a new arena in Seattle isn't going to happen without substantial funding from the franchise, Bennett has sought to move the team elsewhere so that the team will be in a newer facility and have the potential to gain more revenue from a city that is hungry for a basketball team.

The Sonics without a GM and head coach, it seems that a completely fresh start is coming. With either Kevin Durant or Greg Oden soon to become a Sonic, the franchise really does find itself in a unique situation. They'll be in Seattle for at least the next season, so starting clean completely this coming season just won't happen. One of the most interesting subplots this coming season will be how the city of Seattle reacts to an exciting young player in a city that is preparing to have their long-time NBA team moved elsewhere. How Oden or Durant (whichever falls to them) reacts to the situation will be equally interesting. Now, if somehow a move to Vegas happens, expect me to have an aneurysm of interest in that situation. A potential post on the NBA's potential in Vegas is coming soon.

Reasonably yours,
Scooter

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Sunday, May 20, 2007

Russian women's basketball toy

I came across a fascinating article about the WNBA yesterday. Admittedly, this is the first time that has ever happened, and my interest was piqued early on by a Russian women's basketball team owner named Shabtai von Kalmanovic, pictured right. He is referred to as the "Mark Cuban of Russian Basketball"... only if Cuban had ties to African diamond trafficking and spying for the former Soviet Union.

Either way, this guy is quite a character. Incredibly wealthy from a construction business in Africa, von Kalmanovic owns Spartak, a women's team in Russia and employs the likes of well-known American women's players Diana Taurasi and Sue Bird (no relation to Larry), both WNBA players. The crazy thing is, Bird makes makes four times as much in Russia as she does in the WNBA, and Taurasi makes 10 times as much in Russia as she does in the WNBA. Even with basketball easily playing a third hand in the U.S. to football and baseball, and even with women's basketball usually getting second-class citizen status among basketball fans, surely the U.S. could afford to pay more to players than a team that plays winters in Russia and all over Europe and parts of Asia, right?

Here's the catch: von Kalmanovic doesn't seem concerned with making money off the team. With loads of cash to throw around, von Kalmanovic estimates that his expenses for the season will be $5-6 million. They don't charge money for tickets to games (of which they average a measly 3,000 in attendance per game), they pay to have their games televised, and pay for travel among other expenses. He basically makes no money from owning the team. He compares it likes this:
"I have friends who go to casinos," von Kalmanovic said. "I know friends who risk on the stock exchange. I am Lithuanian — for me, basketball is everything. It is a hobby, a pleasure, a casino, whatever you want."

Completely contrary to virtually every other model of team ownership, von Kalmanovic basically holds his team as a toy. With the WNBA having a relatively short season and an incredibly restrictive salary cap based upon years of service, the opportunity for the top women's players is too great to pass up. In what adds up to no salary cap, owners such as von Kalmanovic can basically pay to have the best players in the world come play for them during the winter, often putting them up in a nice place to live and providing attractive amenities.

At the end of the article, von Kalmanovic talks about him and his fellow owners sitting down and agreeing on maximum salaries for players because "it becomes too much." We'll see how he likes it when another owner steals a player he covets because she likes the area the team plays in better than his own and he isn't able to pay more to draw her to Moscow because of the maximum salary limit.

The point to all this is that it really is quite amazing that an independently wealthy basketball fan basically just throws all the BS to the wind and strives to put together a toy that performs very, very well. Can you imagine a rich American basketball fan who didn't want to deal with the mess of purchasing an NBA team and instead opted to pay significant salaries to players who marginally miss NBA rosters and dominate through a league like the CBA or ABA? With little concern for profits, someone like that could make a lot of waves and could essentially build up their toy to win through a league full of spares as they wish. Mark Cuban, are you listening?

Reasonably yours,
Scooter

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