Tuesday, September 28, 2010
David Stern's doom and gloom takes a $100 million hit
By Henry Abbott
In the Sports Business Journal, John Lombardo writes that the NBA season tickets are selling like hotcakes.
Fueled by an offseason of high-profile player moves, the NBA will begin the 2010-11 season next month with more than $100 million in new full-season-ticket revenue, a record amount for the league, and also having sold more new full-season tickets than all of last year.
Through Sept. 22, NBA teams had sold more than 50,000 new full-season tickets, a 40 percent increase from the same date last year. With the yield to the league from season-ticket sales for this year being about the same as what the league posted last year, that means revenue to the league because of the new sales is up roughly 40 percent as well.
Overall, the NBA expects $1 billion in gate revenue, with approximately 75 percent of the gate coming from the sale of season tickets. The league’s season-ticket renewal rate is more than 80 percent, up from 75 percent last year.
Prior to this season, the 2007-08 season stood as the league’s best for new full-season sales, with 48,000 tickets sold. Last year, eight teams had full-season-ticket sales of at least 10,000. To date this year, 10 teams already have sold more than 10,000 full-season plans.
The Bulls, Heat, Knicks, Thunder and Magic are said to be some of the biggest success stories, although the Kings, Grizzlies and Bobcats are also noted.
Stern, of course, needs to position owners as bleeding cash. That way he can force major salary concessions from players in the next collective bargaining agreement. But that job is getting tougher.
For instance, in this article Stern is quoted pointing out that to achieve these sales teams had to spend more, for instance on salespeople.
Do you have any idea how many salespeople you can employ for $100 million?
I think I'm more open-minded than most to the idea that owners may have taken a financial beating over the last few years. A tougher thing to assess, however, is whether that economic rough patch is durable. News like this certainly suggests things are normalizing to a level where owners need not be in such dire straits -- even if the players are getting paid a lot.