It’s the perfect time to offer an olive branch.
It’s time to be a leader.
Why make a deal now? Both sides are taking a big hit. It’s a stalemate and NO one (besides the lawyers) is winning: owners, players, agents, workers, fans, restaurants, charities, etc.
The losses are building. The economy is fragile. Casual fans are moving on. Expectations for a season are low. It’s the perfect time for an “upside surprise” – to borrow a term from my industry.
Large amounts of money and plenty of egos at the table is never a good mix. It got out of control. Pride took over from common sense. Mr. Stern, you didn’t give them an out. You backed them into a corner – pro athletes who have fighting-through-adversity in their DNA. That’s what makes them special. That’s why they are in the NBA. They’ve never backed down from a good competition.
It’s time to lead. Give them an out. Give them more than half. Use 51% as the midpoint of a band. Take the high road. Make Billy and Derek look good (or perhaps less bad). Be the better man. Lead.
Yes, the owners will not be universally on board. However, they scored many wins on the “system”. Flexibility has increased. The accelerated tax system is a good step. Coming down from 57% to 51% will surely solve many ills. NBPA Economist Kevin Murphy argued “Our moving from 57 to 52.5 covers more than 100 percent of any cost increase they’ve had.” 51% is even better. The owners likely see a deterioration in the economy and wish to protect their investment, but they are also facing a time value of money problem. At this point on the calendar, the league can still have a decent schedule full of dramatic playoff races and sold out playoff series. Plenty of cash will still come in the door.
Could you forgo that cash flow to grind the players down to 47%? Absolutely. But how does a cancelled year and constantly grinding down your players impact two your key stakeholders (fans and employees/players)? Do you negatively impact BRI such that many relatively fixed expenses cannot be covered anymore – even on a more favourable split? The players are what ultimately brings the fans in who pay $10 for a beer and $100 for a jersey. Give them an olive branch and get them on side so you both win. The fans? A surprise deal will win most back. The media spotlight alone is worth millions in free advertising.
Will the players take it? Probably. Surveys suggest the player/owner blame is 50/50. It’s too hard for one side to win the public over. More importantly, the players surely knew the “ultimatum deal” was the best they were going to get. Make Billy Hunter and Derek Fisher look good. Say it was a mutual truce. Everyone came together. Maybe add another small concession. They felt they had to stand up to the previous offer. But that was emotion talking. Rationality is starting to win. But you have to give them an out. The players want to play and are now missing paychecks. The European debt crisis and limited spots makes signing overseas a tough option. With the NBPA withholding player’s licensing profits to pay for lockout legal fees, the pressure for a deal intensifies. Former NBPA executive director Charles Grantham said it best “My philosophy was to keep the guys working, because they lose income that’s not recoverable.”
The downside? Sure, some in the media (and players) would criticize you for not offering a slightly better deal earlier. As mentioned, some owners will not be pleased. However, the upside to a deal now is much bigger. With certainty and a better deal, upset owners can sell their franchises if they are not satisfied.
It takes approximately 30 days to start game one. Just in time for Christmas Day games.
Will David Stern do this? No. Through these negotiations he has not exhibited the inspired leadership and courage that would be required to pull this off. Now that they are in court, it takes even more courage as lawyers in both sides would strongly discourage any gesture which may appear to be conceding.
You can keep going down the current road and break them.
Or you could lead. And win.
It’s your legacy Mr. Stern. Your move.
Update: As of 3am this morning (Saturday, November 26), after 15 hours of negotiating, the NBA and the players have reached a tentative deal to end the lockout. And I believe the players are happy about it.
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