NBA to announce new TV deal on Monday
- Thread starter My2Cents
- Start date
GVC
Well-Known Member
In case anyone's wondering how Locke got to that $88mm cap figure (which seems fairly accurate), here's the relevant info from Larry Coon's FAQ:
Assuming benefits don't increase, the new deal should by itself raise the cap by the increase in broadcast revenue ($2.66B - $930mm) multiplied by 44.74% = $25.8mm. This year's cap is set at just a bit over $63mm, so the extra broadcast revenue should by itself increase the cap to about $89mm. Effectively, if other revenues continue to increase as they did last year, the cap could be above $100mm by the 2016/17 season, representing more than a 50% total increase over the 2014/15 cap. Any news on when this deal will be included in Basketball Related Income?
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Assuming benefits don't increase, the new deal should by itself raise the cap by the increase in broadcast revenue ($2.66B - $930mm) multiplied by 44.74% = $25.8mm. This year's cap is set at just a bit over $63mm, so the extra broadcast revenue should by itself increase the cap to about $89mm. Effectively, if other revenues continue to increase as they did last year, the cap could be above $100mm by the 2016/17 season, representing more than a 50% total increase over the 2014/15 cap. Any news on when this deal will be included in Basketball Related Income?
fishonjazz
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It makes me feel alot better about it
seattlejazzfan
Well-Known Member
Same.
nateboz
Well-Known Member
The higher TV deal means higher contracts. Higher contacts will not be fully covered by the TV deal. Simple economics.
Your $40 tickets will creep up to 45 a few years later 50 and so on.
Many thousands of people are now getting rid of satellite and cable packages and going with roku. Netflix. Amazon fire tv. Apple TV and so on. This tv deal is not a good thing for anyone but the players and owners.
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Joe Bagadonuts
Well-Known Member
^The ticket prices will go up in the future independent of TV revenue, not because of it. The two are mostly unrelated except that the increases are due to inflationary and popularity issues related to the same product.
^ Simple Economics
I'll be curious if this ups League Pass costs. I don't do cable... Netflix, Amazon and LP via Xbox is perfect for our fam.
Don't really mind the costs going up though. As the fan base expands the league should profit. It's entertainment, so a completely optional expense for me. If I don't want to pay I don't have too.
What this actually means is that advertisers will pay more for the same amount of space. They are willing to do that because there are more eyes watching the game.
The amount cable networks pay for a package is determined by viewer results across the entire spectrum of programming, and they generally have a sense of what the increased costs are going to be. Then that gets distributed across all viewers. Depending on your point of view thus is why cable is broken, or great.
If your a fan, then your cost of entertainment is subsidized by all of the nonfans, keeping your cost of entertainment lower.
Stifle Tower
Punch Bowl Re-Filler
Doesn't really matter.
In three years, Hayward is opting out and will demand a 5/30% contract. Do the Jazz want to pay him $25-30M in 2017 (according to GVC's estimate of the cap being at $100M)? I hope Gordon has a great couple of seasons. I hope Hood develops rapidly. I look for Hayward to be on the trading block in a couple of years.
GVC
Well-Known Member
"Demand"? The market will set his price; I'd be surprised if any team offers Gordo 30% of the cap.
GVC
Well-Known Member
This doesn't really make any sense. 44.74% of the increase in TV revenue will go to the players, fully covering the increase in player contracts (this is how the CBA works). The owners pocket the rest, while providing the exact same product. If other pro sports leagues are getting a similar bump in TV revenues (like the NHL received recently), it seems more reasonable to expect that ticket prices, or the rate at which ticket prices increase, will fall.