Earning Your Earnings: Why Some NBA Teams Should Lose Money

In the history of the NBA, has it ever been customary to expect every franchise to hoist a profit in any given year? With discussions of team profits dominating headlines this off-season, I am struck by the feeling that the ever-present threat of low earnings is integral not only to the business of basketball, but to the sport’s more significant value as high drama.

Perhaps owners’ anxiety over losing money should be a crucial factor in the organic life of the league. Is it not the divine struggle of an NBA team to keep itself afloat financially, in the changing climate of each season, postseason and off-season? Should owners be deliberately casting the right characters to earn for their teams, eventually, a longstanding image, market, and identity? Or should owners be spending their money on lawyers to lobby for the correct set of circumstances to allow them to make a profit on their mediocre teams?

In regards to the biggest NBA market teams, to the Celtics and Lakers, the illusion of grace lingers in the eyes of basketball fans around the world. These teams have made it happen, we think, and they will try to make it happen again next year. The improbability of one team’s unique success transforms an NBA team into an iconic cast in a world of heroes. To create and to maintain a successful franchise is a demanding endeavor. Few markets are truly dependable, sustaining their teams with rewarding profits built on high demand. This kind of demand is earned. It is not easy. Many teams fail. Many teams have never realized championship glory. Fame is not apportioned to all equally. It must be earned. And that fact is one that testifies to the challenge of the task. This is no walk in the park. This is it. It is this fact upon which the high scale drama of NBA basketball is founded.

Consider the Grizzlies. Memphis earned themselves a spot in our collective conscious during the playoffs. I do not doubt that they will sell more tickets and more jerseys come next season. The draft picks, player development, coaching — it all added up into something more. An event such as this intrigues and surprises fans. The Oklahoma City Thunder have steadily been gathering momentum in sales and future prospects, to the point that they are well-acknowledged as a buzz team. They are another instance of management showing a certain urgency, a willingness to compete. These two teams seem to have built something. They have realized a success. They are, perhaps, over the hump — for the near future, at least. The Oklahoma City Thunder are now a potential investment in the eyes of basketball fans. I very well may buy a James Harden jersey. I like watching the Thunder compete. And that is the way the NBA appears to us. Who is doing well? Who has been fostering something special? Who is building a beautiful sort of organism, a real team. This is what captures the imagination. Teams are not bastions of corporate profits. They should not make money by virtue of being in the league. They have to earn it. They have to earn our attention.

It seems to me that losing money in basketball is one more incentive to be great. A team can get burned out there, and it can get burned quickly. One must always reach for the gold. At the very least, it has to popularize a star. They have to make us want it. They have to try to make it big. They can not just subsist. Fans don’t want NBA teams to subsist. Take the Knicks. The media created a situation in which the New York Knicks either could make a move to prove to the world that they were bent on winning, or they could choose not to. The Knicks made the decision they were supposed to — for next year. For the hubbub to be aroused by Carmelo’s jersey.

The Lakers will always be profiting by the names of Magic Johnson and Shaquille O’Neal, just as the images of Magic Johnson and Shaquille O’Neal will always be selling the image of the Lakers. The Lakers profit from their history.

If a team is not doing well and an owner gives up on the project, then the team should be left to expire. Just like any other corporation. Teams should be natural, and yes, maybe there might be less of them at times. We need worry less about the future and worry more about the present. The lockout propagates the fear of failure, which, in the end, is unacceptable to everyone. The clearest issue is surely profit.

Although the Chicago Bulls have struggled at times, Jordan, Pippen, and Jackson built a longstanding market that could not easily subside. And this feat of domination, of unquestionable supremacy, is remembered by the fans who were amazed, and the fans who believed. It wasn’t just that it was Jordan. It was the brand: in Chicago, with that red bull painted on the floor, and those beautiful letters upon his chest: B-U-L-L-S. Timeless images were created that do not go away. The Bulls remain a profitable powerhouse, and their history, embodied in their brand, is their qualification.

In Memphis, in OKC, we have seen the beginnings of history. We have seen what it will take for a team to earn itself recognition and, in due time, a year of substantial profits. Frankly, I don’t care if the Kings make money, or the Suns, or the Bobcats. What did those teams care about last season? What did those teams do to ensure their success? Did they think I wanted to see their halftime shows? Or, did they think I wanted to see them compete? And why should they be entitled to a bailout?

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Pete Maravich on the NBA lockout

The all-time NCAA scoring champ (44.2 ppg!) and five-time All-Star starting guard recently took some time out from dunking on Jesus to weigh in on the League’s present contractual difficulties:

“It’s going to continually get worse because America is built on one basic principle: greed.”*

This kindly old man man also averaged 27-5-and-5 (81% from the line)

This kindly old man once dropped 68 points on Clyde Frazier's Knicks.

“Pistol Pete,” always colorful, went on to offer up some more specific insights into pro basketball’s labor policies.

Asked about parity and revenue-sharing, Pete replied, “They don’t particularly care about balance. Just the TV markets. Everyone says we got [All-Star forward and free agent] Sidney Wicks but I don’t see him here … the reason all those teams like Chicago, New York, and Boston get the good players is because they are in the major TV markets.”** Wicks was ultimately sent to the Celtics after league arbitration despite signing with Maravich’s fledgling New Orleans Jazz.

In light of some spirited discussion regarding the integrity and openness of the NBA’s owners and front offices, Maravich, who once averaged 27-7-and-4, had this to say: “I dealt honestly with these people. I can’t tolerate any more deceit and deception on the part of the coach and the present administration. [GM] Pat Williams and [Coach] Cotton Fitzsimmons have lied to me.”*** Harsh words to be sure, issued after secret negotiations led to a trade from the playoff contending Atlanta Hawks to the brand-new New Orleans expansion team despite assurances to the contrary. After that, Pete says he “realized what a cold, flesh-peddling business basketball could be.” Ouch!

Everyone has a bad day at the office, but did the first-ballot Hall of Famer have any more general opinions on the NBA writ large?

“It’s difficult to be happy in this business… I’m completely frustrated with basketball. I’m sorry I ever came into this league.”****

Lockout with your socks out, Pistol Pete!

* 1976 interview with George White of the Houston Chronicle
**
Excerpt from Maravich’s autobiography, Heir to a Dream (1987)
*** 1974 interview with Darrel Simmons in the Atlanta Journal-Constitution
**** Ibid.

(Note: this may or may not be a teaser to an upcoming article which may or may not be a book review of a recent biography on the life and times of Pete Maravich.)

Search terms that have lead people to Hoops, I Did It Again

Abridged, but fairly representative. 

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Sports and Our Media-Driven Culture

(This is my first post for HIDIA, and I’m very excited to be a part of this collaboration.  Hopefully I can help expand our horizons to beyond just basketball in the future as we take this project further.)

I awoke the other morning – hungover in the afternoon as expected after working the night of the 4th of July – and groggily flipped on my laptop as I downed a glass of water. I’m on Facebook for no more than ten minutes when suddenly my news feed starts blowing up.

I can’t believe they let her off!

What a fucked up system, it was obvious she was guilty!

The jury may have said she was not guilty, but God will not be fooled when it comes time to judge!

“Oh yeah,” I mumble to myself. “Wasn’t some woman on trial?” My indifference to hyped up media stories is a well-known trait amongst my friends. I abhor the paparazzi and what they have done to American entertainment. I detest the way we uphold celebrities, putting them on some golden pedestal, wherein every move they make can be scrutinized, analyzed, judged, and then re-analyzed. Only in America can you get a reality show because your mom was once a Vice-Presidential candidate and you got knocked up in a tent by your teenage boyfriend, or because your father was once the attorney of a former football superstar (hey, foreshadowing).

But there was something about these Facebook comments that exploded onto my grimy laptop screen. Such intensity, such disgust, such seemingly omniscient judgment. For a woman they don’t even know! Some no-name piece of white trash (as my friend so eloquently put it) who happens to be hot, and to have potentially killed her baby daughter (hey, I’m not passing judgment, I already told you I didn’t watch the trial). “Why do you all care so much?” I thought to myself. This woman, guilty or not, has had her private life thrown in front of the spotlight, like some endangered creature new to the local zoo, with all manner of people pointing at her and whispering opinions about her guilt. Where do you people come off?

As my seething, hypocritical temperament cooled, I remembered how apt this was to stick with my previous plans and finally complete my first entry for HIDIA: a look at how we as fans have bought into this hyper-sensationalized, media-driven culture surrounding the world of sports

*    *    *    *    *    *    *    *    *    *    *    *    *    *    *    *    *    *    *    *    *    *    *    *    *

A little over 17 years ago, Arnold Palmer was playing his last round in the PGA, the New York Knicks were battling to win their first championship since the 70s, the New York Rangers were already receiving the infamous ticker tape parade through Broadway, and the World Cup was being kicked off in Chicago (which no one was really watching anyway).

And a white Bronco was driving down Interstate 405, trailed by a cadre of police vehicles and media helicopters, about to change the face of sports personalities forever.

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Statistics and the Inherent Mystery of Athletic Talent

Discussions of statistics in sports have a tendency to take on the qualities of a religious debate. They are couched in a language of true believers and the faithless, with little ground left for the practical few who are successfully integrating quantitative methods into their organizations. A recent Jonah Lehrer article in Grantland does an excellent job of illustrating the purposefully controversial and exaggerated writing that surrounds the topic (and everything associated with Bill Simmons). The article has a clear preference for argument over information, which would be forgivable — it is entertainment after all — if it wasn’t for the core lack of understanding Lehrer shows about the use of quantitative analysis and its place in the NBA.

The article uses the purchase of a new car as an analogy for basketball decision making, saying that you can’t just snap up a car based on its stats, specifically horsepower and miles per gallon. I agree (as anyone would), but it is a terrible analogy for the argument Lehrer is trying to make. The reason you should not rely on horsepower or MPG when choosing a car is that these numbers are not the best, or even very good, evaluative measures. They are decoy numbers pushed on those with a shallow understanding of cars. Flashy numbers that falsely claim to have significant descriptive power. To imply that using quantitative analysis is in anyway similar to purchasing a car based on these numbers ignores not only current NBA practices, but the very purpose of statistics.

The increase of quantitative analysis in the NBA is teaching coaches, GMs, and owners not to rely on the flashy stats. The goal of quantitative analysts in the NBA is to move away from inefficient descriptors and find the measurements that can actually help to accurately understand player quality and predict game outcomes. The quants are leveraging their available information methodically and trying to make improvements to team evaluations.

There is nothing radical about the formalization of player evaluation or sports teams leveraging information using formal methods — it is only the introduction of advanced math that has sportswriters up in arms. Teams have long had formal systems in place that help scouts identify important player characteristics and standardized methods for evaluating these characteristics in different players. But throw in something that looks like this:
Logistic Function
and suddenly you’re obscuring the heart of the game. Sportswriters’ reactions to quantitative analysis has generally been a combination of fear of the unknown, macho posturing (“those nerds are missing the point!”), and premeditated controversy creation.

Not to say there aren’t terrible statistics and statisticians in the league, there are many. Quantitative analysis is a tool, and like other tools it’s all in how you use it. There is no “guaranteed success equation,” and bad GMs and coaches will make bad decisions with quantitative analysis. Thing is, they would make bad decisions without it. Several good GMs use quantitative analysis as a portion of their research process. They acknowledge the flaws in the methods, they consider the context, they test their results against their judgment and a multitude of qualitative evidence. Stats are not a shortcut, you still have to do the rest of your homework, but they are one more source of information to aid decision-making.

Getting back to the article’s substance, Lehrer rests his case on Mavericks coach Rick Carlisle starting J.J. Barea despite his low scoring, negative plus-minus, and poor shooting. “Although Barea’s statistics still look pretty ordinary — his scoring average fell in the Finals despite the fact that he started — the Mavs have declared that re-signing him is a priority. Because it doesn’t matter what the numbers say. Barea won games.”

In an article about the downsides of advanced quantitative analysis, Lehrer cites some of the shallowest and most inconsequential of statistics. The fact is that the Mavericks are one of the most quantitatively-aware teams in the league. They are able to look beyond Barea’s points per game or his raw plus-minus because of their use of stats — not in spite of it. Carlisle received constant analyses from the only bench quant in the league that showed the effectiveness of different player combinations. He verified these reports by watching tape, thinking about his lineups in the context of his long coaching and playing experience, and talking with his assistant coaches. And then he made some great decisions. Mark Cuban recently confirmed as much to Deadspin. To call this a triumph of quantitative analysis would require heavy assumptions, but to call it a case where quantitative methods were unable to explain the “inherent mystery of athletic talent” is ridiculous.

The author hits a couple more points that drive home his lack of real familiarity with advanced statistics. For reasons I cannot understand, Lehrer implies that the quant community is of the opinion that Nenad Krstic is an acceptable replacement for Kendrick Perkins. Krstic looks horrible on advanced stat sheets while Perkins is a effective scorer who boxes out, sets great screens, and is a force on defense (all things that have been quantified to some level). The fact that Perkins is a better player and a better fit for the Celtics is very easily shown through the stats if you look past points per game.

Lehrer then writes, “For reasons that remain mysterious, some teammates make each other much better and some backup point guards really piss off Ron Artest. These are the qualities that often determine wins and losses, and yet they can’t be found on the back of a trading card or translated into a short list of clever equations.”

Of course the most useful statistics are not on the back of trading cards. The fact is that quantitative analysis can and does measure the phenomena Lehrer cites. Quantitative analysis of lineup and player combination efficiencies are hugely useful and the effectiveness of particular defensive matchups is likewise readily quantifiable and being used to help smart teams win games.

In the end, the post’s subtitle says it all. “Sabermetrics can help teams identify hidden talent and turn regular sports fans into math nerds. But can the numbers lie?” No, numbers cannot lie. They can be misread, they can be taken out of context, they can be overvalued, but they will not lie. That’s not how math works. It isn’t a silver bullet or an algorithm that gives a single well-defined answer. It is not playing fantasy basketball. It is not comparing the backs of trading cards. It is thinking about basketball in the most formalized way possible in an effort to remove traditional biases and provide an alternative perspective on players and the game. It is nothing to hate on, it is never going to dominate sports, but it might force some journalists to take a math class.

More on Gender and Basketball

If you’ve just tuned in, our debate is currently centered around the following question: Why are there not more female referees, coaches or general managers in the NBA?

And relatedly: Is it legit to criticize a higher-ed diversity institution’s decision to award the league an “A” rating?

Paolo, the “missing truths” that you point out are largely irrelevant, or only serve to illustrate the depth of the problem. I’ll start with your mention of men’s superior athletic capabilities. This may indeed be a reality, but by no means does it follow that men thus make better cops and soldiers. Brute strength may contribute to success in such positions, but there are other, equally important attributes: intelligence, strategic thinking, quick wits, a critical eye are a few that come to mind. It should go without saying that this is true of referees, coaches and general managers as well (these positions actually require little-to-no athleticism, but a lot of analytic and communicative skills).

There’s a lot of literature on how men and women think differently, by way of both genetics and sociology (see, for instance, the debate over women’s jurisprudence). Sports teams spend enormous amounts of energy exploring tiny potential competitive advantages. To the extent that we can agree that women bring different skills to the table, it seems obvious that involving them in a team’s strategic thinking stands to be an advantage. It seems equally obvious that a woman is bound to be the most qualified person for positions that require such diverse skill sets at least some of the time.

A quick digression: It’s worth exploring more carefully how we, as a society, create narratives about what makes for a competitive advantage, and how gender plays into that. This mainstream notion of female competitive inferiority isn’t limited to athleticism — it also figures prominently in how we think about female politicians (Hillary comes to mind: will she make the tough decisions when it counts? Can she stand up to the mockery of sexist foreign officials?), stock brokers, lawyers…Of course, these narratives also influence women’s career decisions. I’ll keep this can of worms closed for now.

Returning to the substance of your response: I’m equally put off by the experience argument, and I think a single example is suffice to counter it: Nancy Lieberman is a proven champion at every level of hoops, and she’s played at high levels with men. Stan Van Gundy, on the other hand, played a little ball in college. Yet it’s still seen as roof-shattering progress when Lieberman manages to earn the respect of a couple D-Leagers. I’m not at all sold that the NBA hires, as you posit, “based on quality alone.”

To return to your first point: Yes, Christian white males generally dominate positions of power. Of course this isn’t just an NBA issue. My problem here is that a higher-ed institution tasked with advocating diversity is handing out an “A” to a league that is still a boys’ club. In theory, this grade should have some weight, signifying that this organization is an exemplar in a fucked-up world; that we’ve achieved our goals of equality. This is not the case. Not even close. It’s bullshit, and I insist on holding both academia and professional sports to a higher standard.