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June 12, 2012

Adam Silver


Q.  Isn't it ironic that the Thunder, who may be in a bigger market and could afford the luxury tax, are going to be more limited by the fact that they're in a small market, they can't afford the repeater tax and everything?
ADAM SILVER:  That's the precise point we made to the union in collective bargain.  That's why we would have preferred a hard cap, and if you don't have a hard cap, whether it's because other cities can afford it or because their owners have deeper pockets, teams are going to make decisions to spend more money.
The only thing I'll say is so far we're seeing Mark Cuban's behavior seems to have been altered based on the new collective bargaining agreement, the Lakers' behavior has been altered, so it's very difficult to predict.  It's an extraordinarily harsh tax once it fully kicks in.  You're right, though.  A team that has‑‑ because it's a soft cap, a team has the ability to spend more money than other markets, and it puts small markets at a disadvantage.

Q.  So is it irony that a small market who has done it as well as Oklahoma City has is not going to find itself sustainable?
ADAM SILVER:  Well, the fact that they won't keep the corps together doesn't mean the system is unsustainable.  The question is whether large market teams or big spending owners are willing to go significantly into the tax.  If we had had a hard cap which we had asked for, the outcome would have been the same for this team.  They would have had to make difficult decisions about players.  So that doesn't change.
The question is will those players aggregate in a certain market, and it's unclear yet what the impact of the agreement will be.

Q.  Why would the owners be in favor of this?
ADAM SILVER:  Well, the owners were in favor of as harsh a system as possible to discourage teams from spending far above the cap, so once we weren't going to get a hard cap, we put in measures‑‑ the union would say it acts as a hard cap.  I mean, we'll see.  From an ownership standpoint, we'd like it to act closer to a hard cap.  I think the notion we talked about with the union is that there be some flexibility.  If you thought you had a chance to so‑called go for it and it was worth for some period of time going over the cap a little bit, presumably you have a better team, you're also generating more revenue for that period of time, it would make sense, but you wouldn't live above the cap for a long period of time.  I really think it's difficult to predict behavior under these systems.  I mean, everybody said it'll be Prokhorov, people said it'll be the Lakers.  So far that hasn't been the case.

Q.  Any thought that maybe if you refined the routine for your own players, you're not punished as hard as under the tax?
ADAM SILVER:  I mean, there are those type provisions that have to do with sort of the tiering of the taxes and lower tax levels so you can go to a certain extent without being dramatically punished.  It's just a question of where you draw the line.

Q.  You wouldn't disagree that a team like the Thunder no matter how well they've done, they can't keep the team together?  The better you are at getting talent, you're going to pay a price later by‑‑
ADAM SILVER:  Yeah, but that's the nature of a hard‑cap system.

Q.  And the antithesis of what we had in the '80s when the Celtics' corps stayed together and the Lakers' corps stayed together‑‑
ADAM SILVER:  Right, but you also had Michael Jordan in his last year was making $30 million a year, just Michael Jordan, and that was back then.  And the question is could Oklahoma City have paid their stars $30 million a year in 10, 15 years ago dollars?  I think that's the very issue.  As David said, it requires a different distribution of players.
And it's a balance.  We both‑‑ we're not necessarily looking to break up teams, but again, it forces teams to make difficult decisions.

Q.  David said something about this year's finances being artificially high or it would be difficult to judge.  Is that because you got all the national broadcast revenue?
ADAM SILVER:  I wasn't exactly sure what he meant because I heard it, too, but I think this season is an aberration.  Yes, we got all the national television money, but of course we're still paying 50 percent of it to the players, and we lost a significant amount of sponsorship money and ticket money.  So I think that's also what he meant by it's an aberration.

Q.  The national broadcast revenue is by far the biggest piece of the‑‑
ADAM SILVER:  No, it's not.  It's about the same as ticket revenue, and we lost a lot of our‑‑ proportionally more of our international television.  I mean, in the case of ESPN, I think ultimately they got the same number of games domestically, and ABC obviously doesn't start until Christmas, and Turner lost some additional games, but we also had to do some things to format in the out years.  I mean, there was a negotiation over how to get all the money this year, but of course the players are the beneficiaries of that, as well.  I think what David meant is this year is an aberration.  You can't judge a collective bargaining agreement on this year's system.

Q.  You said it was going to be roughly break‑even this year.
ADAM SILVER:  Yeah, but I think it's roughly where we are, but we won't know for another couple of months.

Q.  Why do you think the lockout didn't kill the season?  Why do you think the ratings are high despite the lockout?
ADAM SILVER:  I think it's a lot of factors.  I mean, I credit the players, Derek Fisher's leadership, and the union, as well.  I mean, once we reached an agreement, there was no acrimony.  Everybody said let's get back to work immediately, and I think that made a big difference.  I think the social networks made a huge difference, that our fans remained engaged directly with our players, even though they didn't have the infrastructure of the teams to make them available to the media as they typically do.  I think the fact that we got the deal done by Christmas, were able to open on Christmas was significant.  I think it would have been significantly different if we would have gone into the calendar year because historically we've always marked the season on Christmas, that we were actually able to build a big promotion starting on Christmas.  I think all those things mattered, plus there's a large element of luck.  The competition was terrific.  We were able to build off the momentum from last year.  We have a terrific group of up‑and‑coming rising stars in this league.  You know, despite some injuries, overall, I think you're seeing two of the best teams meeting in The Finals, and that's what's supposed to happen.

Q.  Are you surprised that it turned out this way?
ADAM SILVER:  Yes, absolutely.  It certainly exceeded any expectations I had, and it wasn't just the fans, as well, but I think I credit our marketing partners, the networks.  Everybody rallied together to re‑launch the season.  Again, I think the Christmas Day games gave everybody a focal point to organize around.  But ultimately it's to the players' credit.  Once we got the deal done, and there was a lot said obviously in social networks, a lot said across the table, but once we got the deal done, everybody was back to work.
Even with some of the difficult injuries this year, I've heard very few players complain about the consolidated schedule or about the wear and tear of the season.  I mean, I read all the things you guys write.  I'd say none of them have said we shouldn't have played the season.

Q.  No, nobody is going that far, but they're complaining about‑‑ they're saying injuries have a lot to do with playing every other day.
ADAM SILVER:  I think personally the injuries have to do with the long layoffs.  And then arguably if we had laid off even longer, the injuries would have been worse.

Q.  That almost guarantees you're going to have lockouts every time now, since you didn't have to pay a penalty in terms of fan support and everything.
ADAM SILVER:  By the way, the players still lost 20 percent of their salaries.  I mean, they've lost 20 percent of their salaries, and the league took a huge financial hit, as well.  I think we still have a huge incentive to get new collective bargaining agreements done.
To your point, it's also the wear and tear on their bodies.  Again, I think the fact that we had a long layoff had a real impact on them.  I think it's probably more important than the condensed schedule.
Derrick Rose was out 27, roughly, games, and people were saying that was a result of the condensed schedule, which is hard to imagine.  I mean, who knows why a particular player gets injured, but for any of these athletes, as you guys know, the level of care from our teams, the amount of expense that goes into the training facilities, the trainer, the doctors and all that, it has to have a huge impact when they're cut off from that for a long period of time.  It's not good for any of us.

Q.  This is hard to quantify or qualify, but is there a long‑term impact on the league because guys like Derrick Rose, the fact that you don't know what caused them to get hurt in the first place?
ADAM SILVER:  You know, I think it's terrible when any player gets injured.  I think it's too early to say there's a long‑term impact on the league because Rose got injured.  I mean, like I said, who knows why he got injured.  I know he's an extraordinarily hard‑working young man, and I have every reason to believe he's going to be back and as good as he was.  I don't want to suggest there's a long‑term impact.

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