NBA Expansion Discussions at Summer League
As the NBA’s board of governors convenes in Las Vegas during the summer league, the topic of expansion is prominently featured for fan bases in cities like Seattle and Las Vegas. However, the desire to add new teams may not be as robust as once thought.
Current Sentiment Among Owners
Recent insights from senior team officials and individuals familiar with certain owners’ perspectives indicate that while Seattle remains a favored candidate for a new or relocated team, there isn’t a strong consensus among governors to expand beyond the current 30 teams at this time.
Media Rights Impact on Expansion
A key factor contributing to this hesitance is the NBA’s upcoming 11-year, $76 billion media rights agreement, which starts next season with partners like NBC, Peacock, and Amazon Prime, in addition to existing partners ABC and ESPN. Warner Bros. Discovery, a previous broadcaster for NBA games since 1989, did not secure a place in this new agreement.
Distribution of New Revenue
Many owners would prefer to begin sharing the substantial new revenues among the existing teams rather than adding new franchises that would also take a share of these earnings. While expansion is a topic of discussion, the board will also review updates on the sale of the Boston Celtics to a group led by Bill Chisholm, projected to exceed $6.1 billion.
Future of the NBA and International Ventures
NBA Commissioner Adam Silver has recently moderated his remarks on the inevitability of expansion, indicating a slowed timeline as the league navigates recent ownership sales. The NBA is also exploring the establishment of a European basketball league in collaboration with FIBA, signaling potential global outreach.
Resistance to Rapid Expansion
Comments from podcaster Bill Simmons suggested that Knicks owner James Dolan is significant in the resistance among owners against expansion. However, sources indicate this sentiment is not solely driven by Dolan, as other owners question the need for immediate action.
Considerations for Future Expansions
According to industry analysis, the financial calculations suggest that introducing new teams could dilute revenue from national television deals over the coming decade. While potential expansion fees for new teams in places like Seattle or Las Vegas could be around $5 billion to $6 billion each, the NBA is contending with a shifting local media landscape, prompting some teams to seek alternative broadcast solutions. The league has maintained its size at 30 teams since 2004, and while expansion seems inevitable, it may not happen in the near future, particularly as owners aim to consolidate their revenue first.
