Salary cap could jump from $63 million to $91 million with new TV deal, league wants to “smooth in” increase
This is what the new television deal means for the basketball side of the NBA:
The salary cap, which is at just over $63 million this season, could jump all the way to $91.2 million in the summer 2016, according to Ken Berger of CBSSports.com. (That number assumes the full $2.68 billion a year the league will get on average in the new television deal starts that high out of the gate, Zach Lowe of Grantland says it starts at $2.1 billion, but that still puts the cap in the ballpark of $85 million.)
Or, look at it this way: Under the new television deal, if LeBron James signs a max contract in the summer of 2016 it will be worth about $6 million to $8 million more a season than the max deal he just signed this past summer ($20.6 million this season). Which is why even if he picks up his extension for the 2015-16 season he will be, without a doubt, a free agent in the summer of 2016. As will Kevin Durant. As will a number of other players.
Those numbers are estimates, but they are not going to be far off. That flood of cash could have all sorts of unintended consequences around the league and it has teams concerned and trying to alter their plans. At the press conference announcing the new television deal with ESPN and Turner Broadcasting (TNT), NBA Commissioner Adam Silver discussed wanting to smooth out that massive flood of new money into the market.
“When this deal kicks in in 2016-17, it will lead to a substantial increase that year in the salary cap,” Silver said Monday morning in New York where the announcement was made. “There is precedent for smoothing that increase in, something the NFL negotiated with its players association when it then entered into large increases to help teams in the planning process, essentially smoothing that money into the system.
“I had a brief conversations with Michelle Roberts, the new head of the (players’) union, on Friday to tell her these new deals were coming, and in fact we have a meeting later this afternoon to gauge their interest in creating a smoothing effect. I mean they will get their 51 percent no matter what, it’s just a question of how it comes in in terms of the cap. It will have a profound effect and I’m sure the union has already begun studying it just as we have been studying how it will effect our system team by team.
“And a lot of is just happenstance in who has a free agent, who happens to have cap room, what class happens to be coming up. As we all know, certain players and agents have been timing their contracts so they would become free agents in 2016-17 knowing we would be entering new television deals.”
For the record, the NFL smoothing wasn’t really all that smooth, teams were caught off guard this year by the jump in the cap.
That said, phasing in the massive cap increases rather than having one massive jump in two years likely makes sense to the owners, and it gives franchises time to adjust their plans on roster building accordingly.
The NBA players union might be open to smoothing things, out, if only to ease concerns in their own house. As Zach Lowe put it at Grantland:
However, if they are going to give they are going to want to get — and not just the money owed. The players feel (rightfully) they got hammered in the last CBA and they are not in the mood for concessions just to be nice, or for “the good of the game.” Franchise values are skyrocketing ($2 billion for the Clippers sticks with a lot of players) and they will only climb higher as the owners get this new flood of cash. Roberts and the players union isn’t going to just help out the owners because they’re nice.
All of those concerns will roll over into 2017 when the players will likely opt out of the CBA and push for more concessions.
The money on the table has certainly gotten everyone’s attention.