NEW YORK -- Just past 9 p.m. on Monday, minutes after a seven-hour collective-bargaining session between the NBA and the players' association had wrapped, a solemn David Stern emerged and delivered the bad news: The first two weeks of the regular season had been canceled. Later, as deputy commissioner Adam Silver, union president Derek Fisher, executive director Billy Hunter and outside counsel Jeffrey Kessler addressed the media, there was a palpable sense that these would not be the last cancellations, either.
After weeks of arguing over how to split the basketball-related income -- if the owners would accept a 52.4 percent of the split for the players, if the players would go down to 47 percent or if the sides would split the difference at 50-50 -- what caused the latest breakdown in negotiations were disputes over system issues, which include:
• Length of contracts. Union sources said the players agreed to reduce the length of contracts from five- and six-year deals to four- and five-year deals. The league, sources said, asked for three- and four-year deals.
• Salary-cap exceptions. The NBA reportedly asked for the midlevel exception to be lowered from $5.8 million to $3 million.
• Annual raises.
• The amount of money a team must pay for exceeding the luxury-tax threshold.
"It's disappointing," Stern said. "We just couldn't get over the system hurdles."
That last one -- the dollar amount a team must pay for every dollar that exceeds the luxury-tax threshold -- was particularly troubling to union representatives. The owners have pushed for stiff penalties for teams that exceed the tax line. The owners' goal is to prevent big-market teams (like the New York Knicks and Los Angeles Lakers) from simply outspending small-market teams. The union views those penalties (believed to be more than $4 for every $1 over the tax) as a de facto salary cap.
"My attitude is, if it quacks like a duck and walks like a duck and it looks like a duck, it's a duck," Hunter said. "We came up with proposals to stiffen the tax, but we do not want a hard cap. You can't say, 'OK, we agree we're going to move away from a hard cap,' but then do everything else that brings about the same result."
Said Kessler: "The BRI isn't going to doom the season. The hard cap will doom the season."
With both sides retreating to neutral corners -- no new negotiating sessions have been scheduled and neither Stern nor Fisher could say when the two sides will talk again -- the question becomes: What's next? Stern hinted that the league will likely cancel the next two weeks of the season two weeks from now. He also suggested that the revenues lost as a result of the lockout bleeding into the regular season, revenues that are expected to number in the hundreds of millions, will be factored into the next proposal.
The union believes the league will wait for the players to break, that the loss of a paycheck or two will make the players willing to accept the deal the owners have on the table. Hunter said that would be a mistake and multiple players texted SI.com that, after learning details of the owners' proposal, they were resolved not to agree to it.
"They want us to say we can't miss checks and just take the deal," texted one All-Star player. "It won't happen. We are standing firm. Everybody thinks the players are being greedy, but when it's all said and done, we are giving up a lot."
How quickly these system issues are resolved will likely determine when the league gets back to work. Stern has frequently said that if the system issues can be agreed to, the economic ones -- specifically the BRI -- are close enough that a deal can be made. On Monday, Kessler suggested the same. Getting the system issues settled, however, is looking like a tall task.
"The NBA is more dug in than before," Hunter said. "[The owners] are going to have to soften their position and be willing to compromise."