Report: NBA Facing $1 Billion In Losses, Record Salary Cap Plunge
The global coronavirus is costing the NBA more than just games. It is also resulting in a loss of business, and when it comes to pro basketball, that business is big.
More specifically, the league is facing its greatest financial challenge of the modern era, with the season suspended and revenue coming to a halt.
A recent report from Ben Golliver of The Washington Post suggested that the stoppage in play "could push the NBA’s revenue hit past the $1 billion threshold, according to team executives and media estimates."
Those estimates are based on the idea of the regular season and playoffs being cancelled.
So if the league truly is open to restarting the season in mid-July and finishing in late September, as has been reported by ESPN, we know why.
Playing games means money. Not playing them means reshaping the league's financial picture, perhaps for years to come.
As for the salary cap, Golliver cited articles written by other league insiders to explain just how steep of a hit the NBA could take.
"John Hollinger, a writer for the Athletic and a former Memphis Grizzlies executive, estimated that those losses could translate to a salary cap decline of $8 million next year, easily the largest ever, even if Silver can salvage the playoffs," Golliver wrote. "A Bleacher Report estimate said the salary cap hit could reach $15 million if the season is lost."
Now, it's much too early to say if these dire financial predictions will come true. While the league will undoubtedly face a drop in revenue, it could salvage at least a little by resuming play and eventually crowning a champion.
But if the salary cap does indeed take a major hit, how organizations go about building a winner will change dramatically.
It will be based more on finances, and not just stockpiling talent, because you need money for lots of talent. If what so many are predicting becomes true, the money just won't be there. At least, not like it used to be.
Basically, by the time this has all settled, we may be looking at a very different NBA.
Sam Amico covers the NBA and Cleveland Cavaliers for SI.com. Follow him @AmicoHoops.