The NBA has gained a reputation in recent years as being the closest thing we have in the United States to a fixed league. The accusations actually date back to 1985, when many argued that the first NBA Lottery was fixed in favor of the New York Knicks getting to draft Patrick Ewing out of Georgetown.
If you watched Game 6 of the Western Conference Finals between the Sacramento Kings and Los Angeles Lakers, you know that the NBA has fixed games in the past. Claims from Tim Donaghy that the NBA regularly fixes high profile games, including the aforementioned between the Kings and Lakers, were substantiated by an FBI investigation.
Earlier this year, we argued right here at Online Sports Marketing Guy that the 2011 NBA Slam Dunk Competition was fixed so that Blake Griffin could film his Kia Optima commercial in the final round. I stand by that position, and it is a constant reminder that even if they never do, the NBA does have the ability, and the willingness, to fix contests.
However, today I am here to offer 142 million reasons the NBA is not fixed.
Those reasons are $142,000,000.
This is my estimate for how much money has been left on the table during the 2011 NBA Playoffs. The real helpless conspiracy theorists out there will say that David Stern purposely didn’t fix this year’s playoffs to make up for recent transgressions. After all, it was just last month in the NBA Lottery selection when many people, including top NBA executives, cried foul that the Cleveland Cavaliers were awarded the top pick in the 2011 NBA Draft.
Nevertheless, $142 Million is a large amount of money for a savvy businessperson to leave out on the table, especially one who claims that the NBA will lose $300 Million this year (Stern gets more and more funny as he gets older; maybe he was confusing the NBA with the WNBA). The NBA is a private organization, so this estimate is compiled from several different sources, with varying levels of access to the actual numbers, but here is how I got to $142 Million….
In May of 2010, the New York Times blog reported that revenue for an NBA Playoff game varies widely, and can take in anywhere between $500,000 and $2.5 Million in tickets and concessions depending on the team and the playoff round. This estimate seemed to be validated by a recent Miami Herald report that states, by the most conservative estimates, the Miami Heat are poised to generate over $2 Million per playoff game in ticket sales alone. I also found a Forbes report from last year’s playoffs that reported the Lakers earned $1.67 Million per playoff game in 2010.
Ticket Sales and Concessions
Being that I only have relatively firm numbers on the Heat and Lakers, and to make the math easy and the estimate “generous”, I placed each team into one of two categories: Teams David Stern would want to see in the Finals, and teams David Stern would not want to see in the Finals. For the first group, I gave them an estimated revenue per game hosted of $1.5 Million. These teams include the Bulls, Heat, Celtics, Knicks, and Lakers. For everybody else, I gave them an estimated revenue per game hosted on the low-end of the New York Times report of $500,000. I then looked at how many games were played below the maximum of seven per round to determine how much money was theoretically left on the table.
Round 1 – $14.5 Million
Conference Semifinals – $8 Million
Conference Finals – $4 Million
Finals – if Dallas wins tonight, you can add $1.5 Million lost from missing game 7 in Miami.
Total (excluding Finals which are TBD): $26.5 Million
Of course, the NBA stands to lose much more than ticket and concession sales from short series – they also lose advertising revenue during their most marketable portion of their season. I won’t rehash the NBA’s stupidity for showing elimination games on NBA TV, but on average, the NBA earned just over $5 Million in ad revenue per game during the 2010 NBA Playoffs. This year, we have already missed 23 potential playoff games! That’s an extra $115 Million in revenue, unless the NBA is lucky enough to pass these losses onto the networks.
That brings the total money left on the table up to $141.5 Million. I donated the extra $500,000 in fake money to make a good title for the story.
Before tonight’s Game 6 between the Heat and Mavericks, there have been a total of 80 playoff games and only one series with seven games. Since the NBA made every playoff round a best-of-seven series in 2003, there has only been one season with less playoff games; 79 in 2007 (the second fewest were 82 in 2004 and 2010). The 2007 Playoffs were also the only other year with as few seven game series.
If the NBA was fixed, don’t you think David Stern and Company would milk these playoffs, during their run of unprecedented popularity, for all they’re worth?
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