It took three years, but billionaire Bob Johnson has now officially joined George Shinn in the poor-mouth club. Johnson, along with Shinn and six other NBA owners, are begging David Stern for a bailout. The owners claim that without a chunk of the local TV revenue made by major market teams in New York and Los Angeles, smaller markets like New Orleans and Charlotte are doomed.
Better still, the big Bobcat’s steadfast refusal to talk to local McClatchy NBA beat writer Rick Bonnell about the situation has finally sent Bonnell over the edge. Today he stops waiting for an audience with the Top Cat and asks some questions that should worry fans of the $265 million Uptown arena.
To wit:
How will the Bobcats maintain the arena?
The Bobcats run the arena, which also means they maintain it. That’s a sizeable public asset and upkeep must be expensive. If the Bobcats are destined to be in the red most years, will they spend what they should to keep the arena gleaming?
What happens when Johnson gets sick of losing money?
It’s just about impossible to move this team, because the penalties in the arena lease are so expensive (essentially, as it’s been explained to me, you’d have to pay off whatever debt is left on the construction cost).
But what stops Johnson from selling the team or just running it on the cheap? I don’t think the city built this arena to house the NBA-equivalent of the Pittsburgh Pirates. I don’t believe Johnson wants that to happen, but cost-containment certainly is in his nature.
I’d love to discuss all this with Bob, and I’m sure the public would be interested in his answers.
But I hear it’s none of my business and apparently none of the public’s, either.
From the very outset Johnson balked at the established sporting norm that you had to spend money to make money. Not willy-nilly Dan Synder or Paul Allen spending, but you had to invest in your on-the-court product from time-to-time. But Johnson really has not done that. As New York Sun scribe John Hollinger says about the revenue complainers:
Johnson is only his third season and he’s barely spent a cent in Charlotte, so it’s not surprising his TV revenues are disappointing.
Then there are the two refugees. Shinn essentially nuked one of the league’s strongest markets in Charlotte before choosing, of his own volition, to move to the league’s smallest market in New Orleans. [Michael] Heisley is another relocator, ditching Vancouver and choosing not Anaheim, nor St. Louis, but rather tiny Memphis. In each case, they made the move because local government handouts offset the tiny TV revenues, so it’s a bit rich for them to feel entitled to the Knicks’ and Lakers’ payouts after the fact.
See, the government handouts are the key. They have subsidized the creation of NBA teams in markets that, given the overall economic structure of the league, the local markets truly cannot support. Absent an owner willing and able to subsidize operational losses in the lean, non-championship contending years — which are usually most years — the smaller markets are indeed in trouble.
The early Hornets with Shinn are the exception that proves the rule. Bad Hornets teams lead the league in attendence and the new old Coliseum was throwing off so much cash the city went and built a white elephant of a convention center with it. But as soon as Shinn had to start spending real money for good players, he was back before the city begging for a new arena with more luxury boxes. This was the seed of what drove the Hornets out of town.
City Manager-for-Life Pam Syfert was supposed of have fixed all this with the new Uptown arena. It would be built to NBA-specs, small but with tons of luxo boxes close to the floor. But Johnson and company badly misjudged the local demand for the NBA, pricing and marketing it as a luxury good. This further alienated the basic local basketball fan from the franchise and, despite ticket price cuts this year, there is little sign a Bobcat game is a must-see event. Live or on TV.
In fact, any honest ranking of local fan interest would have to put the NBA far down the list, certainly behind the Panthers, NASCAR, and college hoops.
That’s the state of play heading into 2007. If Bob Johnson can live with that reality, then the taxpayers who built his arena need to hear that from him. If he is looking to bail and sell the team, that’s fine too. Just level with us.
We seldom get a straight answer from anyone around here.
