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PRO LABOR TALKS / WHERE WE ARE NOW : NBA : MARK HEISLER
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Unless they lose season, each side will end up OK

The doomsday scenario isn't that one side or the other will make a bad deal, but that they won't be able to make a deal. In the end, the owners will be better off, and the players still rich.

May 30, 2011|MARK HEISLER

CUT OFF AT THE IMPASSE

Disputes between players and management threaten the seasons of two premier U.S. pro sports enterprises

The NFL is in full lockdown (or lockout) mode; the NBA might follow suit once the Finals are done and its labor agreement expires. Players and team owners in both sports say publicly they want an agreement, but the reality is any accord in either sport may be quite a way down the road. No one has indicated much willingness to give on major talking points, which could mean that for the first time, two major sports could be shut down by labor discord at the same time. The big question for fans: Will games be lost? The NFL season is three months away; the NBA five months. Sam Farmer and Mark Heisler raise the questions and fill in some of the blanks of what lies ahead. C3

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MOST RECENTLY

NBA

May 24: Players filed an unfair labor practices charge against the league with the National Labor Relations Board. The players are also seeking an injunction to stop the league's threatened lockout when the current collective-bargaining agreement expires June 30.

Key dates (assuming they need one month from the day they make a deal, as they did in 1999):

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To start on time: Oct. 1, 2011.

To start by Dec. 1: Nov. 1.

Drop-dead date: Jan. 2-7, 2012. It was Jan. 5, 1999, the last time, so both sides could get their people together after the holidays for a final vote.

When NBA owners will cave: They won't.

If anyone would pipe up, as the Indianapolis Colts' Jim Irsay did in the NFL, saying he and the Colts' player representative could make a deal over lunch, NBA Commissioner David Stern would fine him $1 million.

Stern, master and commander of his side, is under more pressure from owners than ever before.

Assuming he's in charge, he'll close when the numbers tell him he has what he needs, relative to the damage done by staying out longer and the risk of burning a season, or seeing the union decertify and file an antitrust suit, as the NFL players did.

Stern's problem is reconciling his many have-nots with his super-rich teams, led by the Lakers, Knicks and Bulls, who are dead-set against baseball-style revenue sharing, which distributes 10 times as much as the NBA does, so that almost all baseball teams operate at a profit.

If Stern loses control, next season is in big trouble.

When players will cave: I don't think they will.

If race, the subtext of everything in the NBA, is the elephant in the room, the historically unionist and now predominantly African American National Basketball Players Assn. has shown great solidarity.

NBA players were the first in sports to form a union in 1964.

They were so strong, it wasn't until 1999 that the owners first dared to mess with them while baseball owners locked their players out over and over, trying to break their union.

It, nevertheless, remains an item of faith among NBA owners the players will fold even if they didn't in 1999, the only time they were ever under the gun.

Under far more difficult circumstances, the players went to the drop-dead date without uttering a peep with NBPA Executive Director Billy Hunter in his first negotiation, fighting Stern and super-agent David Falk, who had packed the union leadership with his clients and favored closing the show down.

With Stern resigned to a shutdown, he was prevailed upon to make a final offer hours before his owners were to vote on pulling the plug. The union rank-and-file then overcame the forces of Falk and accepted, with three no votes.

The union has no rifts now with working-class-hero Derek Fisher as president and the owners seeking tens, or hundreds, of millions more than in 1999.

Biggest issue: Money, honey.

Hunter all but signed off on givebacks in the nation's dark days of 2009, agreeing to reopen the deal, which had two-plus seasons left on it.

That leaves one question -- how much? Despite the owners' talk about a hard cap, it remains to be seen what they will go for when it comes down to structural changes or money.

Stern first asked the players to assume millions in expenses, take the owners' 43% in basketball operating revenue and give them their 57%.

This was a 40% giveback, and a nonstarter.

The owners are reportedly now at 30%, another nonstarter.

Stern is thought to really want 50-50.

Personally, I think the owners are due some relief, if hardly what they have asked for.

Forbes, using accounting standards such as those publicly held companies used to report earnings, projected a $150-million operating profit last season, although it had only 12 of the 30 NBA teams making money.

(The NBA disputes Forbes' number. Stern has said they lost more than $250 million, including non-operating costs, such as debt service.)

On $3.6 billion in revenue, $150 million would be about a 4% return.

Businesses typically expect at least 10%, which would mean the owners need $210 million more.

A 51%-49% revenue split would accomplish that.

Biggest red herring: The NBA's economic model is broken.

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