Inside sports business
Yet another NBA franchise is out there for Steve Ballmer and Chris Hansen to pursue for Seattle.
And Ballmer’s appearance at a Los Angeles Clippers playoff game last week was enough to jumpstart the rumor mill that he’s interested in bidding. But as was the case with the duo’s recent failed attempt to land the Milwaukee Bucks, there is another seemingly insurmountable obstacle in their way — no matter how much money they throw around.
Bucks owner Herb Kohl had vowed beforehand not to let anyone take the team out of Wisconsin. In the same vein, NBA owners almost certainly won’t allow the Clippers to leave Los Angeles if they indeed force the disgraced Donald Sterling to sell.
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They play in the NBA’s second-biggest market, in a revamped Staples Center, where they’ve extended their lease through the 2023-24 season. Breaking that lease won’t be easy and the Clippers sharing the building with the Los Angeles Lakers and NHL’s Kings has kept arena costs relatively low and enabled Sterling to turn yearly profits on limited revenue.
The Clippers were already rated the NBA’s 13th most valuable franchise out of 30 teams at $575 million by Forbes in its latest round of valuations despite decades of on-court failure. Those finances still have room to grow with a much-improved team that’s primed for a new regional sports network deal after the 2015-16 season that could triple annual rights fees to $75 million.
Analysts had already estimated the pending RSN deal would add $200 million to the franchise value. With a host of celebrity bidders now lining up to buy the team, there is speculation the Clippers’ price tag could be headed towards $1 billion.
On that who’s-who list: Magic Johnson, Oprah Winfrey, entertainment mogul David Geffen and others with big money, and the sports and entertainment industry background that hits home with a broader base of fans.
That appeal makes it easier for the NBA to turn a PR disaster over Sterling’s racist remarks into something positive. Something that could lead to the Clippers becoming a more national brand.
Sure, they’ll never be the Lakers. But they’ve gained in popularity and their “Lob City” duo of Chris Paul and Blake Griffin could soon exceed the star power of the faltering co-tenant Lakers and the aging Kobe Bryant.
“I think there’s going to be exciting upside to the team upgrading its brand here in Southern California,’’ said David Carter, executive director of the USC Sports Business Institute and associate professor of sports business at the USC Marshall School of Business.
Carter has sensed “a groundswell of support for the team in Southern California.”
While he wouldn’t rule out a buyer trying to relocate to a nearby suburb like Anaheim – if they can escape the lease – he agreed it makes little sense to move them.
One reason is the positive publicity generated by the NBA with its tough stance against Sterling, turning a potential fiasco into a feel-good story. Fans across the nation are sympathetic to Clippers players and coaches and even rooting for them.
Want to blow this happy ending?
Allow the Clippers to be sold to a pair of relative unknowns, then let them move the team to Seattle for two seasons at KeyArena before a Sodo venue is built.
Just think about how Sonics fans feel about Clay Bennett, then multiply it by a thousand.
No, the NBA will never let that happen.
Carter said the Clippers’ lease agreement alone might prevent a move. Throw in their increasing popularity in Los Angeles and nationally, the pending RSN deal, celebrity ownership potential and the NBA’s PR coup, he just doesn’t see the team leaving.
“All of these things would have to really align in a negative way in order for the team to have to move.’’
To be fair, Ballmer attending a Clippers game is hardly an admission he’ll bid for them. His only real shot at winning a bid would be if he and Hansen forsake Seattle and become owners elsewhere.
That would go against previous statements of being in this to revive the Sonics. But a Clippers bid could actually help Ballmer and Hansen on that Sonics front.
First, it would show the NBA and Seattle fans that they’re still interested in a team, even if they privately know they have zero chance of moving the Clippers.
Second, the impression they’re willing to buy and keep a team in another city could pressure Seattle politicians to stay out of their way when it comes to eventually implementing their Memorandum of Understanding for a Sodo Arena.
But regardless, the Clippers aren’t coming here.
They aren’t the NHL’s Phoenix Coyotes, hemorrhaging fans and money and on the verge of being booted out of Arizona last year when the league viewed Seattle as a relocation spot. They are a club poised to dramatically expand their value and reach in a star-studded market that’s one of the NBA’s two biggest.
And in the process, help the NBA turn a PR nightmare into a dream win.
In other words, Ballmer and Hansen stand a better chance trying to move the Sacramento Kings here a second time.
Geoff Baker is a sports enterprise and investigative reporter who writes a column on sports business. Baker: email@example.com or 206-464-8286.