Money Flows as the NBA Regular Season Tips Off
The 1,230 games of the NBA regular season begin with two games on Tuesday, October 24. And as the league begins its 78th season of play, the financial health of everyone involved couldn’t be stronger.
The third-most valuable sports franchise in the world, as ranked by Forbes Magazine, is the Golden State Warriors at $7 billion. And the entire league as a whole has seen its value go up by 76% in just the last five years.
In 2022, the NBA topped $10 billion in revenue for the first time, and this year they are going to make $1.6 billion in sponsorship revenue alone. That does not include any money for broadcast or media rights, and only includes league, team, and arena sponsorship deals.
And the players are seeing a huge rise in salaries because of the boost in worldwide revenue, with the league’s highest-paid player, Stephen Curry, making $51.9 million in player salary this year. His total yearly earnings top nine figures at $100.4 million.
The First $100 Million Player
In 1996, Juwon Howard of the Washington Bullets signed the first contract worth more than $100 million. It was seven years for a total of $105 million. The NBA estimates that sometime in the next decade, we will see the first annual salary to top $100 million.
The NBA salary cap this season is a record $136.021 million. But with a new media rights deal coming in the next two years, by 2029 the cap and supermax contracts should expand enough to allow for annual salaries as high as $80 million. Within three years from that, it’is expected to top $100 million.
We just had a record set this summer when Jaylen Brown signed a five-year deal with the Boston Celtics for $303.7 million. And now that Damian Lillard is with the Milwaukee Bucks, his extension is projected to take him beyond the $60 million per year threshold as soon as 2026.
Coming Media Rights Deal
The current NBA media rights package ends in two years, and the competition to be at the table when the next deal is signed will be brisk, even as the NBA seeks $75 billion – a tripling in value of the current package.
The NBA wants three broadcast partners, including a streaming package that could involve Amazon Prime. It likely would be modeled after the current Amazon deal with the NFL, which has them featuring a game of the week. Amazon and the NBA would probably do the same.
Most appealing to the NBA is Amazon’s audience for the NFL, which is seven years younger than what CBS, NBC, and FOX draws for its NFL broadcasts. The NBA is currently negotiating with current partners ESPN and TNT. But adding a streamer like Amazon will be discussed before any deals are signed.
NBA Betting Wagging the Dog
One of the most talked-about new rules this season is the NBA’s policy on player rest, and the authority the league office has to pass out fines of more than $1 million for each violation of the rule.
Dallas Mavericks owner Mark Cuban says the biggest complaints came from the sports betting industry, and since they feed the revenue of the NBA, the league created the rule to please them.
“We’ve transitioned from a world of, ‘Hey, this is my team, I grew up a Mavs fans, I’ll always be a Mavs fans,’ to on social media, half the talk, if not more, is about ‘I’ve got this bet on this game, what are the odds going to be, what is the line going to be?’ And that influences a lot of perspective on load management.”
The NBA is projected to get $167 million in revenue this season from casinos and sportsbooks, which represents an 11% increase over last season.
In Colorado, the home of the defending NBA champions, more than $3 billion has been wagered on professional basketball since the state’s first legal sportsbooks opened in May of 2020. That’s $1 billion more than what was bet on the NFL over the same period.
The Denver Nuggets begin this season as the favorite in the Western Conference to reach the NBA Finals, paying +250 at BetUS.com. There are a large number of good online sportsbooks in Colorado, and Nuggets bettors are betting their team at an increasing rate.
The NFL remains the king of sports betting, with 81% of all bettors placing NFL bets. But betting on basketball and the NBA is the second-most popular sport to wager, with 54% of American bettors placing NBA wagers each season.
Two-thirds of those NBA bettors prefer to place their bets using online sportsbooks.