Lately, fans of professional basketball have not been riveted by play on the court, but rather by potential play in court. Mediators similarly have been paying close attention to this high-profile mediation, between NBA players and owners. Up until this past Thanksgiving weekend, the likelihood of an NBA season seemed slim. For several months, the parties had been locked in high-stakes, often vicious negotiations over each side’s portion of the league’s profits (and losses). But after a marathon 15-hour negotiating session, the two sides appear to have reached an agreement. In the process of coming to this 11th hour deal, there have been various mediation sessions and the players filed suit in federal court, seeking relief under antitrust laws.
Business Model
Over the course of several months, negotiations broke down, and the players were “locked out” by the league. The conflict was sparked as the collective bargaining agreement, last negotiated in 2005, expired, making room to revisit what, to many, had become a dysfunctional business model. Under the last collective bargaining agreement, 57 percent of the basketball-related revenues of the NBA went, in aggregate, to players’ salaries. While many may await LeBron James’ or Kobe Bryant’s return to the court, the reality is that superstar players are few and far between, and profitable teams are purportedly the exception rather than the rule.
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