http://offthedribble.blogs.nytimes.com/2012/02/22/as-lins-legend-grows-msgs-numbers-continue-rising/ February 22, 2012, 12:10 am 3 Comments As Lin’s Legend Grows, MSG’s Ratings Keep Rising, Too By RICHARD SANDOMIR Jeremy Lin’s drawing power — even in losses — is helping the MSG Network set ratings records. The loss to the New Orleans Hornets last Friday generated a 7.32 rating (which equals 540,788 local households). Then, Monday night’s game against the Nets led to an even higher rating, 7.34. Those are the highest regular-season ratings for Knicks games since the 1988-89 season, when MSG began measuring its audience. Friday’s game peaked at a 10.02 rating (740,259 households) between 10:15 and 10:30 p.m., while Monday’s broadcast had its highest rating of a 9.02 from 9:45 to 10:45 p.m. Both games exceeded the previous Knicks regular-season record of a 6.78 rating, for the 1995 game when Michael Jordan scored 55 points in his first game back at Madison Square Garden after he came out of retirement. The Knicks’ victory over Dallas on Sunday demonstrated the dual drawing power of Lin and a great game. ABC’s 4.8 preliminary overnight rating was the third highest among non-Christmas games carried by the network since at least 2004-5. And the 10.3 New York rating was ABC’s highest ever generated in the market for a regular-season game.
so the stock rose by $9+ (~30%) per share over the Lin's stay there, and it combines to...$71 mil? are we talking about MSG here, the multi-billion company, or some MLS soccer stadium? The numbers seem all off.
It's only mtm value anyway. The Lin bubble was irrational and it would have evaporated over the course of the season. So, they took a correction all at once instead of a more gradual slide. Losing mark-to-market value you would never be able to realize anyway isn't anything like losing a real $93m -- or even a real $25m + luxury tax! -- off your P&L. If you want to look at foregone gains, look at Lin's impact on TV deals (already in the bag), advertising deals, and ticket sales, not the movement in the price of an asset Dolan isn't selling. I think Dolan probably made the right choice, though that's based in good part on being bearish on Lin's basketball talent. Most editorializing and analysis I've seen though can't or won't go into the nitty gritty of impact on sales and revenues, instead asking us to imagine the possibilities or else pointing to indirect and unreliable indicators, like the stock price or Forbes valuation. It's a bet and in the end the wisdom of Dolan's choice will depend on Lin's performance. If he plays like an All-Star in Houston, everyone will keep calling Dolan a dumb-ass for letting him go. But, if Lin disappoints on the court, Knicks fans will be dancing for joy on the Rockets' grave for having dodged that bullet. Because if he doesn't deliver on the court, the ticket sales and the merchandising in China, and the advertisers will all go away, and Lin will not be worth his contract on the court or off.
There are 30 teams in the NBA. Only 1 team had Yao. Guess how much Les made from Yao? No one else knows, but Les. SO we have Lin now.
I know a lot about the stock market and Lin's effect on a multi-billion dollar corporation will be minimal. Besides NY already sold all of those season tickets and resigned their cable contracts at a much higher rate.
Putting money into bubbles full of "educated guesses", what could possibly go wrong? I think there's no doubt Jeremy Lin affects the dollar amount. If Lebron came to Houston, don't think that'd affect valuations? Though when Jeremy Lin didnt play in the playoffs, I think the "Linsanity" pretty much subsided. Lin in the playoffs woulda been must see TV. A Lin game winner would been magical. But Lin's non-D'Antoni regularized PG role in their new system, along with the anti-climactic end to a season is what brought things more down to earth and contributed to Lin coming to Houston. Going from Linsanity to just "fan favorite". And probably woulda contributed to LESSENING their stock price too.
I won't dispute that but saying he had minimal effect is incorrect. He helped resolve the MSG dispute which ended up adding money in MSG. That benefit won't go away, but his loss will still be felt. The drop in MSG stock price is probably people realizing ONCE AGAIN - OMG we've got a moron running the company, maybe I should sell. Because Lin is worth $8m a year overall. They lost a great asset FOR NOTHING. They could have traded him next year, or the year after that, or waived him and stretched the cap hit in the third year if they couldn't find a taker for his expiring. Also he was worth more than the carcasses of Felton and Kidd, and Novak was useless until he came along. Why complain about LIn and the cap when you just handed out $4/yr for Felton, $3.5/yr for Kidd and $4/yr for Novak, all on 3-4 year deals?
And the Linsanity continues. A lot of that stock price drop was due to uncertainty caused by negotiations over the MSG TV contract. Truth be told, that six part series explained EVERYTHING. It made no financial sense for NYK to match that deal as the luxury tax provisions would have rendered Lin untradeable. Folks here should give it a read (those who can read) because it points out in detail how Morey cleverly exploited the poison pill loophole in the new CBA to land Lin.
What is so hard for you guys to understand about what Lin's performance did for the ratings? They were absolutely titanic. It's not like people were just buying cause they were excited about Lin. They bought cause ratings were spiking huge. Further, MSG was already consolidating at 52 weeks highs so it was ready to break out on any positive news. The "Linsanity" was mega positive for ratings.
It clearly wasn't minimal. I know a little about the market too. Whether it was sustainable is another question, but to say it was minimal is just denying reality.
Outstanding analysis! Your last paragraph sums up my feelings on the matter quite nicely. My biggest fear is that all of this hype about Lin is setting him up to be the fall guy in case he fails to recreate his magic here. And that would be a shame because Lin is a likeable kid and still has room to grow as a basketball player. I just hope he gets the chance.
