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[SI] The Discount Dynasty

Discussion in 'NBA Dish' started by ahess99, Dec 14, 2009.

  1. ahess99

    ahess99 Member

    Nov 3, 2007
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    Pretty neat article about Lebron that I hadn't seen posted.

    Here is the link http://sportsillustrated.cnn.com/vault/article/magazine/MAG1162919/1/index.htm

    Global icon? Champion for the ages? Consummate team player?

    If these are indeed LeBron James's goals, then he's going about free agency all wrong. Instead of thinking big, he should think bigger. Instead of modeling himself after Michael Jordan, he should mimic Steve Jobs.

    In 1997, when Apple cofounder Jobs returned to the company as interim CEO, he famously accepted a salary of $1. It was a symbolic act, sure, but a potent one, the message being that he cared more about the growth of the company than the thickness of his wallet. Granted, he could do this because he would also receive a bazillion stock options, but that's the point.

    If I were advising LeBron—and clearly I'm not, or I'd be typing this on a gold-plated keyboard from a yacht in the Antilles—here's what I'd tell him: Forget pursuing a maximum deal next summer, and announce that you'll sign for the league minimum, the NBA's equivalent of a buck. It sounds crazy, but it actually makes business sense.

    Consider: At 24, after six seasons as a pro, James has made more than $90 million in salary. Throw in the $28 mil a year he makes in endorsements and other goodies, and he's already grossed more than a quarter of a billion. So you tell me what's more valuable to LeBron James Inc. in the long run—three years of max salary (around $50 million) or the cachet that comes from a) winning title after title as the linchpin of a superteam; b) being seen as the first star athlete to say, "It's not about the money," then back that up; and c) generating worldwide media buzz, if not the next best seller by Michael Lewis? "I think it's very smart," says one Western Conference general manager. "LeBron's personal brand is worth way, way more than any salary he could draw from a team. It's myopic to think otherwise." Then the G.M. laughs. "I'm just hoping he doesn't agree and do it."

    So does the rest of the league. Because get this: Under NBA rules, if James agreed to the minimum exception—which in his case would be a little more than $1 million—his salary wouldn't even count against the cap. (And if he signed just a three-year deal, he could still get his max contract in 2012.) By staying in Cleveland, James would be seen as loyal and inspirational while the Cavaliers stuffed themselves silly with big-name salaries—forget Dwyane Wade or Chris Bosh, how about Wade and Bosh? But LeBron could just as easily join Dwight Howard and Vince Carter in Orlando, or Kobe Bryant and Pau Gasol in L.A. Something tells me any of those lineups might just have a shot at winning a title. Or five.

    And if you think James is attractive as a pitchman and beloved by the public now, picture him outfitted in a ring and Robin Hood garb. He could even donate his minimum salary to charity, thus allowing Team LeBron its pick of slogans. Athletes always say they'd play the game for free—this year, the biggest one in the world will. "Sponsors would love it, and so would fans who are paying $200 for a ticket and $10 for a beer," says Bob Dorfman, author of the Sports Marketers' Scouting Report. "It would look like a smart, admirable move from a guy who's thinking about winning a championship, and he'd make a ton of money in endorsements. I don't see a downside."

    Sure, James's signing for the minimum would piss off the union (never settle for less!), not to mention David Stern (by undermining his beloved salary-cap system). But hey, other stars can accept minimum deals too. It's just that they never do—at least not until they're in their late 30s and desperate, like Karl Malone. And for anyone who argues that James's legacy would be tainted because he played on a stacked team, I ask you, Whose legacy was "tainted" more: Magic Johnson's for winning with Kareem Abdul-Jabbar and James Worthy or Larry Bird's for winning with Kevin McHale and Robert Parish?

    Of course the next time an NBA player leaves $50 million on the table will be the first, and for most athletes in their prime such an idea would be foolish. But then, LeBron isn't most athletes. When it comes to curating his image, he's always been a trailblazer—calm down Portland fans, that's a lowercase t—from essentially managing his own career to announcing last week that, as a gesture of respect, he would give up wearing Jordan's number, 23. And, like MJ, who walked away from NBA millions to pursue his dream of playing major league baseball, James can afford to take a big risk. "It's a very interesting option," says longtime Jordan rep David Falk, who is nonetheless loath to advise anyone to take less than the max because he's, you know, an agent. "The fact that he's earned a lot of money and has the financial wherewithal to make that decision makes him a unique candidate to do it."

    The concept works for corporate execs and musicians—remember Radiohead's surprisingly successful "pay what you want" policy for downloading its last album? And besides, lots of profitable concepts were once considered outlandish. Like, say, a computer company's expecting people to pay hundreds of dollars for a digital device that holds music. Yeah, that certainly didn't work out.
  2. Jebus

    Jebus Contributing Member

    Aug 1, 2001
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    I gotta say, right now I appreciate the talent that LeBron has, but I don't really consider myself a "fan", per se. But if he did this, particularly if he did it in Cleveland, I would definitely become a big fan.

    The possible storylines are endless, it's hard to even fathom. I mean, what kind of excuse is Mo Williams going to give when he's sucking it up in the playoffs while making 10 times as much as LeBron? Is Varejao going to hold out crying for more money when they're offering him 5x what LeBron makes?

    And how much pressure would it put on other superstars? Who wants reporters coming up to you asking you about your max salary when you just got worked by a guy making the minimum? Are you really going to complain about not having help on your team then? How would it affect future salary negotiations?

    But I suspect this is less like the Steve Jobs example (Jobs knew he'd be paid way more in the end if successful), and more like asking a billionaire CEO to take a voluntary 1% tax increase to pay for healthcare for 10000 of his company's employees- the benefits to him would be indirect and non-monetary (and largely non-quantifiable).

    I don't buy the argument that he'd recoup the salary lost through endorsements, etc. due to strengthening his image. His advertising image is pretty close to max strength at this point- who else could he endorse to make more? And could he possibly make more than the ~$17 million a year he'd be giving up in salary? It would have to really be about more than money.

    But for a guy who really seems to love the spotlight, this move would be huge. It's totally unprecedented- Tim Duncan's taking slightly less salary was a big deal, this would blow it away. People would be talking about it forever- people outside of basketball and even outside of sports in general. Come to think of it, maybe it would increase his profile enough to garner huge extras in endorsement money- isn't Accenture looking for a new spokesman?
  3. steddinotayto

    steddinotayto Contributing Member

    Aug 10, 2001
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  4. sbyang

    sbyang Member

    Oct 28, 2002
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    In your example 10000 employees benefited, who would benefit from Lebron making the minimum?
  5. ceonwuka

    ceonwuka Member

    Jun 27, 2003
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    As of now their only substantial contracts beyond this year are Varejao and Mo Williams. Cleveland could add Bosh/Boozer/Wade whoever...

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