The N B A.

Continues the negotiation with the NBA Players Association about how to execute a season that may be played minimal fans allowed in their respective arenas.

As Brian Wynne horse explains, making them revenue and the math work undoubtedly will lead to sacrifice for the MBA to play next season, the players and owners have to come to an agreement about money before the Cove in 19 Pandemic, the MBA was expected to take in around $9 billion this upcoming season.

About 50% of that revenue would come from television and other media deals, and around 10% from other sources.

The remaining 40% was to come from arenas, but that 40% more than 3.5 billion is in jeopardy.

No one knows how many fans will be able to come to the games, and that is causing a problem.

NBA players and owners have a deal.

They both get about 50% of the basketball related revenue pie every year.

This half of the pie determines what the salary cap is, eh?

NBA teams based future player contracts on the expectation that the salary cap will continue to grow year after year.

That's how they can give out four year deals like the Lakers did with LeBron James back in 2018 and have been planning to do with Anthony Davis this year.

But with all the uncertainty about arena revenue, the pie the teams had been banking on for the last several years when signing players all of a sudden could be much, much smaller.

If the full pie or close to it isn't there, the whole financial system breaks down.

So what can be done?

The idea that the players and owners have is to pretend the revenue pie is there for this year and maybe next year, too.

This way the salary cap won't collapse on all of those pies over the next few years won't implode.

To make it work, every player will have to give back some of his salary to make sure that 50 50 split with the owners still happens from the highest paid veterans down to the guys who are on their rookie deals.

But how much smaller, maybe 30% maybe 35 maybe more.

With the owners now talking about shortening the season, players could be looking at fewer game checks to.

But there is little choice, thanks to Brian Wynne Horst on that.

So Zack Windy mentions the escrow where a percentage of the players paycheck is withheld until the final revenue is counted at the end of the season.

Do you feel that it is, Ultimately, this is where that uncertain revenue will be taken from?

I mean, if you're really committed to the 50 50 split, I don't really see how else to do it.

I mean, you could argue that maybe the owners should give back a little bit more because they're on balanced, much wealthier than the players are.

But that doesn't appear to be in the cards.

They appear to be sticking to the 50 50 split.

Aziz, when you mentioned keeping the system the way it works, and there is this assumption that well, we just need to ride out this year 21 22.

That's gonna be our return to normal.

That's why they wanted to get the calendar back to as close to almost possible for that season.

I mean, who knows.

Why are we assuming that?

And you know, the long term financial future is is really, you know, uncertain.

But you know, the n b a on the scale of things that actually really matter.

It is not very high on that scale, but yeah, I mean, this is a huge business that its model is for sure in jeopardy perk as a player.

How concerning is this?

It is very concerning.

And it goes to show you that we didn't make sure we did our job in the last C b A agreement and how the n b a one that deal.

But I was just more impressed about how peaceful Wendy was talking about billions of dollars at stake.

Like he was just so peaceful in that in that segment, it was crazy to me, but no, but in all seriousness, this what I was talking about earlier in the show, why it's so important that some of these guys get back toe work.

I know a lot of people be talking about all these people make these players make millions of dollars.

They shouldn't be worried.

They should be financially straight, but that's not it.

When you throw in taxes when you throw in escrow.

Ah, lot of these guys that are on the Lord tear they depend on the NBA salary and listen in the windy speak just now, it makes it raised concerns for me, for the players standpoint, Yeah, it's certainly interesting because look, some people, if you own a home, right, like you put certain money in escrow to pay for your property taxes.

And you know, those things are also tabulated from year to year, kind of like the salary cap.

And sometimes it's enough money, and sometimes you get a little refund.

You know, you get something back because you gave too much into the escrow.

All of this is still a huge unknown Zach, right?

Absolutely.

I mean, we're gonna have to see what the revenue looks like, not just this year, but next year.

And and to your point, this formula has been in existence before.

Sometimes the players get a refund, sometimes they don't.

But, you know, again, these this is what they're negotiating probably right now.

And the union is negotiating not only with the league, but within its own membership, because depending on how they structure this, whether they take a huge hit this year or spread the hit out over multiple years.

That affects different classes of players, different experience levels, different ages differently.

And that's a very complex negotiation in and of itself.

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