clock menu more-arrow no yes mobile

Filed under:

What the NBA's New TV Deal Means for the 76ers

What impact does the NBA's new TV deal have on the Philadelphia 76ers and their fans? We explain.

Adam Silver just made the NBA's players and owners a whole lot richer.
Adam Silver just made the NBA's players and owners a whole lot richer.
Brad Penner-USA TODAY Sports

There has been no shortage of articles discussing the impact of the NBA's new nine-year, $24 billion television rights deal on a macro level, but the new agreement has a direct impact on the Philadelphia 76ers as well as its fanbase.

1) More salary cap money for the Sixers... and everyone else.

The most obvious byproduct of a new TV deal is that the league's salary cap will grow substantially. How much that increase will be initially is anyone's guess: With such a dramatic difference between the current rights deal ($930 million/year) and the new one ($2.6 billion/year), the smart money says that the league will somehow ease its way towards a higher cap figure instead of implementing a massive jump in 2016.

Early projections peg the 2016-17 salary cap at roughly $80 million - a $13.5 million increase over the projected $66.5 million cap ceiling for next year. Multiply that number by 30 teams, and there will be more than $400 million in new money available for the 2016 free agent class - a group led by none other than Kevin Durant.

(LeBron James will also be a free agent in 2016, but if he were to leave Cleveland, it would be the biggest heel turn since Hulk Hogan joined the nWo.)

While Oklahoma City would still be able to give Durant the longest contract and the most money, there's nothing to prevent a team such as the Sixers from offering the Thunder forward a four-year deal starting at somewhere in the neighborhood of $24 million. As it stands now, the Sixers have exactly $0 committed to player salaries for the 2016-17 season (though there are $12.4 million in team options for Michael Carter-Williams, Nerlens Noel and Joel Embiid that will likely be exercised).

Assuming that the team retains its young core, picks up the $1 million option on Hollis Thompson, and signs Tony Wroten to a deal on par with his $3.2 million qualifying offer for the ‘16-17 season, that would put the 76ers at roughly $17 million, or less than 25 percent of the projected cap. Throw in the lottery picks that the Sixers figure to have over the next couple of years, and carve out some cap space for Dario Saric, and the Sixers still figure to be shy of the $30 million mark.

In theory, $50 million would be enough to sign multiple players to max deals, and that pool of money - paired with the prospect of playing with a young team on the rise - may be enough to lure a big-time free agent (or two) to Philadelphia. That said, there will be plenty of teams swimming in cash a couple of years from now, and the Sixers won't be the only ones willing to empty their coffers for a franchise-defining star.

2) Expect your cable/satellite bill to increase.

Disney and Turner have to raise the money to pay for these rights fees from somewhere, and that somewhere figures to be your wallet (for what it's worth, it's not a coincidence that Turner unveiled plans to cut 10 percent of its staff mere hours after the new TV deal was announced). TNT currently charges cable and satellite providers $1.24 per month per subscriber, while ESPN charges an industry-leading $5.75 per household - expect both of those figures to rise a fair amount in the coming years.

3) The deal makes "cutting the cord" a bit easier.

Part of the agreement includes the development of a new "over-the-top" distribution channel that will provide digital access to out-of-market games (something along the lines of the MLB At Bat app). The NBA and ESPN will be joint partners in the venture, but it will exist outside of the current WatchESPN umbrella. In short, we'll probably be treated to an enhanced version of the NBA's current League Pass Broadband option - one that provides online/on-demand access to all games (with the exception of those broadcast by Turner) without the need for a cable/satellite subscription.

4) Keep an eye on 2017.

Both the owners and the players' association can opt out of the current collective bargaining agreement at the end of the 2016-2017 season. The players gave up quite a bit during the last round of negotiations back in 2011, with the biggest concession being that they now receive a maximum of 51 percent of the league's Basketball-Related Income (BRI) as opposed to 57 percent in the previous CBA.

Given that the BRI pie will be quite a bit larger two years from now, the NBPA may decide that it wants a bigger piece of the action. Several players - including LeBron James and Deron Williamsare already looking ahead to the next round of CBA negotiations, so it appears that a work stoppage is inevitable.

Unfortunately, 2017 also figures to be the year that the 76ers turn the corner and become legit contenders in the Eastern Conference. Carter-Williams will already have four years of experience under his belt, while Noel and Embiid will (hopefully) continue their maturation towards becoming one of the best frontcourt duos in the league. From the Sixers' perspective, it would be a shame to see years of work (temporarily) derailed due to labor discord.

There is reason for optimism, however. Noted CBA expert Larry Coon thinks that the money will be so good in 2017, no one will want to leave any of it on the table as they quibble over a few percentage points. The fact that the new TV rights deal takes effect before the 2016-17 season is key: After the owners and players reap the benefits of their financial windfall for a year, both sides will be that much more motivated to settle on a new CBA before the threat of missing games becomes real (or less inclined to opt out altogether).

5) Joshua Harris just got a bit richer (on paper, anyway).

Three years ago, Joshua Harris led a group of investors who purchased the Sixers for $280 million (during the lockout, no less). Back in January, Forbes valued the team at $469 million - a number that figures to increase dramatically given Monday's developments.

Over the final two years of the current TV deal (which was purposely backloaded), the Sixers are set to receive $35 million annually from ESPN/Turner. Per ESPN's Marc Stein, each of the league's 30 teams is in line to earn twice that amount - approximately $70 million/year - in the early stages of the new rights agreement, and annual payments could reach $100 million by the end of the nine-year deal.

Harris and Co. appear to be committed for the long haul, but if the ownership group does decide to sell the team in the near future, the asking price would be considerably more than the $550 million Herb Kohl sold the Milwaukee Bucks for in April.

Sign up for the newsletter Sign up for the Liberty Ballers Daily Roundup newsletter!

A daily roundup of Philadelphia 76ers news from Liberty Ballers