As NBA's board of governors meets Tuesday, is it ready to move forward on expansion?

New York Times

a day ago

As the NBA's board of governors meets Tuesday afternoon at Las Vegas summer league, the subject of expansion is front and center for fan bases in Seattle, Las Vegas and other cities hoping to join the league. But the appetite for adding new teams might not be as strong as previously believed.
Multiple senior team officials and people with knowledge of at least some owners' thoughts have told The Athletic in recent days that while Seattle remains a top candidate for a new or potentially relocated team among owners, there is not overwhelming momentum among governors to immediately expand past the current 30 teams.
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Central to that reticence is the league's new 10-year, $76 billion media rights deal, beginning next season, with new partners NBC, Peacock – NBC's streaming service – and Amazon Prime, along with existing partners ABC and ESPN. Warner Bros. Discovery, which had broadcast NBA games since 1989, was left out of the new deal.
Several owners would, at present, rather begin collecting and splitting the massive new revenues among the existing teams, rather than bringing in new partners that would also receive a cut of the financial pie.
Along with a discussion on expansion, the board will get updates on the pending sale of the Celtics to a new ownership group headed by private equity firm magnate Bill Chisholm, a deal that is ultimately expected to be approved for more than $6.1 billion. A vote on the sale will not be taken in Vegas, however.
In addition, teams will get updates on the potential new European basketball league that the NBA is endeavoring to create with FIBA, basketball's international federation.
NBA commissioner Adam Silver has, in recent months, softened his public comments on the inevitability of expansion and relayed that the league's timetable has slowed as it processed sales of the Celtics and Lakers. The NBA has also set its sights abroad and could launch the new European basketball league in the next two to three years.
'I view that as a form of expansion as well,' he said.
Podcaster Bill Simmons claimed last month that Knicks owner James Dolan was central to the resistance among owners, claiming Dolan leads 'a little cabal of anti-expansion owners' that will block potential expansion. But people with knowledge of at least some owners' thinking say that sentiment is not only being pushed by Dolan.
'It's more than JD,' one senior team official said last week.
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A senior team official from another team opined that the league was less inclined at the moment to push for expansion, after finally getting the new media deal done, on top of the new collective bargaining agreement reached in 2023, and that at least some owners agree.
'There are people who are, I wouldn't say rethinking, but asking why we need to move as quickly as we expected,' the official said. But the official added that the likelihood is still that the league will ultimately expand – just not right away.
Another NBA owner shared that sentiment and said he believes expansion will still occur, though he did not put a timeline on the process.
The math is the math. Each current team is set to collect hundreds of millions of dollars over the life of the new rights deal – a welcome salve as many teams deal with the rupturing of the regional sports network model. One industry source believes that, collectively, NBA teams have lost nine figures' worth of revenues over the last year or two, as local RSNs collapsed.
'They want to see how the new TV money plays out next year,' a senior executive from another team said.
In March, Silver said that that was 'giving me just a bit of pause' in the context of expansion. While the NBA has that handsome national media rights deal, the local media rights landscape has atrophied in recent years as a number of regional sports networks have gone into bankruptcy or flirted with it and revenue to teams has dropped. A handful of teams have scrambled with local TV stations to put their games on over the air. Utah introduced a local streaming service for its games, Jazz+, in 2023.
Adding two new teams within the next year or two would dilute the potential revenue from the national TV networks significantly over the next decade. So there's sentiment to let current teams pocket at least some of the new money before cutting anyone else in.
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The NBA would draw boffo amounts in expansion fees if it does add two new teams. An expansion team in Las Vegas or Seattle has been expected to go for around $5 billion-$6 billion apiece, but that number might need an adjustment after the Celtics sale — for a team that does not own its arena or the land around it — and the $10 billion valuation the Lakers drew.
Silver said during his news conference at the finals last month that 'the current sense is we should be exploring' expansion, but didn't think it was 'automatic, because it depends on your perspective of the future of the league.'
'As I've said before, expansion in a way is selling equity in the league,' Silver said. 'If you believe in the league, you don't necessarily want to add partners. On the other hand, we recognize there are underserved markets in the United States and elsewhere, I think markets that deserve to have NBA teams. Probably even if we were to expand, more than we can serve. …It will be on the agenda to take the temperature of the room. We have committees that are already talking about it. But my sense is at that meeting, they're going to give direction to me and my colleagues at the league office that we should continue to explore it.'
There are, theoretically, workarounds to the television revenue question.
When the ABA and NBA merged in 1976, the four incoming ABA teams – the New York Nets, San Antonio Spurs, Denver Nuggets and Indiana Pacers – did not, as one of the requirements for joining the NBA, receive national television revenue in their first three years in the league.
Seattle has been the frontrunner to be made whole since the Supersonics left for Oklahoma City in 2008. The city has, in the intervening years, worked with the Oak View Group, which led the development project to gut and rebuild the old Key Arena, now called Climate Pledge Arena, which houses the NHL's Seattle Kraken. Climate Pledge was specifically developed to meet both NHL and NBA arena specifications.
Oak View has also announced plans to build a $1 billion arena with private money in Las Vegas for a potential NBA team there.
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The NBA has been at 30 teams since bringing the then-Bobcats into the league in Charlotte in 2004 as an expansion team. The Bobcats replaced the first iteration of the Charlotte Hornets, who relocated to New Orleans in 2002 after spending their 14 seasons in Charlotte. The New Orleans Hornets changed their name to the New Orleans Pelicans in 2013, with the Bobcats becoming the second version of the Charlotte Hornets in 2014.
Most of the established major U.S. pro sports leagues have stayed steady in the last two-plus decades. The NFL hasn't expanded since 2002, when it brought in the Houston Texans as its 32nd team. Major League Baseball last expanded to 30 teams in 1998, with the Tampa Bay Devil Rays (now the Rays) and Arizona Diamondbacks. The Kraken (2021) and Las Vegas Golden Knights (2017) were the last two NHL expansion franchises, bringing that league up to 32 teams.
However, the WNBA is in the midst of an expansion boom, announcing last month that three new franchises will go to Detroit, Philadelphia and Cleveland, with Cleveland beginning play in 2028, Detroit in 2029 and Philadelphia in 2030. That will increase the number of WNBA teams to 18. The Golden State Valkyries are in their first season in the NBA this year, and Portland and Toronto will begin play next season. Four of the six newly named franchises have owners who also currently own an NBA team, while Toronto is owned by Larry Tanenbaum, who is a minority owner in the franchise but the chairman of the NBA's board of governors.
(Photo of Adam Silver: FRANCK FIFE/AFP via Getty Images)