That's right. They forever get a piece. So let's show you the math on this thing. Yesterday,
the NBA announced its new TV deal yesterday with ABC/ESPN and TNT. It's an eight-year deal that starts in the 2008-09 season. Under the deal, the league will be paid an average of $930 million per annum, as first reported by The Sports Business Daily.
That means for each of the next eight years, 26 NBA teams will make $31 million. The four former ABA teams will make $26.8 million. The Silnas will pick up $17 million and their attorney, who helped negotiate the deal, Donald Schupak collects $1.9 million.
The Nuggets, Spurs, Nets and Pacers, by the way, are actually giving more than 14.2 percent (1/7th) of their revenue to the Silnas and Schupak. This is because the math for the deal is locked in at 28 teams. So those four teams are actually giving up a greater percentage. Each of the Silna brothers gets 45 percent each and Schupak gets 10 percent of the total payday.
I've figured that since 1976, the Silna brothers have earned about $180 million, so they're total take through the 2015-16 season will be $320 million. Many people point out that if the Silnas did have the right to get into the league and still had their team, they would have paid $3.2 million for a team now worth some $320 million. What you have to remember though is that isn’t pure profit, like it is now.
I worked very hard of the last couple weeks to get the Silna Brothers and Don Schupak to talk, but I was unsuccessful. I did however (see video below) get some great storytellers--Carl Scheer, the former general manager of the Denver Nuggets and John Y. Brown Jr., the Colonels owner who took the $3.3 million payday instead:
What was the environment that led to the deal?
Scheer: We were in suicide mode. There was really no choice. We had no other negotiating power. We had no leverage with the NBA and we had to take care of our ABA partners.
Brown:Everyone was losing money and there wasn’t much hope for a future without a merger. Hopefully, we can get that video up. I left a space for it.
What was the outlook on the NBA TV business at the time?
Scheer: NBA television was modest at best. In fact, the Finals were delayed and were not shown live in the late 70s. There were those who understood what the future might bring for the NBA, but most so-called experts thought that pro basketball had a very modest future.
John, how did it come about - the $3.3 million for you?
Brown: They asked me, ‘What do you want?’ And I said, ‘Well, what do you think is fair?’ And they said, ‘Would you take two million dollars?’ And I said I would. Four hours later, after the Silnas went into the room, it became $3.3 million.
How did the Silnas pull this thing off?
Scheer:They had one thing going for them. They had the leverage in the sense that they were the kamikaze. They were going to go for it. If we didn’t agree to that, I was convinced they would take us all down.
Brown:They were a couple of rogues that were new to the league and they held them up for all they could get…As they say, there’s the truth and then there’s the real truth. The truth of the matter is, it’s about the biggest hold-up I’ve ever seen in business. It was highly unethical.