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Topps No Longer Tops With NBA

The NBA announced yesterday that they are ditching Upper Deck and Topps by granting an exclusive trading card deal with an Italian company named Panini.

It might have been another step towards putting the card industry into the grave.

I'm not saying it's the wrong move, it could have been necessary. But rather than the spin the leagues put on it, which is that having an exclusive streamlines the fragmentation and supply problem, let's call it what it is.

When a league does an exclusive with a company, it's normally because one company is willing to pay a ridiculous number in tight times. So it makes sense for the league to take the dollars.

Panini is a $1 billion dollar company and certainly expands the industry's worldwide footprint, but doing a deal like this blows up the distribution models long perfected by the industry dinosaur Topps and Upper Deck, which has been making NBA cards since 1991.

It also puts the league's most valued stars in a tough position. Upper Deck has exclusive memorabilia deals wth Michael Jordan, Kobe Bryant and LeBron James.

Exclusives are sold to the bidders as the opportunity to have a monopolistic marketplace at a premium. Selling that as something good to the consumer is a harder pitch.

I actually know of the name Panini. In 1989, Upper Deck's first year and my most rabid year of collecting, I collected the complete baseball Panini sticker collection and album.

I have no idea where they've been since but they certainly aren't top of mind here.

The idea that exclusives will save the card industry is not accurate.

The card industry is broken because it was based on a financial model that was inflated.

Think back to the golden age of card collecting (roughly 1986 to 1993). What drove it? A false sense of what things were worth. Everything was an investment. Why? Because people didn't understand why cards had value. Well, when no one's mother threw out the modern day cards, we quickly saw how worthless they all were.

I can't wait to see what Panini does. It will, at the very least, shake things up. But to think that it will put the card industry in any better shape than it is now is a pipe dream.

Questions? Comments? SportsBiz@cnbc.com