After appearing on "The Strategy Session" on Friday, Sal Galatioto, president of Galatioto Sports Partners, continued the discussion off-air with Gary Kaminsky, about a potential lock-out in the NBA.
"I think there will be a lock-out in the NBA...it will be a very tough one and that's because the economic conditions of the league [aren't] like the NFL," Galatioto said.
"The current economic structure doesn't work. There have been a number of teams that changed hands—last year we represented the sellers on both Charlotte and Golden State. Right now Atlanta and Detroit [are] on the market, " he said.
But Galatioto added that players' salaries are a significant part of the cost structure that is hurting the NBA.
"They just pay out too much. The real bulk of the revenues are locally driven, unlike the NFL where you have a national media contract. Now the NBA has a national media contract but really the local cable contracts and pricing power and venue revenues are much more key in the NBA. So you have a hugh disparity between teams like the Bulls, Knicks and the Lakers and the second tier team—they just don't generate enough, he said.
Check out our entire conversation with Galatioto in this web exclusive to see why the NBA is losing money because of its business model.
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