Sports

NBA will lose hundreds of millions of dollars due to rift with China, commissioner says

Key Points
  • NBA Commissioner Adam Silver spoke to reporters before the 2020 NBA All-Star festivities on Saturday where he confirmed the league will suffer "substantial" losses following a rift with China last October.
NBA Commissioner Adam Silver speaks to the media after the Board of Governors meetings on July 12, 2016 at the Encore Hotel in Las Vegas, Nevada.
David Dow | NBAE | Getty Images

Though the National Basketball Association's tension with China have eased over the last few months, the financial losses still have yet to be felt.

Speaking at the 2020 NBA All-Star festivities at the United Center in Chicago, NBA Commissioner Adam Silver said the league has not determined how much revenue is lost due to games being off Chinese state television.

Silver said the NBA could stand to lose up to $400 million as its Chinese business partners cut ties with the league following social media comments made by Houston Rockets GM Daryl Morey last October in support of Hong Kong protesters.

"I think that the magnitude of the loss will be in the hundreds of millions of dollars," Silver said. "Certainly, probably less than $400 million, maybe even less than that."

In a now-deleted tweet, Morey said, "Fight for Freedom. Stand With Hong Kong," which caused a severe strain on the NBA's relationship with the East Asian country. Hong Kongers have protested for months over anxiety about Beijing's creeping influence over the city, which the British handed over to China in 1997.

The NBA publicly supported Morey's right to free speech in America, and though Morey did apologize for his tweet and has kept a low profile since, the financial impact remains.

Weeks after Morey deleted the tweet, Silver admitted the NBA suffered "substantial" losses as the rift intensified. On Saturday, he reiterated that information and confirmed it could also influence salary cap projections for next season.

Silver said the league "slightly" lowered its 2020-21 salary cap projection, which was expected to reach $116 million, due to "reduced revenue in China" and also "normal variations in business projections. So, I don't know yet where we'll ultimately come out," he said.

Silver added: "I think part has to do with what happens over the remainder of this season. So much of the value of NBA broadcast, for example, are back-loaded in the playoffs. So, we don't quite know yet where that will come out."

And if the cap declines, the NBA's financial structure for next season will weaken, and player salaries will be affected too, as contracts are tied to percentages of the cap.

Silver also mentioned the possibility of NBA games returning to China this year. With the USA Basketball roster filled with NBA players, Silver said pre-Olympic games could be moved to China while also considering another set of preseason games to be played this fall. However, Silver added the NBA does not plan to execute both options.

But despite the yet unknown losses from suspended business with China, Silver believes regular business will resume. He did not give a timeframe of when the NBA expects games to be shown on CCTV.

"I don't have any sense that there's any permanent damage to our business there, and as I've said before, we accept the consequences of our system and our values," Silver said. "It's not a position any business wants to be in, but those are the results."

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