The NBA operates a salary cap as part of a US sports model that may not be compatible with Europe
The NBA is working on how it can apply its salary cap and revenue-sharing model to NBA Europe, its planned pan-continental basketball competition, says commissioner Adam Silver.
The basketball league operates a soft cap on teams’ salary spending and requires high-earning franchises to subsidise their poorer counterparts, part of a largely socialist model common to US sports that may not be compatible with European law if imported wholesale.
Speaking after a meeting of its board of governors in New York on Wednesday, Silver talked up NBA Europe but said many of the details were still being worked out.
“I think our basketball people now are very engaged in how the competition will work,” he said.
“Our lawyers are thinking hard of how we can take a system that’s now known to US sports as sort of a cap-based system and a revenue-sharing system with players and how we can apply that in a European framework.
“Nothing is easy here. There are reasons why this hasn’t been done before. But I think we’re up to it, and again, the response has been tremendous.”
The NBA hopes to launch a European league of 14-16 teams by 2027, an ambition boosted by talks between Silver, existing European clubs and potential investors in new franchises from private equity during a summer trip to Europe.
It has hired JPMorgan and the Raine Group to assess the market further, but the expectation is that NBA Europe would be a mix of some of the continent’s established powers from Spain, Greece and Turkey and new franchises from France and England – including London.
“I would say there continues to be enormous excitement around an opportunity there,” said Silver.
“The state of the game of basketball in Europe I think is fantastic. They have their own traditions, which we of course want to maintain, but we think there’s an opportunity to bring an NBA-style league to the continent and to take the game to another level.”
NBA Europe not only looking at football brands
Silver insisted that the NBA was not only interested in signing up teams affiliated with famous football clubs, such as Real Madrid, Barcelona, Fenerbahce, Panathinaikos and Olympiacos, and would take a market-by-market approach.
While the Gulf-based ownerships of Paris Saint-Germain and Manchester City are thought keen to bolt on an NBA Europe basketball team, London is seen as more likely to host a brand-new franchise that doesn’t share branding with a football club.
“I wouldn’t say it’s our preference to link with those well-known soccer clubs in Europe. I think that is one model, where particularly some of those incredible soccer brands in Europe have some of the biggest followings in the world behind their clubs, but also have basketball traditions as well,” said Silver.
“It’s a hybrid. I think we’re open to different approaches with a recognition that Europe is a big place. Cultures and sports traditions can vary very much, particularly in basketball, from market to market, country to country.
“Part of the work we’re doing now is to really drill down and say, all right, this is maybe the opportunity in this country, there may be an existing soccer club that’s very interested, but in this country over here, we need to start from scratch.”