NBA ticket revenues fall 7.4 percent

Per Ken Berger of CBSSports.com…

Average paid attendance is down 3.7 percent in the NBA through the first quarter of the regular season, sending gate receipts plummeting 7.4 percent, according to league documents obtained by CBSSports.com.

Why are gate receipts important? Bill Simmons explains…

The attendance number doesn’t matter because it’s so easy to manipulate; teams either fib or boost the total by giving tickets away for absurdly low prices, hoping to recoup some of it through concessions and merchandise sales.

Berger goes further…

They’re also important because ticket revenue factors into the overall basketball-related income (BRI) figure that is used to set the salary cap and luxury tax thresholds for next season. The NBA has stood by its projection of a decline in overall revenue this season between 2.5 percent and 5 percent, which would result in the salary cap declining from its current $57.7 million to between $50.4 million and $53.6 million. But a bigger than expected decline in BRI would seriously hamper certain teams’ plans to be big spenders in the 2010 free-agent market.

The article also has a statement from the NBA saying that the gate receipts are down less than the league’s projections, due to creative marketing campaigns used to boost attendance (i.e. lowering prices and hoping increase revenue from concessions, parking, etc.).

The NBA’s statement suggests that the salary cap may not fall as far as the lower end of the aforementioned range (~$50.4 million). This is important to teams looking to spend next summer. For example, the Knicks would have $23.1 million to spend under a $50.4 million cap (not enough for two max contracts), but would have $26.3 million to spend under a $53.6 million cap (almost enough for two max contracts — Brandon Roy’s extension starts at $13.5 million next season).


Photo from fOTOGLIF

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