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NBA wants to play “positive role” and help defuse US-China tensions

NBA Commissioner Adam Silver addresses the media ahead of the Milwaukee Bucks’ game against the Phoenix Suns in Game 1 of the 2021 NBA Finals on July 6, 2021 at the Phoenix Suns Arena in Phoenix, Arizona.

Garret Ellwood | National Basketball Association | Getty Images

Although tensions remain high between the United States and China, the National Basketball Association wants to unite the two countries with its product.

NBA Commissioner Adam Silver spoke to members of the media on Tuesday ahead of Game 1 of the 2021 NBA Finals, acknowledging the “bigger geopolitical issues” facing the league as two global superpowers come together. quarrel.

Disagreements between the United States and China range from trade and finance to technology. On Tuesday, government officials downplayed the importance of story of a “new cold war”. And Silver has said he wants the NBA to play a positive role in the feud.

“I think it remains important, especially when tensions are high between governments, that we foster these sporting, educational and cultural relations,” said Silver. “I’ve said this from the very beginning. It certainly doesn’t mean that we bless everything that happens in China by any means. We are basically an American company and therefore we follow the policy of the US government. . “

The NBA has an interest in finding common ground, as its operation in China is worth more than $ 5 billion. Company includes $ 1.5 billion media rights deal with China-based tech company Tencent. State-run CCTV also broadcast NBA games, but that partnership was cut short in 2019 following Twitter Philadelphia 76ers comments Senior Executive Daryl Morey.

CCTV briefly postponed games in last year’s NBA Finals with the Los Angeles Lakers, who remain popular in China thanks to Kobe Bryant. But the games have been taken off the network again this season. When asked if the games are back for the Phoenix Suns and Milwaukee Bucks NBA Finals, the league did not respond to a request for comment from CNBC.

Still, Silver expects the NBA to continue distributing its games nationwide for the foreseeable future. He said that showing that games can “play a productive role” so that American and Chinese citizens “understand each other better and see that we are all human beings and that there is something in common between us. And I think this form of engagement is critically important if we’re going to work together to try to solve some of our problems. “

A Chinese flag is placed on merchandise at the NBA flagship retail store on October 9, 2019 in Beijing, China.

Kevin Frayer | Getty Images

Silver listed Covid-19 as one of the issues. The delta variant of the virus is causing concern around the world and urged President Joe Biden to call for more eligible Americans to be vaccinated. Silver also mentioned the global climate, economic issues and human rights as other issues that the NBA can play a role in addressing.

“They have to start from a point of discussions directly with each other,” Silver said. “I think as far as through sport, again, like I said, it’s something that we can at least find common ground on. I still believe we can play it. a positive role. “

But as the NBA tries to mend its relationship with China, the league has already started to pivot to other territories. The NBA launched its Business in Africa in May, and the transaction is valued at nearly $ 1 billion. NBA Africa will oversee the growth of the newly formed Basketball Africa League, managed by the NBA.

Asked then about the similarities between NBA China and NBA Africa, Silver said, “There are structural similarities in that we have taken a geographic area and split it into a separate entity and added strategic partners because we recognize that it was the best opportunity for growth. But I think the comparison probably ends there. “

Africa is one of the fastest growing markets on the planet, with a sub-Saharan population of around 1.07 billion, according to the United Nations. The NBA opened its African headquarters in Johannesburg in 2010.

Chris Paul # 3 of the Phoenix Suns brings the ball against the Milwaukee Bucks during the second half of Game One of the NBA Finals at the Phoenix Suns Arena on July 6, 2021 in Phoenix, Arizona.

Chris Coduto | Getty Images

Income is coming back, but still down from pre-pandemic peak

In his media availability on Tuesday, Silver also said the league’s revenues have recovered from 2020, adding that the NBA “has done a little better than we originally expected.” The NBA saw its revenue streams frozen after the pandemic began last March, losing around 40% as fans were not allowed to attend games. However, the reopening has helped teams, especially the playoffs, as the playoff money is more lucrative.

NBA main media partner ESPN said league revenues had slipped to $ 8.3 billion for the 2019-20 season. That included a hit of $ 200 million due to Morey’s tweet and an additional $ 400 million in lost sponsorships and merchandise. The NBA made $ 8.8 billion for the 2018-19 season, according to Business reviews.

As for the campaign revenue shortened to 72 games this season, “we don’t have the exact numbers yet, but we might have about a third drop in revenue, something around us, at the end of the day. instead of 40%, ”Silver said.

But the NBA should benefit, as the revenue, including money from Dapper Labs’ NFT-related licenses, has helped it stay afloat. And the NBA made a sponsorship record of $ 1.46 billion turnover, according to the estimates of the IEG, a consulting firm in sports partnerships. Additionally, franchise values ​​have increased with sales from multiple teams and other investment vehicles have helped NBA owners and minority stakeholders with liquidity.

Therefore, the NBA cannot claim that it went bankrupt during the pandemic.

“If things continue on the right track and we can move on to a new season next year that looks a lot more like normal,” said Silver, “I think we will have weathered it very well.”

The Suns took a 1-0 lead over the Bucks after a 118-105 victory. Game 2 of the NBA Finals is Thursday in Phoenix. NBA hopes to see a better audience this year for the Finals, after suffering its lowest scores in Game 1 since 1994 last October.

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