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Volume 21 No. 1

Leagues and Governing Bodies

The NBA-owned D-League, once an eight-team operation playing solely out of the Southeast, is now a coast-to-coast business marked by sharply rising franchise values and enough demand from NBA teams to suggest further expansion could be ahead.

The D-League played its 2013-14 season with 17 teams. It will add one more franchise next fall, when a team bought by the New York Knicks begins play in Westchester County, near the Knicks’ training facility. The cost of entry: About $5 million, up from the $4 million the Philadelphia 76ers paid just one year ago for the nearby Delaware 87ers.

“Teams are starting to look at using the D-League to accomplish things from a basketball perspective,” said Knicks general manager Steve Mills. “The D-League is more relevant. It is an opportunity to test and apply things in an environment that we completely control.”

That mission, from the NBA’s perspective, has been there from the start: Use the D-League teams as training ground not only for players but also for coaches and for team executives.

What’s changed since the league’s 2001 debut is a desire for each of the NBA’s 30 teams to have its own D-League affiliate rather than NBA clubs sharing a lesser number of D-League teams. Also shaping the landscape is the increasing talk in both college and pro basketball about age limits and minor league systems for basketball, and the interest among NBA clubs in finding efficiencies in their player-development efforts.

“The New York team was an expansion, and several other teams are interested — and it does speed up the process,” said D-League President Dan Reed, talking about the push for single affiliates. “Demand is greater now, and we will respond to that demand.”

Along with the added Knicks-owned franchise, the D-League’s Springfield, Mass., team is being relocated for next season to Grand Rapids, Mich., to serve as a direct affiliate for the Detroit Pistons. That deal, announced last week, is one of the D-League’s “hybrid ownership” agreements, where a local owner runs the business side of the team while the affiliated NBA club controls all basketball

It gives the D-League 18 teams for 2014-15, with 15 of those 18 having single affiliates. The other three D-League teams (Bakersfield, Fort Wayne and Iowa) would be shared as affiliates by the 15 NBA clubs without single-affiliation deals.

NBA Commissioner Adam Silver said the D-League has come into its own in the last few years.

“Frankly, it got off to slow start,” Silver said. “We launched in some cities that weren’t optimal. We shut down some of those and have created better relationships now between the D-League teams and their NBA counterparts. It’s more of a true minor league now. The goal there would be to ultimately have one-to-one relationships where every NBA franchise would have its own D-League

Securing nearby direct affiliates with NBA teams brings cost

efficiencies in fewer travel expenses, shared staffs and greater flexibility in player call-ups — all happening under a collective-bargaining agreement that puts greater emphasis on developing talent compared with paying for it in the free agency market. The NBA’s current 19-year-old age limit, which critics contend limits player development, also adds relevance to the D-League’s evolution.

“The D-League has an enormous amount of potential, because as good as Division I men’s basketball is, people in the industry and our basketball folks will always say that D-League basketball is the next best basketball in the world after the NBA,” Silver said. “Roughly 20 percent of NBA players now have had experience in the developmental league, so I think we have just begun to scratch the surface with that opportunity.”

The D-League posted its fifth consecutive season with a gate increase this year, with total attendance of 1.1 million and an average attendance up 4.6 percent to 2,838 fans per game.

That growth comes on top of what Reed points to as other factors in being elements that will shape the future of the D-League and its teams, though he refused to talk about specifics in terms of economics and profitability.

“The rush of NBA teams in the league has created big cost savings,” Reed said, “so the profitability is increasing and that is helping drive franchise values.”

Staff writer Terry Lefton contributed to this report.

The NHL Shift appears originally each Friday on SportsBusiness Journal’s On The Ground blog

Numbers and news from the NHL: The 2013-14 season recap edition


0-for-3: There were three new ownership groups in the league this season, and all three of their teams failed to qualify for the Stanley Cup playoffs. For Phoenix (led by George Gosbee and Anthony LeBlanc), New Jersey (Josh Harris and David Blitzer) and Florida (Vincent Viola), there’s always next season.

SBJ Podcast:
As the NHL playoffs prepared to launch, hockey writer Christopher Botta and staff writer Alex Silverman discussed the latest hockey news.

Gracious gestures on the final weekend of the regular season. The Vancouver Canucks came back onto the ice to shake the hand of Edmonton winger Ryan Smyth, who had just played his last game. The Los Angeles Kings had a brief ceremony to honor Teemu Selanne, a member of the rival Ducks who is retiring after the playoffs. And, after Selanne played his last regular-season game in Anaheim, he invited opposing Colorado Avalanche goaltender J.S. Giguere (a former Duck who is expected to retire after this season) to take a lap around the ice with him and salute the fans. Hockey can be a nasty sport, but moments like these reinforce the notion that it also can be one of the classiest.

$192,000: The value of items the Ottawa Senators gave away in the stands and via social media on Fan Appreciation Night. Prizes included a Dodge truck worth $40,000, 1,500 gift cards from various club sponsors, concession stand food, and dinners at Chek Point restaurants.

21,758,902: The NHL’s total attendance this season, breaking the previous single-season high set in 2008-09. That total includes the combined 376,837 who attended the six outdoor games this season.

22,201: The largest announced crowd for a regular-season game (not played in a stadium): Colorado at Chicago on Dec. 27.

7,401: The smallest announced crowd: Nashville at Phoenix on Halloween.

7: The number of teams with ongoing sellout streaks of 100 or more regular-season and playoff games as the postseason began: Toronto (446 games), Montreal (401), Pittsburgh (327), Chicago (267), Boston (206), Los Angeles (108) and the New York Rangers (103).

Jeff Vinik, Tampa Bay Lightning owner:
The Lightning played to 97 percent capacity this season and finished third in the Eastern Conference after failing to make the playoffs last year. Vinik’s $5 million investment in a new scoreboard for the Tampa Bay Times Forum in 2012 continues to draw raves, he donates $50,000 to veterans’ causes on the day of every home game, and he personally participates in team promotions, like teaching a Hockey 101 class to new fans. You couldn’t ask for more from a small-market owner.

The Rangerstown Hockey House
New York Rangers: The Rangers have taken a 9,500-square-foot building adjacent to Madison Square Garden that formerly housed a Borders book store and converted it into a fan zone and space for MSG Network’s postseason pregame shows. The Rangerstown Hockey House features Q&A sessions with Rangers alumni, an autograph signing station and an accuracy shooting contest.

New Jersey Devils: A multiyear sponsorship with PartyPoker signed jointly in January with the NBA 76ers (also owned by Devils owners Harris and Blitzer) drew national media attention for being the first online gaming sponsorships for U.S. major league sports teams. But make no mistake: Since New Jersey is the only state with gaming regulations and a major league franchise, this was a deal with the Devils. It also, according to a source, is valued around what other teams get for arena naming-rights deals.

Liam McHugh, NBC Sports Group:
It can’t be easy wrangling studio analysts as diverse in style and temperament as Mike Milbury, Keith Jones and Jeremy Roenick, but McHugh does it with poise, intelligence and a sense of humor. He seems destined for a bigger role beyond hockey at NBC. 

Colorado Avalanche: “Why Not Us?” was the team’s marketing slogan this season, and it sure set the tone for a franchise turnaround. Team President Josh Kroenke appointed Avs legend Joe Sakic as executive vice president of hockey operations, Sakic hired goaltending great Patrick Roy as head coach, and Colorado went from the NHL’s 29th-place team last season to a division-winner this year. Average attendance increased a league-best 5.5 percent, up to 16,296 fans per game, and likely will increase further next year. The buzz is back in Denver.

Bill Daly and John Collins, NHL: A rich Canadian media-rights deal. A new single-season high for attendance. Six sold-out stadium games, including more than 104,000 fans at Michigan Stadium for the Winter Classic. A strong Olympic tournament, with increased access in Sochi for NHL Network and, along with the production of the “NHL Revealed” documentary. Commissioner Gary Bettman is ultimately in charge, but it was also a very good year for Daly, the deputy commissioner, and Collins, the league’s chief operating officer.