4 Quarters with David Stern
When David Stern replaced Larry O’Brien as NBA commissioner on Feb. 1, 1984, the wheels of change were already in motion. Stern had joined the NBA as general counsel in 1978 and was executive vice president before taking over as commissioner.
NBA writer John Lombardo and Executive Editor Abraham Madkour discuss David Stern's impact
on the NBA and what his future might hold.
Stern in 1983 had played a key role in negotiating the league’s first salary cap, which was instituted in 1984 and initially set at $3.6 million for each team. At the same time, the NBA instituted a drug-testing program designed to improve the player image issue, and the league rallied its marketing forces behind star players such as Magic Johnson, Larry Bird and Michael Jordan.
The results began to take hold, highlighted by a pair of television deals signed in 1984 and 1985. The league and the
|The Olympic Dream Team
Then in 1989, with Jordan, Bird and Magic driving fan interest, Stern negotiated a new four-year, $275 million deal with Turner and a four-year, $600 million deal with NBC.
The initial period of Stern’s tenure also brought new markets and expansion as Stern pushed for growth.
The Clippers moved from San Diego to Los Angeles and the Kings moved from Kansas City to Sacramento. The NBA added the Charlotte Hornets, Miami Heat, Minnesota Timberwolves and Orlando Magic.
Amid all the growth came one of Stern’s defining moments. In 1991 he and Magic Johnson sat side by side in a stunning news conference announcing that the Lakers superstar had contracted HIV and would be forced to retire.
Stern began laying the groundwork for his global vision for the league, playing a major role in getting NBA players to participate in the Olympics. The crowning moment came in 1992 with the creation of the “Dream Team,” a collection of NBA superstars who captured the gold medal at the Barcelona Games. The players captivated international audiences and planted the league’s flag in the international marketplace.
It was a period of exponential growth for the NBA, but one that also tested Stern’s mettle in labor negotiations.
Much of that growth came on the media front. Fueled by the added fan interest over Michael Jordan’s return to the Chicago Bulls, Stern negotiated a four-year, $840 million TV deal with Turner and a four-year, $1.6 billion deal with NBC. The league launched NBA.com, a pioneering move by Stern that made the NBA the first league to
Along with the new media revenue, Stern further enriched the owners by adding teams in Toronto and Vancouver, each of which paid a $125 million expansion fee, a record at the time.
Stern fulfilled his vision and commitment to develop women’s basketball by creating the WNBA, which started as an eight-team league. It was one of Stern’s most personal moves, but the WNBA continues to struggle financially and some team executives privately wonder what the future holds for the league.
|Alonzo Mourning arrives for labor talks in 1998.
Despite the growth in this period of Stern’s tenure, there was a troubling harbinger of things to come. In 1995 the league experienced its first lockout, which lasted from July 1 to Sept. 12. Then came a damaging labor battle in 1998, which resulted in a lockout that brought the league to the brink of canceling the entire 1998-99 season. But a late deal between Stern and the players union salvaged a 50-game regular season.
“David was very tough,” said former Cleveland Cavaliers owner Gordon Gund, who was chairman of the NBA board of governors during the 1998-99 lockout. “We knew the dynamics were not right for a deal going into [the lockout]. As hard as we tried to be open, there was very little trust, but we were able to build it. David was able to push far enough but not too far. He was strong minded and stayed with it.”
San Antonio Spurs owner and NBA board of governors Chairman Peter Holt added: “David always understood that there had to be parity in the league.”
Stern found himself leading a changing NBA left without its most famous face after Michael Jordan retired following the Bulls’ 1998 championship.
The NBA put an expansion team in Charlotte to replace the Hornets and relocated the troubled Vancouver Grizzlies franchise to Memphis, an acknowledgment that the initial expansion move failed as the NBA misread the market’s acceptance of the franchise.
There was another big change for the league as it signed a new TV deal not with NBC but with ESPN/ABC, for six years and $2.4 billion. The NBA signed a $2.2 billion deal with Turner that put more games on cable and shifted the NBA All-Star Game off network television to TBS.
But soon, this era became a troubled time for Stern. First, the 2004 brawl between the Indiana Pacers and Detroit
|The infamous “Malice at the Palace” leaves the NBA with a serious public relations challenge.
Aiming to improve the league’s image, Stern instituted a dress code for players, a move that some criticized as being heavy handed. He pushed through a minimum age limit requiring players to be at least 19 years old and at least one year removed from high school in order to be eligible for the draft.
The league also rolled out its NBA Cares program with a $100 million commitment to fund outreach programs including health, family and education projects.
Still, more troubles came. A gambling scandal rocked the NBA after veteran referee Tim Donaghy admitted that he passed inside information to gamblers. It was a damaging blow to the NBA’s credibility and one of Stern’s darkest hours.
Stern navigated the league out of its troubles with an eye on international growth and on the league’s newfound charitable mission.
“From the Jordan era to now, he was able to transition the league when things weren’t strong and as family friendly as he liked,” said Tony Ponturo, former vice president of global media and sports marketing for Anheuser-Busch. “Each sport goes through a bad period that weakens the brand, but David was always good in managing that process.”
In January 2008, Stern executed his vision for an international league with the creation of the NBA China entity, which at the time was valued by Goldman Sachs at $2.3 billion. In one swift move, the NBA had a presence in China’s massive market where before it had only its games broadcast on Chinese television.
Stern scheduled regular-season games in London and Mexico and beefed up preseason international games for a total of 146 games played overseas. The long global reach helped to boost overall league revenue, which is expected to reach $5.5 billion this season.
“The single thing was the globalization of the brand and the game, and he will be remembered for that more than anything else,” said Micky Arison, owner of the Miami Heat.
That globalization and domestic growth of the game began to bring a run-up of franchise values. In 2010 the
|Team sales, including the Golden State Warriors, post some big numbers.
This final period of Stern’s tenure has not been without labor strife. A 2011 lockout, the fourth under Stern, forced a shortened 66-game season but it also brought a 10-year labor deal and a new revenue-sharing system designed to aid low-revenue teams.
As Stern prepares to step down Feb. 1, there is no doubt he leaves behind a league poised for even greater growth, with a new television deal expected to far eclipse the current eight-year, $7.5 billion deal that ends after the 2015-16 season.
“He leaves the NBA in an incredible position as he hands the torch over with enormous increases in franchise values, the impact of the game and the spreading of the brand internationally,” said Jerry Colangelo, chairman of USA Basketball and former owner of the Phoenix Suns. “His great leadership and track record will put him in a position to say that he is one of the great all-time commissioners in any sport.”