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NBA's Bubble Season Prevented $1.5 Billion Loss in Domestic and Chinese Money

NBA’s Bubble Season Prevented $1.5 Billion Loss in Domestic and Chinese Money

According to a report, the second half of the NBA’s 2020 season in the Disney Resort “bubble,” saved the league from a $1.5 billion loss.

According to preliminary numbers reported by Sports Business Journal, the league stood to lose the $1.5 billion if it remained shuttered through the rest of 2020. The decision to sequester teams in the “bubble” at the Disney Report in Orlando saved the league from the worst of the revenue loss.

The NBA will still lose a great deal of money thanks to the coronavirus, granted, but the decision to go ahead and play the second half of the 2020 season saved it from total calamity.

One of the biggest returns the NBA saw was from advertisers who would have pulled their cash if the second half of the season did not come off. SBD notes that all the signage, both real and virtual, satisfied enough advertisers to stick with the league for the bubble games.

Then there was the return of the Chinese. One of the NBA’s most prominent investment partners, the red Chinese government allowed the NBA to return to state-run broadcasting services for game five of the finals. Thereby renewing the relationship with the league after a year-long boycott over comments by Houston Rockets GM Daryl Morey. It will be remembered that Morey tweeted his support for human rights in the Chinese territory of Hong Kong in October of 2019, prompting the Chinese government to punish the NBA by cutting off their multimillion-dollar relationship.

Morey recently announced his retirement from the NBA after which the Chinese crowed that anyone who “hurts China’s feelings” will “pay a price.”

Still, even with the advertisers continuing their support and China returning to the fold, the league will lose millions. In the past, at least 40 percent of its earnings have come from ticket sales. But that is gone for the second half of the 2020 season thanks to the fan-less games.

Lastly, with TV ratings so dismal — the finals earned the worst TV ratings in recent history — there is no telling how that might affect advertisers next season. So, the disastrous financial impact of the virus might continue into 2021.

Furthermore, SBD notes that nearly every pro sport lost upwards of 45 percent of revenue because of the shutdowns and policies imposed by the coronavirus. The NBA will be no better off on this metric.

The full extent of the revenue loss will not be clear until an audit of all 30 teams is complete. The loss will be massive, regardless. Clearly, it will not be as bad as it could have been if the league did not play the second half of the 2020 season.

Follow Warner Todd Huston on Facebook at: facebook.com/Warner.Todd.Huston.

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