The Donald Sterling saga is seemingly near a close, with confirmed reports of a winning bid from Steve Ballmer worth $2.0 billion to purchase the Los Angeles Clippers. It marks the end of a 33-year tenure that has seen more downs than ups; years of inept stewardship, mercurial behavior and a brand that stood for the laughingstock of professional sports. What does new ownership mean for the Clippers?
The purchase price
At $2 billion, the Clippers became the largest sale in professional sports history -- the Clippers! Ballmer ended up paying more than triple what he tried to pay to purchase the Sacramento Kings last year. Several factors play into the inflation of value (not the least of which is the desirability of the Greater Los Angeles area as a market), but none is greater than the simple concept of scarcity. A third of the teams in the league have been sold within the past five years, and half within the past 10 years. With each additional sale, there's one fewer owner willing to sell (after all, the owners bought the teams to fulfill their passion as sports fans, not to flip for a profit immediately), and the remaining unsold franchises rise in value.
Additionally, the impending negotiations for the new national TV deal mean a bigger windfall in terms of yearly revenues. Not much further beyond that is the specter of another lockout, which no doubt will be hastened along by the exorbitant sales that have taken place during this collective bargaining agreement.
How this makes the Clippers better on the court
In the short term, Ballmer's ownership does little to change the on-court product for the Clippers. As inept an owner as Sterling was, he green-lit spending for payroll to grow over the past few years, and they had a top-five payroll and were over the tax threshold in 2013-14. With the cap and tax both expected to rise significantly for next season, the Clippers projected payroll for 2014-15 will be under the tax threshold, meaning they'll have access to mechanisms such as the non-taxpayer midlevel exception, and the ability to acquire players via sign-and-trade. I wrote about some possible ways they could upgrade their roster, such as signing-and-trading for Luol Deng. Again, this isn't different from what they would have been able to do if Sterling were still in power, but we can safely assume that any haggling over how much to pay a player would have been greatly reduced.
The big way Ballmer changes Clippers basketball ops is with his investment in behind-the-scenes aspects. The NBA scouting operation has become a cutting edge arms race, and, although Sterling OK'd paying more for players, other aspects still languished in terms of financial support. Expect more funding for staffing of the front office -- more scouting, more interns, perhaps more of an emphasis on quantitative analysis. Furthermore, expect more capital investment in technology. After all, Ballmer is the former CEO of Microsoft, with access to some of the brightest programming minds in the world. When it comes to everything from building of databases to analysis of raw SportVu data, expect the Clippers to be industry leaders fairly soon.
What this means for the Clippers' leaders
Steve Ballmer, left, will bring along with him a sense of stability for the entire franchise.
The most obvious benefit is not working for a bigot, but beyond that, Ballmer's ownership gives a sense of stability to the entire operation. Despite having a strong roster and coaching staff, there was always a feeling of, "It's the Clippers; they'll find a way to mess that up," and that feeling stems from the instability in the owner's box. Look at the most consistently successful franchises in the NBA (San Antonio and Miami, among others), and the common thread they share is reliable ownership. Reliable not only in the sense of willingness to pony up the cash when needed but also in even-tempered stewardship and allowing the experts put in place to do their jobs without excessive meddling.
Doc Rivers doesn't know whether Ballmer is a Micky Arison or Peter Holt, but those owners know he's no Donald Sterling, and that's already a huge step in the right direction. Similarly, Chris Paul and Blake Griffin don't have to live with sinking fear that this will all come crumbling down at any moment because the owner is mercurial. There's a newfound sense of security.
What this means for the Los Angeles Lakers
Perhaps the most fascinating aspect of this sale has been the question, "If the Clippers are worth $2 billion, how much are the Lakers worth?" Today, they're probably worth more; the legacy of the franchise, the brand equity, the 16 championship banners that hang behind Clippers signage in Staples Center, and the Hall of Famers who have donned the purple and gold at one point or another still separate the Lakers from the Clippers. But make no mistake -- if the Clippers are going to take meaningful bites out of the Lakers' stranglehold on the L.A. market, the arrival of Ballmer signifies the acceleration of that process. Since the transfer of day-to-day control from Dr. Jerry Buss to his children, the Lakers have experienced a downward spiral. Their massive commitment to aging (and injured) Kobe Bryant, in spite of rational decision-making, only hastens that decline.
In a strange way, the Clippers' stewardship the past few years resembles that of the Lakers -- a willingness to pay for the names on the marquee (players, head coaches), but not necessarily to invest in the infrastructure. Remember, the Lakers are the team that famously laid off employees during the lockout, including scouts, video coordinators, coaches and their assistant general manager, Ronnie Lester. That approach to investment in infrastructure will separate the two franchises from here on out.
The Clippers will never match the franchise accolades the Lakers boast, but, in a society in which bias is the law of the land and a short attention span is the norm, they might not need to. Each passing year when the Clippers are clearly better-run and feature a better on-court product will result in new fans every day. Sterling bought the Clippers 33 years ago, moved them to Los Angeles 30 years ago, then proceeded to mismanage them horrendously most of that time. The arrival of Ballmer not only lights a fire under the Clippers. It lights a fire under the Lakers, who will have real, sustainable competition in their market for the first time.