INSIDER: Winners, Losers of Donald Sterling Saga

Clippers TopBuzz Forum/Message Board » Clippers News & General Discussions
Post new topic   Reply to topic
Author Search This Topic:
Posts: 4675
Location: The Darkside
votes: 37

I don't know if this has been posted yet:

A lot has transpired in the month since Donald Sterling's audio recordings were made public, but with a likely new owner in place, things seem to be drawing to a close. Steve Ballmer's $2 billion bid to buy the team still has to be approved by the NBA's Board of Governors, and Donald Sterling has sued the league (although most legal experts agree his complaint has very little merit), and there might be issues to work out regarding Donald's competency and Shelly Sterling's ability to act on behalf of the Sterling trust. But at least we have a sense of how things are likely to play out.

Let's take a look at the winners and losers in this whole sordid mess.


NBA owners: The old adage is that something is worth what someone else is willing to pay for it. And one fact is unequivocal -- someone just ponied up $2 billion for an NBA team. Just as a rising tide lifts all boats, this should increase the value of every other team. Maybe this is just an outlier. After all, an extremely rare asset -- a professional sports franchise in a major market -- became available under highly publicized circumstances with an artificially short window of time.

If anything, maybe this sale merely creates a price bubble that will soon burst. But at least for now, few if any owners would be willing to entertain offers that might have been tempting as recently as a month ago. Recent purchasers have to be breathing a sigh of relief, and longtime owners must now be giving serious consideration to another adage -- buy low, sell high. For example, if the "kid brother" franchise is worth $2 billion, what are the Lakers worth?

Clippers players: Replace Sterling with Ballmer? Win. The Clippers players no longer have an ethical dilemma about continuing to make money for a man they despise. Plus, as Amin Elhassan describes, Ballmer likely will take steps to make the Clippers a better team. We could see them spend into the luxury tax without hesitation, improve scouting, and make great strides in analytics and quantitative analysis. As soon as next season, the Clippers could be even better than this season's 57-win team.

NBA players in general: The players could have been in a real bind if this situation wasn't resolved before next season. They could not have hastened Sterling's departure, and some of their options would have left them in a bad situation. But just the hint of a strike, or any of the devastating consequences that could have befallen the league if the players' strong feelings were not heard, played a part in ensuring Sterling received the harshest possible penalty. Guys like LeBron James stepped up and took a position, and the public took notice. It's not just the display of unity -- it's the fact that they made a difference. This newfound strength could serve them well in the next labor negotiation.

Magic Johnson

AP Photo/Mark J. Terrill

Johnson bore the brunt of Sterling's comments but took the high road with Silver.

Adam Silver: Silver had big shoes to fill, and everyone wanted to know how the new commissioner would handle his first major incident. A scant three months into the job, we all found out. Very well, it turns out; he was firm and decisive, winning universal praise. Magic Johnson tweeted on April 29: "Current and former NBA players now know that in Commissioner Adam Silver we have a great leader leading our league."

Magic Johnson: One of the targets of Sterling's racist remarks, Magic responded with dignity and poise, and he was soon mentioned as a logical candidate to buy the Clippers. However, the Lakers legend and former part-owner made it clear that he would rather own a piece of the Lakers again -- and Ballmer's purchase might give him the chance. It's possible the Buss family will wonder whether it's time to cash in on this seller's market. If the Buss family determines that now is the time to sell, Johnson and his Guggenheim Group partners will surely be in the running, if not at the front of the line.

Clippers fans: Sure, the Clips have made great strides in recent years, including the strong showing this season behind Chris Paul and Blake Griffin. After consistently dwelling in the Lakers' shadow, for once they're up while the Lakers are decidedly down. Yet lurking in the back of Clippers fans' minds was the dread that Sterling would mess things up somehow. Only this time it was so egregious that it washed Sterling away and left the team relatively unscathed. So the Clippers have a deep-pocketed owner who just paid $2 billion and will want results -- you do the math. Also, a reported condition of the sale is that the team will remain in Los Angeles -- and Ballmer confirmed that moving the franchise would be value-destructive. Long-suffering Clippers fans are going to be much happier.

The NBA Board of Governors: For a number of reasons -- Mark Cuban's slippery slope, Sterling being recorded in a private conversation, and potential issues with his competency -- most owners seem as though they would rather not decide on Sterling's fate with the league. With the sale to Ballmer and the cancellation of the June 3 vote, it appears likely they won't have to. In the end, it was Sterling who blinked, not the league.


Donald Sterling: Sure, when this is over, he will have converted a $12.5 million investment into a $2 billion sale despite his consistently inept ownership -- a 15,900 percent return on his investment, not counting operating income or capital gains taxes. But the big winner for financial reasons is also the biggest loser for every other reason in the book. The most hated man in America will be deprived of his team, was banned for life from any further involvement with the league, and has potentially devastating health issues to deal with. And don't think for a moment that the league is going to let him skip out on paying that $2.5 million fine, either.

Donald Sterling

Jayne Kamin-Oncea/USA TODAY Sports

Time's up on Sterling's tenure as Los Angeles Clippers owner.

Potential NBA owners: For anyone contemplating purchasing a team, the price of an NBA franchise just got a lot higher, and the group of people who can afford a team just got a lot more exclusive.

Shelly Sterling: Innocent victim, or Donald's co-conspirator and enabler for the last 50-plus years? Whichever way you view her, the objective facts are that her family's dirty laundry was thrust into the spotlight, and her team -- which she genuinely enjoyed -- was ripped from her hands.

According to reports, Ballmer has confirmed that Shelly Sterling will have a sort of "owner-emeritus" status with the team, but not an ownership role. So she will be reduced to some sort of ceremonial role with the team she once owned.

In addition, she has agreed to indemnify the league for lawsuits by her husband -- but she doesn't control him. She could wind up covering millions of dollars in legal fees even if the league wins the Donald Sterling lawsuit, and potentially many times more than that in damages if the league loses.

Steve Ballmer: This one's iffy. There are intangible benefits to owning an NBA team, to be sure. Plus, there will be new national media deals coming up, and it's reasonable to expect the Clippers will be able to negotiate a regional cable TV deal in a couple of years, similar to the one the Lakers signed with Time Warner Cable. Still, he's paying $2 billion for a sports franchise, and in order to discourage a bidding war, offered $400 million more than the next highest bid.

Adjusting for inflation, there will be almost no way to turn the team over for a profit. If the inflated values are just a temporary spike (especially if this deal is an isolated occurrence), then Ballmer will be like the guy who buys a sports car, and the value drops as soon as he drives it off the lot. Of course, few people buy sports cars because they think they're good investments.

The Lakers and Lakers fans: The Lakers always have had the upper hand over the Clippers, and given the trophy count, this won't change right away. But with Sterling gone, the Lakers' dominance will start to erode. Hard-core Lakers fans won't care, but the bandwagon fans have another reason to hop off. It could be said that healthy competition is good for everyone. The Yankees-Red Sox rivalry increases interest among the fans and revenues for both teams. This could benefit the Lakers in the long run.

However, for the first time ever, the Lakers have a local rival with a strong nucleus, a motivated owner and a sense of optimism. There is new hope in Clipperland. The Lakers have to get used to sharing the limelight.

Houston attorney David C. Holmes contributed to this report.

Posts: 7964

votes: 35

Lol lakers fans are losers. That's not news they've been losers for a while

Posts: 2679

votes: 31

After Donald himself, there's no bigger loser than Laker fans. The sense of entitlement will be completely gone in the next year or two and when they have to rebuild only AFTER Kobe finally leaves, they're looking at an extended period of chasing mediocrity.

This is all pretty amazing. Blake falls in our laps 4 years ago, Neil pulls off CP3 trade for a bag of rocks...Firing Vinny only get Doc Rivers out of nowhere. Now the dream scenario of Donald finally doing something so bad that he gets kicked out of the league. And now we have the richest owner in sports, a guy who will never worry about the money.

Meanwhile the Lakers are run by the runt of the litter, are paying 35mil to a cripple and a 90year old pg. And have dumped almost all their draft picks.

Future looks bright. Very bright.

Posts: 4675
Location: The Darkside
votes: 37

Are you not am I..that we may wake up and find out this hasn't happened at all and it is still 2008 and our new big signing is Ryan Gomes?

Go To the Top of the ThreadGo Home

or Comment Using FB

Post new topic   Reply to topic

← Chris Paul Receives Gift from Kelly Kapowski on Birthday

→ What Can the Clippers Do with No Upper Limit on Budget?

You cannot post new topics in this forum
You cannot reply to topics in this forum
You cannot edit your posts in this forum
You cannot delete your posts in this forum
You cannot vote in polls in this forum

You are an anonymous user- Register now!

Follow our Los Angeles Clippers RSS Feed, plus the Clippers Rumors RSS Feed, the LA Clippers News RSS feed, and the Clippers Forum RSS feed to get the newest updated Clippers News and Trade Rumors plus Clippers Game update in your RSS/XML reader!