Why LeBron at $125 million is still a bargain
OPINION - James' impact in Cleveland has been felt on and off the court since his arrival in the NBA in 2003...
Happy NBA Free Agency!
This morning at 12:01AM, teams could officially start pitching NBA free agents.
And by free agents, I mean the free agent — LeBron James.
Yes, he has no rings to his credit.
In fact he’s never even won a game in the NBA Finals.
Sure, he’s failed to get the Cleveland Cavaliers past the Eastern Conference semifinals the last two seasons.
And yes, he routinely comes up short in clutch situations.
But despite those flaws, James is worth every dollar that he will receive this off-season.
Whether it’s the estimated $125 million James would receive if he stayed with the Cavaliers or the estimated $96 million he would get from (fill in the rumored destination of the day here), it pales in comparison to his true worth for an organization.
James’ impact in Cleveland has been felt on and off the court since his arrival in the NBA in 2003.
According to Forbes magazine, during James’ seven years in Cleveland, he increased the team’s market value by roughly $100 million. Today, the Cavaliers are worth $476 million.
If James pulls an Art Modell, packs up his things and leaves Cleveland in the middle, that organization is once again irrelevant in the NBA. Not since Michael Jordan retirement(s) has one player had such an impact on the livelihood of a franchise.
Why else do you think Michigan State’s Tom Izzo and Los Angeles Lakers assistant Brian Shaw turned down the Cavaliers head coaching job?
If LeBron stays, coaching the Cavaliers is one of the best gigs in the NBA. But if he leaves, it automatically becomes one of the worst jobs in the league.
Just the sheer thought of James on the free agent market has sent teams into a frenzy.
The New York Times reported last Sunday that an unidentified NBA executive said that James to the Chicago Bulls was a done deal. As a result, the Bulls sold more than 1,500 season tickets starting at $1,800 per ticket in a span of 48 hours. That’s in addition to the 1,500 season tickets the Bulls sold following the end of last season.
When Stephen A. Smith contradicted the New York Times report with his own story on Monday that James and Chris Bosh would join Dwayne Wade in Miami, the Heat sold more than 70 season tickets online.
And the New York Knicks, who aren’t considered frontrunners in the LeBron James race, have sold more than 3,400 season tickets since the end of the season, more than the total from all of last year. (I hope you enjoy Joe Johnson, Knicks fans.)
The NBA’s collective bargaining agreement puts a cap on how much a team can offer a free agent like James. If a player re-signs with his current team, he can receive a contract up to six-years with annual raises of 10.5 percent. If he goes to a new team, he can receive a maximum five-year deal with annual raises of 8 percent.
If this were Major League Baseball, which doesn’t have a salary cap in place, a player of James’ talent and hype could easily go for over $300 million.
Suddenly $125 million seems like a bargain, doesn’t it?
