Last summer, James Harden signed a four-year, $118 million extension with the Houston Rockets, a deal that didn’t sit right with people who felt he simply wasn’t worth that amount of cash.
This weekend, the Rockets announced that they were re-upping with Harden, giving him a four-year, $170 million contract extension on top of that that will run through the 2022-23 season. He became eligible for the new deal by virtue of the designated player veteran extension after being named to this year’s All-NBA team.
So when all of the numbers are tabulated, Harden will rake in around $228 million by the time he’s up for his next deal.
“Since he arrived in Houston, James has exhibited the incredible work ethic, desire to win, and passion to be the best that has made him one of the most unique and talented superstars in the history of the game,” Rockets owner Leslie Alexander said in the team’s statement. “Additionally, the commitment he has shown to our organization, the City of Houston, and Rockets fans all over the world makes him a perfect leader in our pursuit of another championship.”
James Harden finished second in the league in scoring (29.1 points per game) and first in assists (11.2 per game). Enjoy his best work from the regular season!
Speaking of pursuing another championship, another contract that made some blood boil was Stephen Curry’s five-year, $201 million free agent deal that he signed to remain with the Golden State Warriors.
Folks also took umbrage to the incredible dollar amounts being tossed around to free agents like Blake Griffin, Gordon Hayward and Kyle Lowry, who signed deals worth $173 million, $128 million and $100 million respectively. But their elevated status as marquee players muted the response somewhat.
But when point guard Jrue Holiday, who has averaged 14.3 points, 6.2 assists and 3.6 rebounds over his eight-year career, signed for $153 million to remain in New Orleans for the next five years, some people lost their damn minds.
Fringe players that the average fan has never heard of like Cristiano Feliciano, who was re-signed by the Bulls for $32 million over four years, and Joe Ingles, who was given a $52 million, four-year deal to remain in Utah, also got paid handsomely, causing many to have a conniption.
When some Knicks fans learned that Tim Hardaway, Jr. was given $71 million over four years to leave Atlanta and come back to New York, some of them wondered if that outstripped all of the craziness from Phil Jackson’s reign as GM.
In my next life, I will run a Twitter account that explains the salary cap to ignorant NBA fans.
Here’s a quick Cliffnotes version of what is going on here. A new collective bargaining agreement went into effect on July 1st. If you’d like to better understand the new CBA, you can review the finer points here.
Folks are out here acting as if today’s new salary structure is an affront to their sensibilities, yet they have no concept of how the economics of the NBA works. The 2016-2017 season was the first under the NBA’s massive new $24 billion television deal. This record-breaking contract with Turner and ESPN/ABC has flooded the league with revenue that only promises to rise in the future.
Heading into this offseason, the salary cap to rose to its highest level yet, $99 million. Last year, with a jump from $70 million to $94 million, the $24 million increase was the biggest year-to-year leap the league has ever seen.
So to keep things simple, the pie is growing and the players are entitled to their fair share. Under the new agreement, the players, you know, the guys like Kevin Durant, Steph Curry and LeBron James that pack arenas and keep the turnstiles humming, maintain a 51% majority share of basketball-related income, which is constantly expanding with more revenue streams that benefit not only the ballers, but the true big ballers who sit in the owner’s suite even moreso.
The value of NBA franchises has risen more than 240% since the 2011 lockout and the players raked in $1.5 billion more in the first year of this deal than in 2011. Now before you become fixated on the $1.5 billion figure, step back for a moment and take a deep breath.
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Yes, salaries are increasing dramatically. A 45% increase in minimum salaries across the board went into effect this year. While most folks were screaming at KD for going to get his ring with the Warriors, both the players and owners were celebrating like Whiz and Ice at the Homeboys No Money Down Seminar, with both sides examining the explosion in money while contemplating, “Now how can I make that knowledge work for me?”
The average NBA salary is expected to be in the neighborhood of $8.5 million this upcoming season, and it’s projected to hit $10 million by 202021.
Mo’ money! Mo’ Money! Mo’ Money!!!
So expect to see more guys like Taj Gibson, George Hill, James Johnson, Patty Mills, Andre Roberson and Dion Waiters getting contracts in dollar amounts that would have been warranted by supreme superstars only a few years ago.
Free agency terms, the one’s that were fought for and earned at the collective bargaining table, are now more favorable than ever for the players, with fewer restrictions on high draft selections, among fewer moratoriums and other rule changes involving qualifying offers and luxury tax rules.
If you’re mad at what today’s players are earning, chances are that you don’t fully grasp basic economics, more specifically that one’s value to the economy is based on factors that exist under the umbrella of a free-market system. And even within that, though some of you will vomit at the next statement, guys like LeBron, Steph, KD and Harden are still grossly underpaid.
So tell me again why there’s a cap on how much a player should get?? Don’t answer that. Steph should be getting 400M this summer 5yrs. #JMTs https://t.co/jMYfI0umWK
Curry is a two-time MVP who has won two NBA championships over the past three years. But his contributions to Golden State’s resurgence stretch much farther than wins, titles and MVP’s.
The monetary valuation of the Warriors has risen a remarkable 450% in the last seven years, from $450 million in 2010 to $2.6 billion this year.
How big of a role has Steph Curry, who also has $14-plus billion market-cap value for the footwear and apparel giant Under Armour, played in Warriors owner Joe Lacob realizing such a remarkable rate of appreciation for not only the franchise, but also in terms of his own personal net worth?
And it’s not just the Dubs. Franchises across the board have seen their values appreciate remarkably. The average team is now worth $1.36 billion, a 3.5-fold increase over the last five years that has been nourished by the aforementioned television deal, new CBA and incredible international growth opportunities.
The Knicks and the Lakers, the NBA’s most valuable franchises, have lost close to 70% of their games over the last four years and they’re valued at $3.3 billion and $3 billion respectively. Yet no one is out here tripping on what Knicks owner James Dolan, in his utter incompetence, makes.
But they’re steady counting Harden and Curry’s loot as if something is askew.
The Warriors broke ground in January on their new privately financed $1 billion arena in San Francisco, which will be open for business at the tip-off of the 2019-20 season. They have a 20-year naming rights agreement with Chase worth an estimated $300 million. That’s the most ever, by the way, for an arena in the United States. And when that sparkling new cash cow opens and the loot starts pouring in, the Warriors will be neck-and-neck with the Knicks and Lakers for the NBAs highest revenues.
Stephen Curry was electric throughout the entire series, helping to lead the Golden State Warriors to a 4-1 series win with averages of 26.8 points, 8.0 rebounds and 9.4 assists — including a 34-point, 10-assist night in the clincher.
The Kings opened their new arena, Golden 1 Center, this season and the Bucks are set to open their new digs in 2018. And there’s plenty more to follow.
And the growth potential in overseas markets, on a plethora of revenue generating fronts, is beyond staggering. With 1.2 billion unique viewers worldwide over the course of the 2015-2016 season, no sport other than soccer has the most growth potential.
Mo’ Money! Mo’ Money! Mo’ Money!!!
So whether your team stinks or not, your owner is making more money than you could possibly imagine. But ya’ll wanna get angry at the players for getting paid, right? And if you listen to LeBron and look at the math, they ain’t even getting what they’re really, really worth.
LeBron James led the Cleveland Cavaliers to their first ever NBA Championship in a historic upset over the Golden State Warriors. King James nearly averaged a triple double in the series with a finals average of 29.7 points 11.3 rebounds, and 8.9 assists. Watch highlights from all seven games of LeBron James masterful Finals performance.
Don’t hate the players, hate the economics the next time you find out that a role player inks a deal worth $50 million over four years, as Kelly Olynyck just did with Miami.
And make sure you ponder the size of the checks that Dolan and his cohorts will be cashing over the next several years, especially when you throw a hissy fit at LeBron’s next free agency contract.