The storyline that dominated NBA headlines during the preseason has fallen off the radar to some extent with the regular season underway, but that doesn’t mean league and team executives aren’t still concerned about the NBA’s relationship with China.
League sources tell Kevin Arnovitz of ESPN.com that NBA leadership is monitoring the trade negotiations between the United States and China in the hopes that a resolution on that front will help thaw the league’s relationships in its “most profitable foreign market.” Those relationships have been frosty since Rockets general manager Daryl Morey published a tweet supporting pro-democracy protestors in Hong Kong.
Tencent – the NBA’s streaming partner in China – has resumed broadcasting games, but still isn’t showing Rockets contests, as Arnovitz details. Meanwhile, China’s state-run network CCTV hasn’t shown any regular season games at all. While the NBA has remained in contact with CCTV officials, there’s no sense of when the impasse may be resolved.
Arnovitz’s full story at ESPN.com provides an exhaustive, in-depth look at where things stand between the NBA and China, and is worth reading in full. Here are a few more highlights from the report:
- Terminated sponsorships with Chinese companies have affected teams around the NBA, not just the league itself, according to Arnovitz, who hears that one club immediately reduced its 2019/20 projections for revenue derived from Chinese sponsorships to zero. The Rockets have been hit particularly hard, having lost $7MM+ in cancelled sponsorship agreements for this season, and $20MM overall once multiyear deals are taken into account.
- Beyond the financial ramifications, some NBA front offices have been “shaken by the turmoil” caused by the drama with China, league sources tell ESPN. As Arnovitz explains, the league has enjoyed increasing revenues and positive media coverage for years, but the China controversy has tested the idea that any issue can be managed.
- Many team executives would like the league to establish guidelines for dealing with potentially sensitive political topics, since teams and players will likely have to answer those questions in the future — especially on trips to China and India, among other countries. League sources have acknowledged the need for those guidelines, Arnovitz says.
- Rival executives don’t expect this controversy will impact Morey’s ability to do his job. However, sources close to the Rockets view the marriage of Morey and team owner Tilman Fertitta as a “tenuous fit,” according to Arnovitz. Fertitta has been more averse to paying the tax than his predecessor Leslie Alexander was, and quickly denounced Morey’s tweet last month, announcing that the GM’s views didn’t reflect that of the organization.