FanPost

The WNBA and How Leagues Survive

"The reports of my death are greatly exaggerated." - Mark Twain

On Rebkell and elsewhere, there is some concern about the state of the WNBA. Attendance is down, and in some places markedly so.

Some say the season is a bore, with two separate competitions, one for the playoffs and the other for the Griner Bowl. Some say the new players of the next decade won't be as great as Taurasi or Leslie or Bird and that the quality of play is not as good. Some say that the players see their participation in the W as a chore, something to endure until the real money from European ball comes in the winter. Some have even been so bold as to predict a date of demise, with one hand on the pulse of the WNBA and with the eyes firmly on the wristwatch of the other hand, marking the time to decease.

We've written a lot about the vital signs of a league, but nothing about the moment of death. How does a league actually die?

In the first case, a league will only fold if its owners decide it will fold. Which brings us to the another question - who actually owns the WNBA? Who makes that decision?

If you look up WNBA trademarks, you'll find that the owner of the trademark is the WNBA Enterprises LLC, which means "limited liability corporation". This basically means a lawsuit against the WNBA is not a lawsuit against the owners or investors. The only liability is limited to what the LLC owns, not what the members own.

Unfortunately, an LLC is a bit more murky than a corporation to untangle. The board members cannot be found on the internet, only "key" members which are pretty much the names you'd expect to see. Names like Laurel Richie, Renee Brown, etc., the people one associates with "running" the wNBA.

A clue as to who might be on the board comes from looking up WNBA trademarks online. The New York Liberty recently applied for a trademark. The "correspondent" listed is Anil V. George, who works in the legal department of the National Basketball Association, or NBA. He is with the legal department, particularly the intellectual property group.

If you look him up, he was actually the Senior Intellectual Property Counsel at NBA Properties Inc, a job he has held since January 2000. So I suspect that it was the NBA that set this board up and it is the NBA that runs it. After all, who was the person who announced the appointment of WNBA President Laurel Richie? David Stern, the NBA commissioner.

So I suspect that the NBA owns the league, because it appears to have some influence as to who runs WNBA Enterprises LLC and appears to hold the WNBA's intellectual property. But that doesn't mean that the NBA owns the teams, which is an important distinction. There are some owners who own both the NBA and WNBA franchise in the same city, like Robert Sarver who owns both the Phoenix Suns and Phoenix Mercury.

We have to digress. In 1997, every WNBA team owner was also the NBA team owner in the same city. The idea was that the WNBA franchises would gain value and the NBA team owners could either hang on to them or sell them off. Atlanta, Chicago, Connecticut, Los Angeles, Seattle and Tulsa are WNBA franchises which are not owned by the owners of the NBA franchise (where applicable) in the same city. Whereas the Indiana, Minnesota, Phoenix, New York, San Antonio, and Washington franchises are also owned by whoever owns the NBA franchise in that city.

So if the NBA wanted to shut the WNBA down - could it? It could probably deny the WNBA the right to use its own trademarks. It could also put pressure on the owners which also own NBA franchises to shutter their WNBA franchises, leaving the league (which wouldn't be the WNBA) with just six teams. It would stop providing what institutional support it provides, namely television contract negotiation or providing economy of scale with its promotional arm. It could keep the WNBA off NBA television, or use its pull with ESPN and the networks to keep a new league from getting a TV contract. It might be able to bar WNBA teams from using arenas, if the NBA owner in some team also owns the area where the WNBA team is a tenant.

But it you think about it...it really couldn't. There would be nothing that could really stop the other six teams (or more, if the NBA/WNBA owners fought back) from forming a league of their own under a new name with new trademarks and playing in new locations wherever necessary. The NBA might have trademarked the orange and oatmeal basketball, but they haven't trademarked women's basketball itself.

The truth is, the survival of a league depends on one set of people and one set of people only - the franchise owners. There is a lot of talk about owners losing money, but the fact remains that if enough owners don't mind losing $1 million-$2 million a year, the league can endure in perpetuity.

At the Every Day Should be Saturday blog, Spencer Hall makes a point about what it takes to keep a sports institution alive. One group is the Moneybags, and the other group is the Diehards. The Moneybags are the owners and big spenders who will pump cash in with ownership, suite purchases, etc. The Diehards are the group in aggregate that will spend whatever it takes to keep their sports jones alive, the passionate fan base.

If you have Moneybags and no Diehards, you basically have a hobby for rich people. If you have Diehards and no Moneybags, you have Judy Garland and Mickey Rooney putting on a show in the barn. You really need both to be taken seriously as a sport.

I believe that we have the Moneybags. Aside from a couple of exceptions, I think that WNBA ownership has the cash to last it out in the long run. The question is whether or not the owners will make it to that point.

Establishing a sports league isn't a sprint - it's a marathon, sometimes a decades-long marathon. We're not even to the WNBA's third decade yet. If owners are going to keep a league alive, there are only two things they have to worry about.

a) Selective membership. No one should ever be admitted into the group that doesn't have the money to run the race. The WNBA learned this lesson in a painful way when Les Alexander - the owner of the NBA rockets - sold Hilton Koch the Houston Comets franchise, and he just didn't have the cash to run it. As a result, the league was forced to close the franchise that gave the WNBA its first four championships.

The above proves that sometimes, you can't control who ends up with a franchise. (The reality of the time was probably that the WNBA couldn't do much to stop the sale.) But when new franchises are formed, or franchises are relocated, it's much better to kill the deal now than it is to grant a new franchise or relocation and have the deal killed later with great embarrassment.

b) Psychological factors. So how do psychological factors play in? After all, owners are tough businessmen. Rich people usually don't become rich by being weak. Many sports owners have sports backgrounds themselves, and are supposed to be mentally tough.

Karra Porter writes about what owners in new leagues have to go through in her book Mad Seasons: The Story of the First Women's Professional Basketball League, a story about the Women's Basketball League of 1978-81. The first point is that owners have usually come from a background where they have been very successful at making money. They get into ownership, and fail to realize that it's not a sprint, it's a marathon and profit - if there is any - might come decades down the line.

Yes, pro football, the NBA, and baseball are money makers - but it took decades of hard work and sweat to get to the point where a franchise could be valued in the billions. She sites an imaginary example of an owner who is informed by, say, a paper supplier that unless a bill is paid that no more paper/ink/whatever shall be forthcoming.

It's not that the owner doesn't have the money for it - in fact, the owner could probably buy the printing company if he or she wanted to. But this is the first time in decades that an employer has actually had his credit questioned by someone. It can shake up the unwary.

Indeed, owning a struggling franchise is more a psychological wear-and-tear than anything else. The difficulties of dealing with a disinterested national news media. The chiding you get from your friends and colleagues. ("So, Ron, do you think you'll be making any money this year?") The look in the eyes of other successful businessmen who look at you (as an owner) and think, "Boy, what a sucker that guy is! Buying a WNBA franchise!"

It's not a sprint, it's a marathon - a marathon over some very wet and rocky road, with few friends around for miles in sight and dogs nipping at your feet every step of the way and the only spectators on the road are either ragged, impoverished supporters or naysayers cheering your every misstep and failure. It can test the mental reserves of an owner who has gotten too used to success in every other thing he or she does. Eventually, it all comes together and the owner panics. If it gets too gloomy then "What the hell was I thinking?" is the thought that comes unbidden, and before you know it the franchise is up for sale.

To be a successful sports owner, you don't just need money (and lots of it). You need a entire truckload of don't-give-a-damn. (And you'll use it quicker that you ever imagined.) A league can always screen for the guys who have the money but finding the owners with iron will is almost impossible to predict - nothing tests an owner mentally like owning a WNBA franchise. It's the same iron will a struggling actor needs when his family is calling him to come back home and get a real job.

So when will the WNBA fold, if ever? It will fold when the owners decide it will fold. And it will not fold before then. It has nothing to do with the quality of the 2012 season, it has nothing to do with attendance, it has nothing to do with fan support, it has nothing to do with the presence or absence of a TV contract. It really doesn't have anything to do with how many teams exist or are relocated. If the owners want a league, and want to pay for a league, then there will be a league.

Let's go back to the Women's Basketball League. In 1981, you had broke owners, incommunicado owners, people threatening to sue, etc. etc. So did the league just fade away like the Roman Empire with no one knowing the day it died? No. One of the existing owners made a motion that the league be dissolved, it was signed by a majority of the remaining active owners, and that was the end of the league.

If the WNBA ends, that's how it will end. So don't worry. You still have women's basketball until then.

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