The NBA still has a massive China issue, one that threatens the league’s future overseas plan. A sizable television audience and a future home of an NBA team are now very much up in the air after China promised "retribution" in the latest war of words.
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The fallout from Daryl Morey’s pro-Hong Kong, pro-democracy tweet several weeks ago continues to sizzle, with the divide seeming to deepen over time between the communist country and the NBA. The league has estimated over 300 million in the world’s most populous country play basketball, and the numbers that support the league regularly are impressive.
And with NBA Commissioner Adam Silver coming out on Friday to defend the league, noting that he was pressured by China to fire Morey (something which he has no authority to do), things don’t seem to be pointing toward an amicable conclusion any time soon. China, via Foreign Ministry spokesman Geng Shuang, went on the offensive over the weekend to go after Silver as did Chinese state-run television.
Then, a statement on government-run China Central Television over the weekend said that Silver’s defense of Morey were “fabricated lies” and defamation of China. In response, China has promised "retribution" against Silver and the league.
“Silver has spared no effort to portray himself as a fighter for free speech and used freedom of speech as an excuse to cover for Morey, who voiced his support for the violent actors in Hong Kong,” it said. “This has crossed the bottom line of the Chinese people.”
The league has talked about possible expansion in China, having tested the waters this year with preseason games in the country. That possibility might not exist as China continues to double-down on their affront over Morey’s tweet and Silver’s handling of the issue.
The market in China has a clear appetite for the sport.
Over 21 million watched last season’s NBA Finals in the country. Hundreds of millions regularly watch NBA programming. This is a market that has seen steady growth and support for the NBA. A recent $1.5 billion broadcast deal backs up this demand in China, all of which could evaporate as the war of words escalates.
In a recent press conference, Geng said that Silver’s claim that China pressured him to find Morey is something that the government “has never raised such demands.”
In addition, television deals with China could be in flux too. The league loves the Chinese market (as does NBA sponsor Nike, which does $6 billion in sales in China last year). The possible cord cutting in China could have ramifications in terms of sponsorship deals for American companies wanting to tap the emerging market as well as Chinese firms wishing to align with the global visibility of the NBA.
And while a legal battle over the possible canceling of the league’s television contract would be costly and might prove inconclusive, it still would likely hurt the league’s visibility in a country where the media is very much controlled by the affronted government. The trickle-down to fewer eyeballs on the league would impact sponsorship deal possibilities for players, such as Los Angeles Lakers star LeBron James, who makes regular trips to China to push the Nike brand.
There is likely no easy solution to this mess. China loves the NBA and the league needs the market to continue its global growth. The bottom line, driven by the dollar, is most likely to win the day and end this feud.