Post by Jon Pastuszek
June 30, 2011
On Monday, the Sports Business Journal published a summary authored by Wasserman Media Group proposing the idea of a “China Basketball Tour” as an option for its players in the event of a lockout. Wasserman, which represents 45 NBA players, including NBA MVP Derrick Rose, began pitching the idea in April with a plan of bringing over around 15-20 athletes for a four-team, three city tour that would last in between two and three weeks.
Obviously, with an estimated 300-400 million basketball fans, starting up an exhibition tour with NBA players in a market that is larger than the entire population of the United States is an eye-opening proposition. Imagining a scenario where hundreds of millions of NBA-crazy Chinese could tune into live games in primetime is enough to make even the most tight lipped players, agents, media and company executives slobber all over themselves uncontrollably.
But, as is the case with doing basketball business in China, there’s more to it than just having a great idea, signing a contract and packing up your bags for a 13 hour flight.
A lot more, actually.
Matt Beyer, an Associate Director at North Head, a public affairs consultancy based in Beijing which represents several NBA athletes in China, has been working on a similar idea since the beginning of March when the potential of a NBA work stoppage turned more serious. When discussing what he calls a “China Contingency League,” Beyer, who worked as Yi Jianlian’s personal interpreter during his rookie season with the Milwaukee Bucks in 2007-08, sees the obvious potential in bringing over a group of NBA players to play in China.
“China is a massive market for NBA basketball, so it makes sense for players and agents to look here to capitalize on a lockout situation,” says Beyer.
But Beyer, like any other foreigner with sports business experience in China, knows that simply having an idea, no matter how good of a one it is, is meaningless unless you understand the systematic differences between the U.S. and China. And in China, those differences always start with government, which controls almost all aspects of the Chinese sports system.
“As China’s sports industry is controlled strictly by the government, there are many political and regulatory differences from the United States to be aware of,” explains Beyer. “While a great idea may sell on its merits in the United States, that may not be the case in China.”
Most of the time, it’s not the case in China. Whereas professional teams and athletes in the U.S. are allowed to operate freely and independently under capitalistic market principles, the Chinese government values sports as a key political interest, and thus keeps the entire system under tight control. Overseen by the General Sports Administration, China’s government body that is responsible for regulating sports nationally, the sports system is designed to produce gold medal caliber teams and athletes, which serve as a way for China to gain international glory while simultaneously boosting nationalism within its borders. The cause-and-effect relationship between winning gold medals and promoting national pride is a vital interest for China’s government, which traditionally puts a strong emphasis on nationalism in order to maintain stability.
To ensure that this key political interest stays in line with party policy, teams and athletes are trained directly under the close watch of the General Sports Administration. Selected and brought into government run athletic training academies from ages sometimes as young as eight years old, Chinese athletes are generally required to put winning recognition for their country in international competitions ahead of winning large endorsement deals for their bank accounts. Though the government has taken measures to open up sports to the market — think current French Open champion, Li Na — system itself is still largely run as an instrument of the government and their national interests.
Naturally, as arguably the most popular sport in China, basketball exists as one of the government’s biggest interests, not only politically but also commercially. With potentially the biggest market in the world, China remains cautious at the idea of simply opening up the floodgates to foreign businesses who are solely concerned with their own profits. Thus, any ideas involving a “China Basketball Tour” or a “China Contingency League” must be viewed by the government as beneficial towards the development of Chinese basketball.
“China’s sports system remains controlled tightly by the government,” says Beyer. “The government is focused on breeding its own domestic talents and not simply importing and selling foreign sports entertainment as its political agenda.”
Thus, if the Chinese government doesn’t feel that an NBA exhibition tour will benefit the development of Chinese basketball — i.e. that it won’t bring China closer to their goal of an Olympic gold medal — then there simply won’t be an NBA exhibition tour – even if it features NBA MVP Derrick Rose.
“The General Sports Administration, the China Basketball Management Center under the General Sports Administration and the Chinese Basketball Association must all be in consensus that an idea like this is good for Chinese basketball. Any agents proposing an idea like this in China should present it to China’s sports authorities from a perspective of a means to enrich local talent and the strength of the Chinese sports industry.”
Beyer argues that any basketball tour of China must therefore feature an element that promotes and cultivates Chinese basketball, like joint training sessions with local CBA teams or coaches clinics run by American NBA coaches. Having Chinese players play side by side with NBA players in exhibition games may even be more exciting to regulators and attractive to CBA teams looking to sponsor such a venture.
“There must be a community outreach function to the trip or it will be seen as threatening to the Chinese domestic sports industry. If it looks like foreign masterminded profiteering or an opportunistic venture, the government won’t sign off on that.”
“If the idea of an exhibition tour can be presented with Chinese interests in mind and through the mouths of prominent and credible Chinese spokespeople, it would be more likely to succeed.”
In addition to winning the approval of the Chinese government, there are many other obstacles that would potentially prevent a China exhibition tour from happening, including securing player insurance and television rights. Unlike in the United States, television companies do not pay large amounts of money — if any — to secure television slots, which makes finding large sponsors who are willing to invest a lot of money to ensure games are television nationally a paramount priority.
“Players and agents must be willing to be flexible and ready to move quickly in unison to make such a ‘contingency league’ a viable reality,” says Beyer. “Strong, on-the-ground counsel for government relations, club outreach, sponsorship marketing, and media relations is critical for such an effort to succeed.”
Put it all together, and you have one highly complex model for implementing this idea. Which makes the whole idea — at least at this point in time — still in its infant stages.