David Falk’s State Of The NBA

David Falk re-entered the sports agency world in 2007 (representing draft pick, Jeff Green), and has not been afraid to vocalize his opinions about the industry ever since.

“The sports agent business has become so corrupt — I would not encourage anyone to try to become an agent right now.” [Short and Sweet] – 4/23/08

“Instead of evolving, the sports agent business has devolved. We’re talking about reverse evolution. It’s basically unregulated and there’s wholesale cheating going on. I’m not angry about it. It’s just that it’s about buying clients instead of building relationships.” [Another Darren Interviews An Agent] – 5/2/08

“A guy who has been in the sports business for 40 years, and was basically cryogenically frozen, resurfaced last year, and we both competed for the same player this year. The player eventually went with me, but three days after this player told this agent he selected me, this agent told him, ‘You’ve made a terrible mistake. David is a really bad person. I’m here for you if you change your mind.’

The joke is that this was a person I once worked for and later he worked for me. Then I find out from this player that this agent told him that he did Michael Jordan’s first Nike deal. That’s ridiculous. That’s like Pluto saying he invented the Polio vaccine that everyone knows was invented by Jonas Salk. So I told this player, ‘All you have to do is call Michael and he’ll tell you David did the deal.’

“The truth is that person wasn’t even sitting in the room when we did the deal. He was totally uninvolved. But that’s the state of the business. It’s despicable that this agent would be stupid enough to say he negotiated Michael Jordan’s Nike deal. And it’s unethical and illegal to solicit a client after the kid said he had decided on another agent. He should be decertified for that.” – [Falk Downs Dell] – 5/24/08

Falk has a new book out called, The Bald Truth, so you had to figure that the long-time agent would throw some controversial quotes to the press in order to gain some publicity.  Falk spoke to Howard Beck of the New York Times about an impending labor battle between the NBA and the NBPA. Falk stated,

“I think [the labor battle is] going to be very, very extreme, because I think that the times are extreme. The owners have the economic wherewithal to shut the thing down for two years, whatever it takes, to get a system that will work long term. The players do not have the economic wherewithal to sit out one year.”

Should agents, players, and owners be worrying now about Falk’s Doomsday in 2011?  Will all the power be in the hands of the owners and Commissioner David Stern?

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  • I think Falk is wrong to put this all on the players. The major problem with the NBA right now is not the players share of the money (remember, the escrow system makes sure that players don’t receive more than 57% of the revenue), but the fact that the league is behind the MLB and the NFL. Just a little portion of what I am talking about: In the NFL, home team splits the gate 60-40 with the road team. In the NBA the home teams keep everything. In the NFL 70%-75% of team revenue comes from revenue sharing. In the NBA it is only 20%-25%. In the MLB 35% of each teams local media revenues (TV, Radio, etc.) are put into a pot and redistributed. There is no such agreement in the NBA. In the NBA $49 million was redistributed for revenue sharing (via the lux tax and the escrow system) in 2008, while in the MLB $300 million was redistributed. Look at the income distribution from last year: http://www.forbes.com/lists/2008/32/nba08_NBA-Team-Valuations_Income.html Outside of the Spurs, the small market teams are struggling while the large markets are thriving. The discrepancy is only going to get larger as the league is handing off local digital rights to the individual teams. Of course the large market teams will pocket a ton of money, while the small markets will hardly see a dime from this arrangement. The players association needs to take a stance and force the owners to get their financial houses in check before they come and ask the players to give up money.

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