A proposal to Derek Fisher and the NBPA (part ii, arena revenue)

I wanted to explore this proposal a little bit more, this time from the financial side of things. First, let's take a look at arena based revenue sources:

Some assumptions just to illustrate the math:

1. 28 game regular season
2. Playing in non-NBA affiliated arenas that hold 10k+
3. Playoffs: semis are best of 3; finals are best of 5

For the regular season

1. There are a total of 112 games (28 x 4, there are 8 teams)
   
2. Assuming full attendance, that means there are 1.12 million tickets to be sold
3. at an average $30 ticket price, total ticket revenue is $33.6 million
4. average $50 ticket price: revenue is $56 million
5. average $75 ticket price: $84 million dollars

For the playoffs.

1. Best case there are 11 total games, worst case 7 games
   
2. average $100 ticket price, revenue is between $11 million and $7 million

So the gross ticket revenue, assuming $50 regular season tickets, would fall between $63 and $67 million dollars. This isn't a huge amount of money for a business like this, but even after a 50:50 split with the arenas, it's more than enough to pay for everything except player salaries.

Now, there's a case to made for more expensive tickets, given that the average seat for a Laker game @ Staples is over $100, but the point of the exercise is to keep the fan-base engaged, providing high quality basketball for a low price, while at the same time putting pressure on NBA ownership.

From a financial point of view, assuming this tournament was set in Vegas, then a fan in the greater Los Angeles area could catch a game for the same total price as a seat in the lower bowl @ Staples. With back to backs and doubleheaders in the same arena, a fan could see 4 high quality basketball games over a weekend. That's got to be an attractive proposition to a hoops fan

If the NBPA were smart, they would make a deal with the hotels to offer package deals, making this easier. Now, it's important that all tickets are sold at full price, so what you offer the hotels is not discounted tickets, but guaranteed preferential seating. If you bought your tickets through the MGM Grand or the Bellagio, for instance, you'd be able to get front row or center court seating. Same thing applies to "season tickets".

Bear in mind, that this revenue doesn't include concessions or local merchandising sales. That could easily push total game-derived revenue to over $100 million.

Also bear in mind, the assumption of 10k seat arenas. Bigger or smaller arenas could change the revenue model substantially. Las Vegas has 3 venues that seat 12k+ (Mandalay Bay, MGM Grand, Thomas & Mack), Greater LA has the Forum, Coliseum & the Honda Center with Valley View in San Diego. And on the East Coast, there are many in the Boston->Washington corridor.