By Official statement
Posted Jul 6 2011 2:42PM
NEW YORK -- The NBA supplied The New York Times yesterday with a point-by-point rebuttal of Nate Silver's blog posting on the NBA's financial losses. The New York Times incorporated the NBA's response into the online version of the story with the following acknowledgement from the reporter: "I simply have no way to adjudicate the NBA's claims."
In today's print edition, The New York Times inexplicably chose to ignore almost all of the NBA's responses, despite the fact that Nate Silver's blog was based solely on two sources: Forbes Magazine and a now-defunct magazine called Financial World, which as best we know went out of business in 1998.
Precisely to avoid this issue in our ongoing collective bargaining negotiations with the players' union, we shared with the union our complete league and team audited financials along with our state and Federal tax returns. The New York Times' position is that unless we are willing to disclose those same confidential financial documents to them it is appropriate for them to publish a story based on uncorroborated and unsubstantiated news reports.
Among the omissions and examples of flawed analysis in today's New York Times print edition:
• "According to data published by Forbes Magazine ... the NBA made $183 million in 2009-10 before interest and taxes."
Forbes' data is inaccurate; Forbes does not have the financial data for our teams and the magazine's estimates are wrong and unreliable. Our losses for 2009-10 were $340 million.
• "17 of the 30 NBA teams lost money in 2009-10. Most of the losses were small."
Forbes' claim is inaccurate. In 2009-10, 23 teams had net income losses. The losses were in no way "small" as 11 teams lost more than $20 million each on a net income basis.
• "The profits made by the Knicks, the Bulls and the Lakers alone could cover the losses of all 17 unprofitable teams."
The Knicks, Bulls and Lakers combined net income for 2009-10 does not cover the losses of the 23 unprofitable teams. Our net loss for that year, including the gains from the seven profitable teams, was $340 million.
• "First, according to the union, many of the supposed losses, perhaps about $250 million, are a result of accounting procedures."
The notion that $250 million of losses is due to "accounting procedures" is patently false and so vague an assertion as to be meaningless as a matter of financial analysis. In any event, there is no attribution for this statement and it seems like a curious opportunity for The New York Times to break its own policy on anonymous sources.
• "(The NBA) is a fundamentally healthy and profitable business"
The league lost money every year of the just-expired CBA. During these years, the league has never had positive Net Income, EBITDA or Operating Income.
• "[T]he leaked financial statements for one team, the New Orleans Hornets, closely matched the Forbes data."
The reporter acknowledged in yesterday's online posting that Forbes' profit/loss estimates for the two years at issue were off by roughly $9 million and $6 million, respectively, compared to the Hornets' financial statements. We are hard-pressed to understand how discrepancies of this magnitude could lead an unbiased observer to conclude that Forbes' numbers "closely matched" actual reported results.