The NBA Tournament With $1 Million Cash Prizes

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Hey friends,

Earlier this year, the Women's National Basketball Association (WNBA) announced the “Commissioner’s Cup,” a brand new midseason tournament designed to raise competitiveness during the regular season and attract increased viewership.

Here’s how it works: Ten early-season games for each WNBA team will act as “group play,” with teams that have the best record advancing to the mid-season tournament.

• The total prize pool is $500,000

• The winning team gets $30,000 per player

• The runner-up gets $10,000 per player

• The MVP of the Commissioner’s Cup gets $5,000

Even more interesting? Not only was the Commissioner’s cup used as a bargaining chip for the WNBA’s new multi-year streaming deal with Amazon — Google is also a major sponsor of the tournament — but the NBA appears to be watching closely, as well.

The playoff numbers have been strong so far, but despite COVID-19 providing fans with more time at home than ever, the NBA continued its decline in viewership this past regular season.

Avg. National Game Viewership (ABC/ESPN/TNT)

• 2017-18: 1.89 million

• 2018-19: 1.79 million

• 2019-20: 1.62 million

• 2020-21: 1.34 million

A lot of factors go into the decline. Still, strictly from a fan’s perspective, few regular-season games seem to carry much weight outside of Christmas Day and the occasional superstar matchup.

Yes, the leagues biggest superstar LeBron James moving to Los Angeles, where games routinely end around midnight for east coast viewers, didn’t help either.

As a result, similar to the model relied upon by international soccer, the NBA is considering a mid-season tournament that resembles the WNBA’s approach this year.

Here’s my take: The number of games, consistent amount of players sitting due to injuries, and the overall dampened competitiveness level compared to the playoffs have reduced fan demand for the NBA regular season.

A mid-season tournament will help, similar to how this year’s play-in games did, but players have to be incentivized in the right way. Cash payments might motivate some — the NBA is reportedly considering paying winning players $1 million each — but with players like Stephen Curry, James Harden, and LeBron James each making $40 million-plus annually, or about $500k per regular-season game, anything less might not be enticing enough to receive buy-in from the league’s top players.

Remember: NBA players want fewer games, not more. They’ll fight this regardless.

Instead, do they also award the winning team with an additional draft pick? Maybe a first-round playoff bye? Additional rest days throughout the season? All seem to be good options, but ultimately, they fundamentally shift more power from weaker teams to stronger teams — further decreasing the competitiveness gap over time.

There are a million different decisions to make — when the tournament takes place, the number of teams included, single site or various cities, compensation, and more — but don’t get me wrong, this tournament will eventually happen. The necessary reversal of recent viewership trends makes it inevitable.

The NBA is nearing the end of a $24 billion media rights package, which pays $2.6 billion per year. But now, the world’s biggest basketball league is reportedly seeking a $75 billion multi-year media rights package, which would pay around $7 billion to $8 billion per season.

Given most home games bring in $3 million to $4 million in revenue, certain media organizations have indicated that removing a few regular-season games to make this tournament happen might irk league owners, but to be fair, that’s peanuts compared to the return they would see on an $8 billion annual media rights package.

Ultimately, the demand for premium, global live-sports content outpacing currently available supply might mean a $75 billion deal happens regardless. But still, a mid-season tournament with seven-figure cash prizes will certainly help.

It’s now all about finding a creative option to get buy-in from the players, because if play-in games for the NBA playoffs have taught us anything, it’s that fans love the win-or-go-home model.

Have a great day, and I’ll talk to everyone tomorrow.

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