While the Cavs work to defend their NBA title, the team has been making big money moves off the court.
The Cavs recently got a commitment for $140 million in public funding for renovations to Quicken Loans Arena. This week, the team announced a partnership with Akron-based Goodyear Tire and Rubber for its signature wingfoot logo to appear on jerseys next season.
WKSU commentator Terry Pluto explains why both of these moves have been controversial but necessary:
The Cavs are the sixth NBA team to sell the rights to a company for advertising on jerseys – a move the league approved to begin next year. Pluto says the deal with Goodyear will bring in about $10 million to the team annually.
“This sacrilege of the Goodyear wingfoot being on the jersey? Give me a break. That’s just how it is. And truthfully, sports has never been that pure. People don’t get into sports to lose money.”
Pluto says some fans are concerned that their team will become a walking billboard, much like NASCAR drivers.
“Let’s get real,” Pluto says. “Right now there’s an NBA logo on the uniform, which is a brand. You buy any authentic NBA products that’s what you get.”
And he says the NBA has taken it further. “They’ve already sold to Nike the rights to put its swoosh logo on all NBA uniforms beginning next season.”
Uncertain TV network dollars
Pluto says a main reason for the jersey rights is the uncertain future of the big TV networks like ESPN, which late last month laid off scores of journalists. ESPN also reported that it’s lost 10 million subscribers over the past several years. At the same time, the cost of broadcasting major sports has continued to rise.
“What if [the networks] can’t pay all that? And maybe they may have to end up re-negotiating with these leagues. This is the price you pay.”
Public private dollars for arenas
The Cavs, Cuyahoga County and the city of Cleveland recently signed off on a deal to fund $140 million in renovations to Quicken Loans Area amid controversy.
“Just because you put the money in and build it once, doesn’t mean you’re not going to have put more money in it,” Pluto says.
The city is committing $88 million from admission taxes for the Q renovations. Cuyahoga County has already agreed to sell bonds to help finance the project. The Cavs and Destination Cleveland will kick in the rest of the funding.
Under the deal, the public money will come from admissions taxes. “You’re not paying for this unless you’re buying a ticket to the event.”
Pluto says in the ‘90’s when Gordon Gund owned the Cavs, “he paid nothing in rent for years. What they used to do is charge off their own improvements against the rest and called it even.”
Pluto says current owner Dan Gilbert put a lot of renovations into the arena himself at first.
“Teams never pay for anything and the fact that they’re paying for half is a surprise. They hold these cities hostages for years. The cities don’t want to lose the teams.”