Under Stern Hand, League Seems to Be Rebounding

By any measure, the National Basketball Assn. has been a pretty successful business since David Stern became commissioner on Feb. 1, 1984.

“I look at a sports commissioner as a chief executive officer,” he said, looking the part with a gray suit, white shirt, razor-cut hair style and cigar, and sitting in his Manhattan office with its incongruous Kermit the Frog telephone.

“You have to please the shareholders, the employees and the consumers,” who, in Stern’s case, are the NBA owners, players and fans. “I treat it just like a business.”

In less than two years, the pro basketball business under Stern has turned around in several areas:

--The overall national Nielsen ratings were up 2% last season, including 11% for the championship series, while every other major sport has experienced significant rating drops. In the last six years, NBA ratings are up 18 percent, while college football is down 31%, college basketball is down 21%t, baseball is down 17% and the National Football League fell 10%.

--NBA attendance in 1984-85 was nearly 10.5 million, the highest in history, and 5% higher than the previous high in 1983-84.

--Player salaries have escalated from an average of $270,000 two years ago to more than $400,000.

--The final accounting is incomplete, but Stern anticipates that the number of teams making money “will be in the teens.” Three years ago, just six of the 23 NBA teams could say the same thing.

--The NBA has a drug program, which Stern says has been “a complete success for what we wanted it to do, which is to demonstrate that the owners and players were working together to solve the problem.”

The program is designed to rehabilitate first-time offenders who turn themselves in, but would ban for life three-time offenders.

Stern, however, cautions that things can go wrong too quickly to get smug about the league’s good fortune.

“There’s no sense kidding ourselves,” he said. “Things could change in the morning. The NBA is not the perfect machine now that people say we are. That we are where we are is a measure of luck. But you never know what the morning newspaper will bring.”

Larry Fleisher, general counsel of the NBA players association, said Stern’s success stems from his ability to transform himself from lawyer to businessman.

Fleisher is co-architect, along with Stern and former NBA commissioner Larry O’Brien, of the NBA’s salary cap economic system and the drug program.

“We’ve been adversaries for 14 years, starting when he was a law partner dealing with the NBA,” Fleisher said. “I had doubts that he had dealt too much with litigation, but he has transcended that problem and learned that marketing is essential.”

Fleisher said “basketball is clearly on the rise since he’s been with the NBA. He’s very bright and he’s done a fine job.”

If Stern has an area of special knowledge, it’s sports television. Starting in 1979, the year after he joined the NBA as its first in-house lawyer, he negotiated the first league-wide network cable contract with USA Cable Network and later reached agreements with USA, ESPN and WTBS.

He is awaiting the expiration of the last year of the current four-year contract with CBS. Although he won’t discuss a target figure, he delights in reading press reports that the current $22 million-a-year payoff could double or triple.

“We have a fair amount of leverage with the networks now,” he admits, a far cry from 1981 when he and the league were embarrassed that the final game of the championship series was televised on tape delay. “We’re expecting a substantial, generous increase.”

Stern has reversed the prevailing theory in television that a sport’s health was directly proportional to the number of games aired. He calls the idea “less is more.”

The number of regular-season NBA games on CBS has jumped from five in 1983-84 to eight in 1984-85 to 12 this season, and Stern says the figure could go as high as 17, “but 24 would be too much.”

Other sports commissioners, particularly former baseball head Bowie Kuhn, have been criticized for not taking an active part in labor negotiations. But Stern earned his reputation at the bargaining table, where his predecessor, O’Brien, would sit on the management side when talks got sticky.

“Negotiating came natural to me,” said O’Brien, now president of the NBA Hall of Fame. “I dealt with Congress for two presidents and smoke-filled rooms and bargaining tables were a natural place for me. And David Stern was right beside me for all of them.

“He grew significantly over the years and he was a brilliant fellow. I felt that at some point he would make a great commissioner. I felt the responsibility to build a good (management) team, and he was the captain.”

Other commissioners also praise Stern:

“David has brought basketball into full bloom,” says baseball’s Peter Ueberroth. “He combines quick wit, intelligence and good legal background with uncanny skills in enterprise and commerce.”

“I’ve spoken to David on a number of occasions and we have discussed issues of mutual concern,” said the NFL’s Pete Rozelle. “He has demonstrated a deep understanding of how a professional sports league operates. I have a great deal of respect for him.”

On a personal level, Stern’s style is unique.

Last June, during the Lakers-Celtics championship series, he joined a group of sports writers in a hotel press room. Pretzels, chips and empty glasses littered the room, and the commissioner sat down, loosened his tie, sipped a beer and talked basketball.

And when pressed to give a personal assessment of his strengths, Stern credits others then says:

“I’ve been able to deal on a day-to-day basis with the players association, and despite daily skirmishes, we keep it on a path that says we both know that what we are battling about is how to cut up the pie, but also how to keep the pie growing.”