Chris Cochrane at the Herald had a good opinion piece about the ABA today. He points out an important fact: The ABA is a mess. A total and complete mess. And the Rainmen and the other stable clubs need to get the hell out of there. Part of the problem is that there aren’t that many choices available.
Could a league made up entirely of Vermont, Manchester, Quebec, Montreal and Halifax work? Hamilton want to get in on a team so you could add them to the mix, and if a good owner is found in New York a team may be able to work there. The existing leagues are better than the ABA, but not by much; the CBA is still recovering from the Isiah Thomas era, and the PBL and USBL aren’t proven commodities yet. The NBADL would be a pipe dream, but it’s looking to expand and has no presence in the North East. If the teams could go to the NBADL and offer a full, stable NE division in one package it may work. But are franchise drawing 1000-3000 fans DL league material?
Maybe a much smaller Canadian Basketball circuit is preferable? But I am unsure if there are enough cities to make it work: Halifax, Moncton, Montreal, Quebec, Ottawa (with a line up made up entirely of ex-Carlton players and Hamilton in the east; Saskatoon, Manitoba, Edmonton and Calgary in the west. (Vancouver means everyone needs to fly to get to and from it). I just don’t know if it’s feasible.
The thing about the ABA is that it is structurally flawed. There is no way that based on its current structure that it can work. The way in which the league generates revenue means that it’s not an accident that lots of teams fold, but that in order for the league to exist, teams need to fold. (it’s the same way the debt is not an accidental result of capitialism, but it’s needed for capitalism to be maintained.
The only source of income for the league itself is a $10 000 – $20 000 “market reservation fee” which is collected when an owner first says he wants to start a team. After that, there is no more money from the franchise. There’s no advertising or TV money, either for the league office. What this means is that if you have a team in upstate New York which lasts for seven years and draws 3000 people a game the ABA gets $10k-$20k. If you have nine teams over that same seven year period the ABA makes $90-$180k, each lasting a year or less. So everytime a franchise folds and a new owner tries to start up a team in the area, the league makes more money. Stability is not in the best financial interest of the league.
Assuming that there are only two league staff, and website and office costs are next to nothing, we’re probably looking at about $150k in expenses at the very least. This means that 10-15 new franchises need to enter the league every year just to cover basic costs (not to mention paying off the league’s huge debts). There are really only 30 -40 markets (at most) in NA that could support a minor league basketball team, so the league needs teams to fold and be replaced by new ownership. The league just can’t work.
Rumours abound that the Strong Island Sound may be folding in the coming days. The media relations office of the Sound has confirmed on a message board that the team will be folding in the coming days. Incase you didn’t know, their owner is the CFO for the ABA. The only game this directly effects for the Rainmen is a Feb. 15 away game in Long Island. Team owner/GM Darren Cioffi is the Chief Financial officer of the ABA and as such is responsible for SEC filings since the ABA is publically traded – something that the ABA has appearently not done for this quarter. When the CFO of a league decides its time to pull out, you know something is up. For anyone dumb enough to have stocks in the ABA – it was down to $0.05, down $0.03 since Thursday. God knows what it’s going to be when the markets close Friday with the CFO pulling his team out of the league.