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Durant Should Thank Reagan for Next Deal


The final horn ending the season for the Oklahoma City Thunder National Basketball Association franchise seemingly just sounded when the pundits began talking about Kevin Durant’s basketball future, his impending free agency and where he could find his next employment, whether that would be in Oklahoma City or elsewhere. Whatever the case, Durant is going to get a lot of money regardless of how funny his next contract may look.  Durant is becoming a free agent a year too soon as there will be much more money available in the summer of 2017 because that’s when the new Disney/Time Warner cable TV contract kicks in. The pundit talk about Durant is how he might want to be wooed by Thunder and other NBA owners and how much will those owners invest in him using other people’s money.

Durant can make hundreds of millions of dollars because of other people’s money.  This, in part, was made possible through a couple pieces of legislation signed by President Ronald Reagan in 1984 and 1986 granting athletes the ability to become rich way beyond their dreams. Under the 1984 Cable TV Act, cable TV subscribers were forced into bundled packages and sports took advantage of it. Sports channels developed and cable TV prices soared as teams and leagues charged more and more for programming and just passed it onto all subscribers, not just sports fans. You wanted ESPN, you also got CNN, no choice. The TV monies have become astronomical. Under the right set of circumstances, the other legislation signed by Reagan in 1986 gave owners 92 cents out of every dollar earned in a municipally funded arena. Taxpayers picked up the tab, not sports owners. Durant is fortunate; he will receive a huge pay day and much of that money will come from the 93 percent of people who generally never watch cable TV sports or attend games.

By Evan Weiner for The Politics of Sports Business.

This article was republished with permission from the original publisher, Evan Weiner.


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