New Jersey and sports markets

By ARJUN ARORA, senior

In sports today, it is not the team’s performance alone that rakes in the revenue for its particular franchise. In nearly every single case, the location of a franchise plays a significant role in both a team’s in-game and financial success. New Jersey has been no exception to this rule.

In 2002 and 2003, the New Jersey Nets represented the Eastern Conference in the NBA Finals, facing the Los Angeles and San Antonio, respectively. Although the Nets succeeded in winning six playoff series in two years, the Nets failed to sell out games and continued to see their crowd turnouts disappoint. Over the course of the decade, the team’s attendance never ranked higher than 18th in the league. The weak fanbase in New Jersey didn’t provide the support expected for a team with success reaching over a span of several years. In the 2010-2011 season, the Nets collected the lowest revenue among all NBA teams, earning a mere $89 million.

The Knicks, who play in New York, and the Lakers, who play in Los Angeles, were generating at least $100 million more than the Nets. After officially moving to Brooklyn last spring, the Nets are now playing in an ideal location, just across the Hudson River. Simply due to this location change, the Nets expect annual revenue to increase trifold. The team is now worth $575 million, as opposed to $357 million last season, generating a $200 million jump before playing a single game in its $950 million arena.

In hockey, a similar situation is occurring for the New Jersey Devils. An impresive team in recent years, the Devils missed a loan payment on September 1 of last year and are now suffering from heavy debt. Consequently, the owners were on the verge of filing for bankruptcy. Even worse, the team is worth less than $200 million and ranked 24th in the league in attendance last season. The future looks bleak for the team, at least in New Jersey. With financial uncertainty worsened by the competition of the New York Islanders’ plan to join the Nets in Brooklyn, the Devils may have to consider relocating to another market down the road. Perhaps a change in location is exactly what this team needs to renew hope for stability in the future.

Based on these scenarios, players often desire new markets in which they can capitalize on business opportunities as a result of greater attention. In 2010, one of the NBA’s most recognized scorers, Carmelo Anthony, requested a trade from the Denver Nuggets, with New York City as his first preference. Five months later, he was granted his wish, landing with the Knicks in a blockbuster deal and promptly signing a three-year extension. Another case is that of Chris Paul, who is among the league’s best point guards. Prior to the 2011- 2012 season, he requested a trade from the New Orleans Hornets to a more desirable setting, and landed with the Clippers in the bright lights of Los Angeles, the second largest market in the league. Most recently was the extended saga of Dwight Howard, the league’s most dominant center, who was persistent on going to Los Angeles, Dallas, or the Brooklyn-bound Nets. It’s safe to say the Nets would not have been atop his list if they were still stationed in New Jersey. Players seek the big city atmosphere, which explains why the Nets, pursuing superstars like these in the 2010 free agency goldmine, came up empty. The reality of the matter is that New Jersey may not be a suitable location for a sports franchise, with the exception of the Jets and Giants, both of whom play under the label of “New York.” Is that a reason for local fans to be disappointed? Not necessarily. For Nets fans, their favorite team is now a train ride and a couple of subway stops away, thriving financially and rapidly gaining popularity. In many cases, it is in the team’s best interest to seek a change in location; although fans may be more distanced by location, they can be witnesses to drastic improvements.

Got something to say? Say it.

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s