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April 3, 2006
The Seattle Sonics and the Portland Trailblazers have more in common than losing records and rich owners. The Northwest NBA franchises both lose money and want the public to come to the rescue.
Sonics principal owner Howard Schultz has the golden touch in business, building Starbucks into a global powerhouse recently named by Fortune as one of the most respected companies in America.
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He grew a Pike Place Market coffee shop into one of the most successful retail operations in history, yet he is unable to turn a profit on the team. A few more seats and fancier luxury boxes won't change that.
Trailblazers owner Paul Allen is the richest owner in sports and credited for turning his Seattle Seahawks into Super Bowl contenders, but Trailblazers officials say the team will lose $100 million over the next three years.
If Howard Schultz and Paul Allen can't make it work, who can?
The NBA's business model is headed for a fall. TV revenue and ticket sales don't compensate for players that USA Today says make an average of $3.7 million per year, topped by Minnesota's Kevin Garnett at $28 million. Seattle is led by Ray Allen at $14 million per year. Garnett and Allen are pretty good ballplayers, but they would still be doing well financially at half that price.
To his credit, Schultz is honoring his lease at Key Arena. Schultz and rest of the Sonics ownership group want a publicly funded $200 million renovation of Key arena. The Trailblazers also seek public help for that team.
If they don't get it, the teams may be sold or moved to cities that will come up with the big bucks. "Pay up or we are moving'' is the standard line in the sports business.
Top tier cities like Chicago, Atlanta and Phoenix already have teams, so the Sonics and Trailblazers would need to move to Oklahoma City, Las Vegas or Norfolk, Va.
It is time cities start calling owners' bluffs. If the Sonics and Trailblazers want to move, let them. Seattle and Portland will get along fine without them and it won't be long before teams from Sacramento, New Orleans, Toronto, Orlando or Charlotte come knocking at our door.
Phil Brown can be reached by email or by phone at (206) 622-8272.
The Daily Journal of Commerce welcomes your comments.