To understand the NBA’s current quandary in China is to acknowledge how important cultivating the nation’s leaders and consumers is to the league’s long-term marketing objectives.
China is basketball mad and has been for decades. And its particularly crazy for the NBA, its players, its games and perhaps most importantly, its merchandise.
That is why the NBA was planning to play exhibition games in the nation this week. It was the league’s latest push to integrate itself with the nation’s residents and its booming industries.
But the fundamental good faith between the league and China developed a serious fissure when Houston Rockets general manager Daryl Morey tweeted his support on Friday for those protesting the Chinese government in Hong Kong.
In Beijing, Morey’s comments constituted a major diplomatic slap in the face. And a result, the nation has begun to push back against the NBA in a way that endangers the relationship and can conceivably cost the league hundreds of millions.
China’s state-run television decided to cancel plans to broadcast the NBA preseason games between the Los Angeles Lakers and Brooklyn Nets in Shenzhen and Shanghai. In response, NBA commissioner, Adam Silver, forcefully defended the right of his league’s employees to express themselves, especially about political issues.
Those words were in direct opposition of Silver’s earlier stance on Morey’s words when he seemed more conciliatory, perhaps more intent on preserving ambassadorial and business relationships with China.
The cancelation of the broadcasts represented just the latest actions taken in China to punish the NBA for Morey’s comment. An entire series of events, from clinics to fan functions, have been scaled back or canceled.
“We voice our strong dissatisfaction and opposition to Adam Silver offering as an excuse the right to freedom of expression,” China Central TV said in its statement announcing the cancellation of the N.B.A. broadcasts. “We believe that no comments challenging national sovereignty and social stability fall within the scope of freedom of expression.”
Silver was planning to travel to Shanghai on Wednesday in hopes of mediating the situation with Chinese government officials.
“But I’m a realist as well, and I recognize that this issue may not die down so quickly,” said Silver on Tuesday from Japan, where the league also staged a preseason game this week.
Part of Silver’s problem is also that he’d received severe blowback from political figures in the United States angry with his original apology to the Chinese, a statement in which he used the word “regrettable.”
“It is inevitable that people around the world — including from America and China — will have different viewpoints over different issues. It is not the role of the N.B.A. to adjudicate those differences,” the NBA said in a statement on Tuesday.
“However, the N.B.A. will not put itself in a position of regulating what players, employees and team owners say or will not say on these issues. We simply could not operate that way.”
It’s clear what the Chinese government is trying to accomplish: It wants the NBA to publicly denounce Morey’s statement. That’s not happening. But if its doesn’t happen, both the government and major Chinese companies doing business with the NBA were prepared to end their relationships.
It might be too late for the NBA. Many Chinese companies, including a sportswear brand that works with NBA players, have already announced the end of their affiliations with the league.
As of now, the planned exhibition games are still scheduled to be played on Thursday and Saturday. The Nets, by the way, are owned by Joe Tsai, the billionaire co-founder of the Chinese e-commerce firm Alibaba. Unlike the league, Tsai has been critical of Morey’s tweet on social media.
But on Wednesday, the NBA postponed its media availability for the Lakers and Nets, citing the uncomfortable political climate.
In an interview with CNN earlier this week, Silver seemed irritated.
“I will say I’m a bit surprised that CCTV canceled the telecasting of preseason games, and specifically named me as the cause,” Silver said. “It’s interesting, while at the same time in the U.S. media, there is some suggesting I am not being protective enough of our employees. Clearly, they’re seeing it the other way in China, but I think, at the end of the day, we have been pretty consistent.”
As you might expect, the one NBA figure who has been willing to talk about the situation is San Antonio coach Gregg Popovich.
“He (Silver) came out strongly for freedom of speech. I felt great again. He’s been a heck of a leader in that respect and very courageous. Then you compare it to what we’ve had to live through in the past three years (the presidency of Donald Trump), it’s a big difference. A big gap there, leadership-wise and courage-wise.
“And it wasn’t easy for him to say. He said that in an environment fraught with possible economic peril. But he sided with the principles that we all hold dearly, or most of us did until the last three years. So I’m thrilled with what he said.”
At the core of the NBA’s problem with China is that Mory apparently insulted Yao Ming, the former Houston Rocket, who now runs the Chinese Basketball Association. The CBA announced it would no longer to do business with the Rockets.
“I think Yao is extremely unsettled,” Silver said. “I’m not sure he quite accepts sort of how we are operating our business right now, and again, I accept that we have a difference of opinion. I’m hoping that together Yao Ming and I can find an accommodation. But he is extremely hot at the moment, and I understand it.”
A potential insight as to whether the preseason games will be played was the announcement that Vivo, a smartphone manufacturer, was pulling its financial support as presenting sponsor of the event.
“I’m sympathetic to our interests here and to our partners who are upset,” Silver said. “I don’t think it’s inconsistent on one hand to be sympathetic to them and at the same time stand by our principles.”
More bad news for the NBA: Stores around China were pulling apparel of the Rockets from their shelves. Because of Ming, the Rockets were likely the most popular NBA team in the nation.
“That’s what this country is about: freedom of speech,” Clippers coach Doc Rivers said after practice Tuesday. “And we should always have freedom of speech. But … freedom of speech does not mean freedom of consequences.”