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The NBA has issued updated projections for the 2016-17 salary cap and luxury tax thresholds.
All 30 teams were informed this week via league memorandum that the 2016-17 salary cap is now projected to be $92 million, while the luxury tax threshold is projected at $111 million.
The numbers represent a substantial increase from the NBA’s initial projections for the 2016-17 season issued last July – which called for a salary cap of $89 million and tax threshold of $108 million – as well as a massive increase over the 2015-16 cap and tax of $70.0 million and $84.74 million, respectively.
The primary reason for the jump is the new national TV rights deals with ESPN/ABC and TNT, nine-year pacts worth a combined $24 billion which will pump in an incremental $1.1 billion of revenues next season.
National TV revenues, however, aren’t the league’s only source of revenue growth. Not by a long shot.
The updated cap figures suggest the league is now expecting revenue growth for the 2015-16 season from sources other than national TV rights to come in at more than 9 percent, when the figures are finalized in less than three months.
The huge increase in revenues, which comes on the heels of a huge increase last season as well (8.2 percent year-over-year growth), will come from a variety of sources.
Gate receipts, which grew by about $100 million in 2014-15, will spike again, along with related concessions and merchandise sales, thanks in large part to the Golden State Warriors’ record-breaking 73 win season and the retirement tour of the Los Angeles Lakers’ Kobe Bryant.
Commissioner Adam Silver has also landed several new sponsorship deals and extensions of existing arrangements at rates that far outpace their previous amounts. Read more…