by De’Juan Galloway
Lebron James is soon going to make a decision on where he’ll be going next -Chicago, Cleveland, New York or Miami? One story within that discussion is the possibility of James joining Dwyane Wade on the Miami Heat team. A potentially mutually beneficial move that involves sacrifices, economics, and unimaginable potential earnings on the endorsement front. If James intends on winning a championship(s) — he must ask himself, ‘is Cleveland the place for it to happen?’ If the Cavaliers short comings in the playoffs are any indicator of the future, Miami may be his ticket.
But James doesn’t touch the shores of South Beach without sacrifice. Primarily, it would be necessary for his loyalty to Cleveland to take a back seat for winning sake. Kevin Garnett is an example of someone who stuck with Minnesota out of loyalty and fell short of the ultimate win–until his arrival in Boston. Secondly, Miami’s $43 million of available capital could turn into $49 million with a trade of Michael Beasley for monetary rights to another team, freeing $6 million. Toronto Raptors free agent Chris Bosh could then sign on for $13 million .
The most strategic move for all the three proposed free agents would be to take a salary cut, accepting $13 million instead of $16 million, creating $10 million of cap space to lure a key role player. If this were to happen, everyone’s endorsements would peak. Collectively, the earning potential of the team’s collaborative endorsements could literally change the landscape of athletic endorsements. The sum total of James and Wade’s following boasts unlimited brand loyalty and together they could redefine the manner in which athletics and commerce are combined.
Unquestionably, a star duo comprised of the league’s top names increases the potential at a championship. Besides the obvious lure of Miami, many can bet that Lebron’s lawyers are reminding him of the tax rates for each locale, making the Knick’s pitch even less appetizing given New York’s high tax rates. As the teams converge in Ohio to make their pitches to Lebron, the opportunities remain open. However, all the free agents have yet to finalize their decisions.
Check out our original story on The Economics of a NBA Championship!