00:00Hello, everyone. So happy to be here, really happy to be here with Adam Silver to talk for a few minutes about not just basketball, but the economic power of sports.
00:10You know, this is a room of people who invest and lead, and I would love for you to help them understand how sports can be an economic and business catalyst.
00:22Well, thanks, Jason, and wonderful to see all of you. Mike Bloomberg began this morning by saying we're all here to change the world, and I know you and I were doing something with a group of African investors earlier this morning, and many of you are aware that Nelson Mandela famously said sport has the power to change the world.
00:42I'm almost sure when he said that he wasn't thinking of change the world from an economic standpoint. It was more in terms of the spirit of the people, but now jump ahead all these years to the present.
00:54We're now on a global basis. Sports has become a trillion-dollar sector of the economy, and it's because in addition to the human connections that come from sports, the enormous goodwill, the empathy we build from very different cultures, that it has become an economic engine, and not just the teams themselves, but for our sport, the arena development.
01:23And many of you are familiar with it in the United States, where think of that LA Live. It's really where it began, where it's not just the arena, but it's commercial development, residential, retail, etc., and increasingly going into areas of cities that are in badly need of investment.
01:43And then these teams become anchor tenants, and then often these arenas will have 250 separate events or so, so stand-alone great businesses.
01:55What we were saying earlier today around Africa, for example, I would say that's one continent where they have not experienced the level of sport investment as other places in the world.
02:08But on the other hand, I mean, it's just an amazing data point that the UN is estimating in just 25 years from now, 40% of the young people in the world will live in Africa.
02:20And so we see as the NBA an amazing opportunity to build the sport there, to build an arena infrastructure, and we've credited to David Stern, my predecessor, who back in 2001 said,
02:38we need to plant a flag in Africa, we need to plant a flag in Africa, we opened an office in South Africa, you know, we now have five offices in Africa, and roughly six years ago, we created a league in Africa called Basketball Africa League, because we saw that opportunity to build the sport and build economic development as well.
02:58And so how does that work from this, I'm fascinated by this nexus of sort of investment and sport and where the investment opportunities are, you're going to sell franchises in Africa, I believe, we've seen that be a very successful business here in the United States, you know, Clara Wussai was with us, what she and Joe have done, you know, with the Nets and the Liberty, you know, these are multi-multi-billion dollar businesses.
03:25Do you see the potential for multi-billion dollar franchises eventually at other places around the world?
03:33I do. I mean, I'll come to, clearly in Europe, for example, there are multi-billion dollar franchises, you know, just return to Africa for a second.
03:41I think over time, absolutely, there's no reason that those franchises shouldn't have the same global values you see in franchises in the United States, and you do in Europe.
03:52I would say in the shorter term, millions of dollars of value, no question, behind these teams.
03:57But a growth investment, really.
03:58But a growth investment.
04:00So we have a partnership.
04:02Our federation is FIBA, you know, and so they are our partners in Africa.
04:07And what we did in terms of this initial launch of the league, we took existing clubs, and those clubs are playing as part of this Basketball Africa League.
04:18So our plan has always been, once we established that arena construction has began in Rwanda, you know, President Kagame and Kigali, we have a state-of-the-art arena there.
04:31Senegal, Johannesburg, we see enormous opportunity to build additional arenas.
04:35And the thought is now that rather than take these existing clubs, that we are going to market with an opportunity to sell 12 franchises, 12 newly minted franchises, with the opportunity to build an arena complex with those franchises.
04:52Because, again, presumably the arena becomes the anchor tenant for that arena.
04:59And then as we talk to other entertainment properties, that a lot of touring acts, if they can then go to the continent and tour, you know, the economies change.
05:14As opposed to a one-off event in Lagos or whatever else or in Dakar, if you can then come and you know you can tour through several cities in 18,000-person arenas, that changes the economics for them as well.
05:26And as you say, these sort of ecosystems that grow up around the arenas themselves, you know, you think about LA Live, you think about what, you know, we were with Grant Hill earlier today.
05:36The investment that he's doing with Tony Ressler and Richard Ressler down in Atlanta around Centennial Yards.
05:41We've seen it in Milwaukee.
05:43Milwaukee is a great example as well.
05:45Let's talk about Europe.
05:48Of late, you have been talking a lot about expansion.
05:51What does that look like and how do you – that's not sort of a greenfield situation.
05:56There are existing teams.
05:57How do you sort of merge into and create something that's complementary to the existing infrastructure there?
06:04Right.
06:04So what we're looking at in Europe, again, completely independent from Africa, is that there's a very strong sport infrastructure there, largely built around soccer.
06:16Football, obviously, they're called soccer to make it easier, and rugby and other sports.
06:20But basketball is the second most played sport in the world after soccer and is highly developed in Europe.
06:29I mean, you know, several of our most recent MVPs are European, you know, think of, you know, Luka Doncic.
06:39Right.
06:40You know, you know, Jokic, et cetera.
06:43I mean, there's this, you know, Victor Wimbanyama.
06:45I mean, huge stars, you know, coming now out of Europe.
06:51An enormous amount of basketball being played in Europe.
06:53And there is – there are country leagues, and there is something called the EuroLeague, which is a pan-European league.
07:02And it's something – you know, I've been with the NBA for over 30 years.
07:04And while we're a huge Olympic sport and, as I said, enormous development of players, in some cases, more sophisticated development systems than the United States in terms of developing multifaceted, talented players.
07:17From a commercial standpoint, we haven't seen the kind of development you've seen particularly in the United States.
07:25There are not many state-of-the-art arenas in Europe.
07:28It's like even – for those who were over in Paris last summer for the Olympics, we had a fantastic basketball competition in the Berce Arena in Paris.
07:38It was – they revitalized it to a certain extent for the Olympics.
07:46But if you're in the industry, everything seems fine if you're in the seats and watching the competition on the floor, but it doesn't have the suites, the restaurants, the back-of-house room to do larger events.
07:58And that's Paris, of course.
08:01London has the O2, which has been a great advancement in Europe, but that arena is now already old, and they're looking at a new development.
08:10So we think there's the opportunity to go in in the major European capitals, again, with a joint proposition, both arena development, a multi-use facility, and all the opportunities around it, but then to – a little different than Africa.
08:25We think there's the opportunity both to create new teams and, in some cases, take existing franchises, often in Europe.
08:33It's a little – think of it like college sports in the United States.
08:36You have soccer paired with other sports all under the same brand.
08:42Real Madrid has great basketball.
08:45FC Barcelona has great basketball, but, of course, they're known for their soccer.
08:48You know, Alba Berlin, you look around Europe.
08:51So we're also talking to some existing clubs about the opportunity to then bring their teams into this new league, but also in certain markets create brand-new teams.
09:02All right.
09:02So less than a minute to go.
09:04As you look out, I mean, is it – do you envision sort of one global league where there is, like, players moving around, or is it sort of a confederation of related leagues?
09:14It's a great question.
09:15I think initially – I think confederation is the perfect word.
09:19I mean, I can imagine certainly initially in Europe that, for example, we have something we call the NBA Cup, a mid-season tournament.
09:27You could imagine teams from Europe, potentially Africa, competing in that tournament.
09:32You possibly could see teams coming into our playoffs, top seeds from other leagues.
09:38But over time, I think, for example, certainly in Europe, as plane travel gets faster, it sort of went backwards with the elimination of the Concorde, but I'm reading all the time about more opportunities in aviation.
09:50You know, when I think of the flight from New York to L.A., for example, there's no reason if we had four teams in Europe, you know,
09:56you couldn't travel, play, you know, the Knicks or Nets, travel to London, play three, four times in Europe, come back home.
10:03So I think it's very doable in our league.
10:05All right.
10:05Well, we can't see what – can't wait to see what you do next with the NBA.
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