OT: How much is LeBron really worth?

Submitted by Sambojangles on July 12th, 2010 at 5:24 PM

I was intrigued by the whole LeBron free agency process, even though I'm not usually a basketball fan. When he announced that he was going to Miami, I was not surprised, although I initially thought he would go back to Cleveland. Then I got thinking. The NBA has a salary cap, so LBJ had to choose between teams based on other characteristics, because the money was the same no matter where he went, because he was obviously going to get a max deal. What if the free agent market was unrestricted? How much do you think he could have gotten? Would his decision have changed?

I think that Cleveland would have offered much more than any other team in this scenario, because he was everything that team and city had. Gilbert, in losing James, has lost about $100 million in value from the team. New York, Chicago, Miami, and the other teams are all much more valuable, and did not stand to lose so much from missing out. As for actual numbers, I think Lebron's contract could have been over $200 million for about six or seven years. That's well over $30 million a year, and probably one of the biggest in all of sports, at least in America, ever.

Comments

Engin77

July 12th, 2010 at 7:31 PM ^

$9,090.00 plus 5.925% of the amount in excess of $200,000; from Ohio Tax Rates. The effective rate is a little lower, since state income tax payments are deductible from federal income taxes.
Bottom line: nowhere close to the $30 million for the final year. But LeBron probably figures he'll be worth more than $30 million with several NBA Championship rings on his fingers; this way he gets to sign a new contract a year sooner.

mgopat

July 12th, 2010 at 5:53 PM ^

I know this isn't exactly what you asked, but if one were to really ask how much a certain start player is worth, it depends on who is doing the paying. When MJ was in Chicago, his salary was just under that number (if I remember correctly), but does that really reflect what he was worth? What if the city of Chicago were responsible for paying him? I bet that his mere presence on the team was worth well over $100 million of annual economic activity in the city of Chicago alone, if not far more, taking into account ticket sales, merchandising, travel expenses to see the games, increased media viewership in the area, etc. I bet the Mayor's office would happily fork over $50 million a year to keep him around.

clarkiefromcanada

July 12th, 2010 at 5:57 PM ^

Part of me wants to say enough already about LeBron and "the Decision". It seems he took less than market value so I guess if you want to work for an employer with your friends then it's going to cost you something. I can't imagine the NBA Players Association is having a LeBron to Miami barbecue since the other owners must be rubbing their hands together with the mantra "LeBron took less money and so should you".

As for Dan Gilbert's paper loss of $100 million on the franchise, let's be realistic, he wasn't selling anyway. 

artds

July 12th, 2010 at 6:26 PM ^

If the free agent market was unrestricted, then one thing would be for certain: whatever team got him would have overpaid, and they'd have lost big money on the contract in the long run.

Team owners are prone to the same kind of irrational exuberance as ordinary investors whenever there’s a “sexy, gotta have it” investment opportunity being hyped up, and those opportunities are rarely, if ever, good investments.

ntl002

July 12th, 2010 at 7:27 PM ^

It would be extremely difficult to determine Lebron's contract, mainly because almost every other player in the league would have a different contract as well. The NBA could very easily turn into baseball, where players like Lebron arent even considered options by lower market teams.