Lockout looms

Following a three-hour bargaining session between the NBA and National Basketball Players Association, both sides walked away from the table far apart on several financial issues and the players opposed to a new salary cap system.

"It's with some sadness that we're going to recommend this to the (labour relations) committee because a lockout has a very large impact on a lot people, most of whom are not associated with either side," NBA Commissioner David Stern said after meeting with the union at a midtown Manhattan hotel.

The lockout, which takes effect at 12:01 a.m. on Friday, threatens the start of the 2011-12 season in late October and marks the NBA's first work stoppage since the 1998-99 season was reduced by 32 games to 50.

It also marks the second major North American sports league to shut down its operations, following the National Football League, which installed a lockout in March that is ongoing.

NBA officials have said 22 of the league's 30 clubs are losing money and that they are seeking contract changes to offset net losses they claim run to some $300 million.

The current agreement calls for 57 per cent of basketball related income be distributed to the players under a $58 million per team cap system.

The owners have asked for the revenue split of the $4 billion pie to be 50-50, while the players reduced their counter proposal to 54.3 per cent, or $100 million a year of additional revenue to the owners over a five-year term.

The players offered an amended proposal at the meeting but the gulf between the sides was so wide that even union chief Billy Hunter termed it "a baby step."

The NBA did not offer a new proposal of its own.

"We took a baby step, they didn't take any at all," said Hunter, who would not discuss his proposal. "They started from what we considered an extreme number (initially) and trying to get to where we are, or us get to get to them, is mammoth."

The labour dispute comes after a rousing NBA season that saw increases in the league's TV ratings, franchise valuations, website traffic and merchandise sales, and a stirring NBA Finals between the Dallas Mavericks and Miami Heat.

"We had a great year in terms of an appreciation of fans for our game, just not a profitable one for our teams," Stern said. "The goal here is to make our league profitable."

Stern said the average salary for an NBA player would be $5 million a year under the owner's proposal, while the players' plan would increase that number to $7 million by the sixth year for the more than 400 NBA players.

Hunter, accompanied by NBA players Derek Fisher, the union president, Maurice Evans of the Washington Wizards and Matt Bonner of the San Antonio Spurs, said he felt the lockout was inevitable and that he hoped it might spur on serious talks.

"We just haven't been able to find that happy medium," said Hunter. "They are going to lock us out and now maybe we can really begin to negotiate."

The two sides have met twice a week for most of the past month and Hunter said the talks were much more professional than in 1998 when there was a lot of acrimony.

Stern said discussions were more civil but he remained concerned. "We're not closer," Stern said, when asked how these negotiations compared to the 1998 ones at this point. "In fact, it worries me that we're not closer."

The costs of a lockout could be enormous, particularly if an entire season was lost. The NBA's most valuable franchises such as the New York Knicks and Los Angeles Lakers, could lose more than $200 million, according to estimates by Forbes.

Duke University law professor Paul Haagen, a sport law expert, said not to expect a quick NBA labour resolution.

"The sides are many, many millions (of dollars) apart, and it is hard to see where the give is going to come," he told Reuters.

"This will likely go through at least the summer. There is not enough amount of pain right away, but some point will come when people will be losing lots of money."

Hunter held out hope for a compromise.

"Obviously, the clock is now running with regard to whether or not there will be a loss of games," he said. "So I'm hoping that over the next month or so that there will be sort of a softening on their side and maybe we have to soften our position as well."