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In A Summer Of Inflated Contracts, Who Got The Best (And Worst) Value?

This is a Rookie Contract piece. Rookie Contract is a column here on The Sideline Sports. It provides analysis on business deals and decisions in the world of sports, as well as reports on revenues, endorsements, and contracts. Read more here.

This summer in the NBA was unprecedented.

With over $3 billion handed out in contracts, it was hard to not gasp at many of the figures.

Players who averaged less than 5 points per game received contracts worth over $50 million guaranteed. Players who are second or third scoring options on teams received contracts that pay them more million per season than points they averaged last year. And players who’s best games so far in their career is a nice 14 point, 8 rebound outing got handed the max.

It was truly unfathomable to see. Both as a fan of the NBA and an individual who appreciates the business side of sports, the league saw what many on the surface could call a disgraceful summer that inflated the contracts and market value of nearly every player signed.

But we must be quick to not jump at the numbers outright. Does it piss me off that Solomon Hill, who averaged 4.3 PPG last season, gets $52 million guaranteed to play a game that he isn’t even all that good at? Of course. But it is all relative.

This chart, from Matt Ellentuck, an SB Nation writer, shines some light on the new look NBA.

Screen Shot 2016-08-11 at 02.23.33

There is a lot to take in here, but what this chart does is simple. It takes the contracts handed out this past summer and splatters them in a way that shows what their equivalent is, with regards to percentage of salary cap, as if they were signed with the normal $70 million cap of 2015.

Here is a closer look –

Screen Shot 2016-08-13 at 18.00.28 Screen Shot 2016-08-13 at 18.00.43

The reason we find these new contracts so disgusting is mostly because we don’t understand the market value of this new market. It is hard to gauge, especially with nothing like this ever occuring in the history of the NBA.

Even the executives didn’t know how to adjust to it, which is part of the reason so many of the contracts given out were so ludicrous.

With the new market established, the best way to understand it is to reference what we were previously comfortable with. That is exactly what Matt Ellentuck did so kindly for us, and it allows us to dissect these contracts.

Here are some of my favorite deals when it comes to value per million in first year –

Ryan Anderson – $18.7 million in new cap, $13.9 million in old cap.

Anderson is an extremely talented stretch four who brings tons of versatility to whatever team he plays for. While injury prone, Anderson is a unique talent in the NBA.

Is almost $19 million a season for him a bit ludicrous? Yes.

But compared to the old cap, $14 million makes a lot of sense for his kind of game changing talent. I like this deal for Houston, and I am sure that Anderson feels the same way.

Marvin Williams – $12.7 million in new cap, $9.4 million in old cap.

Marvin Williams took a bit of a hometown discount this summer for the Hornets. This was a very gracious move, and it was one that allowed Charlotte to sign a backup point guard and center. That will help Charlotte in the playoffs this season, which is what Williams wants – to win as a Hornet.

But still, his contract is beefy for his 12 point, 6 rebound services. $13 million is nearly double per season than his first contract with the Hornets, a 2 year, $14 million deal.

But the way that Williams changes the game for the Hornets, going from a shooting guard 4 years ago to a stretch four, along with nice defense and a a quick release, makes a $2 million raise per season well worth it, if you were operating under the old cap.

Matt Dellevadova – $8.9 million in new cap, $6.6 million in old cap.

Photo via www.cavsnation.net
Photo via http://www.cavsnation.net

Delly, the Aussie sensation, is coming off a world championship with the Cleveland Cavaliers. He was living the life, as the sixth man of the top team in the East. Despite falling out of the playoff rotation a bit, Delly knew he was in for a pay day.

He brings grit and intensity to both sides of the ball, and for that, there was interest. He could have likely signed big deals with Brooklyn or Philly to be the starter, but instead he signed with the Milwaukee Bucks, a team he knows he will come off the bench for. As a RFA, Cleveland had the chance to match, and they did, but in a sign-and-trade move that saw them net something in return for the Australian point man.

Delly is a valuable player for any team in this league. Just ask LeBron James –

““That’s a guy who is dedicated, who never cared about guys saying that Delly is not fast enough, Delly is not strong enough, Delly can’t shoot it well enough, Delly is not an NBA player. Well guess what? Delly is a champion. Thank you Delly.””

His contract, in the old cap, is a modest backup point guard salary. But he is going to enhance the Bucks in many more ways than any average backup. Teaming up with the gritty players like Jabari Parker, Giannis Antetokounmpo, Khris Middleton, and Michael Carter-Williams, the Bucks are going to have one of the nastiest, toughest defenses in the NBA.

Nicolas Batum – $20.8 million in new cap, $15.5 million in old cap.

The Hornets went into the offseason needing to keep Nicolas Batum. The French sensation, in his lone season with the Hornets, averaged 15 points, 6 rebounds, and 6 assists and was a leader of a young team with deep playoff aspirations.

They did exactly that, giving him the 5 year max.

Batum has never been a max player in this league. But in today’s NBA, a max contract is less about how much money a team pays and is more about how valuable a player is to a teams success. The max says, “we cannot let you go.” That was the case here.

And, after the season Batum had, teaming with Kemba Walker and leading the Hornets to be tied for the third seed in the East, he deserved it. That $15.5 million in the old cap does him justice, and is a deal I would have given him any day.

Andre Drummond / Al Horford / DeMar DeRozan – 4 year / 5 year maxes, ranging from $22 – $26 million in new cap, all under $20 million in old cap. ($17-$19.5)

Drummond

All four of these players deserved their max contracts. While their contracts will swell to over $20 million per season in their next few years, these guys are amazing value, in new cap or old. Similar to Batum, each player is either integral to what their team is building, or, in Horford’s case, about to be.

These guys were going to get maxes from someone, so you can’t blame these teams for locking them up.

 

Now some of the worst. These were bad. Very, very bad.

 

Timofey Mozgov – $14.9 million / new cap, $11.1 million / old cap

Ok new cap or old this is the worst contract in NBA history. Mozgov, while not a bad basketball player, just received the deal of a lifetime.

In the NBA, every contract is fully guaranteed (aside from specified training camp or minimum deals). That means the Los Angeles Lakers organization will, eventually, stock Timofey Mozgov’s bank account with $64 million in cash.

Just think about that. In his first year, Mozgov will earn more than Larry Bird earned his whole career, and more than Michael Jordan earned in his first 8 seasons. In fact, Mozgov will earn more in his first season than the entire Chicago Bulls roster, plus coach Phil Jackson, in their championship winning season in 1990-1991.

Mozgov averaged a whopping 6 points and 4 rebounds last season, which included riding the pine for the entirety of the Cavaliers Finals victory.

But you just have to feel happy for the 7’0″ center from Russia. If not happy for him, you can at least envy him. He is coming off a world championship, and he just got a $11.5 million raise.

Maybe we can enjoy this great photo of Mozgov drinking wine, eating a brownie, smoking a cigar, and holding a WWE belt. But what we can’t do is respect his contract.

Via Ronald Martinez/Getty Images
Via Ronald Martinez/Getty Images

Let’s see how this deal works out for Mitch Kupchak and the LA Lakers. At least it was the only bad deal he handed out this summer, right?

Right?…

Luol Deng – $16.8 million / new cap, $12.5 million / old cap

Oh, yep. Luol Deng, who played an integral role in Miami’s playoff run, got paid$72 million this summer.

Luol Deng, a 31 year old veteran who has bounced around the league the last five years, got paid $72 million this summer.

Luol Deng, a 31 year old who’s biggest contributions come from hitting three’s in the corner and being the first line of defense against the premier wings in this league, got paid $72 million this summer.

Deng is coming off of a 3 year, $30 million deal with the Heat, and many didn’t think that after the way he played with Miami that he would be getting a big contract this summer. In fact, even in the new cap, I didn’t expect Deng’s contract to get above $8 million or 3 years at most.

But nope. Mitch Kupchak decided to toss Deng $72 million over 4 years to groom in his youngsters and develop something of a winning team for the Lakers.

This deal made no sense, in terms of money, in terms of fit, in terms of years, or in terms of sanity.

Don’t be surprised if Kupchak is looking for a job next summer after wasting much of LA’s $40 million in cap space on role players.

Tyler Johnson – $12.5 million / new cap, $9.2 million / old cap

This deal was one that you can’t criticize Miami as much for as you can criticize Brooklyn for offering it. Johnson, a 6’4″ combo guard with two years experience, has had minimum time to showcase his abilities in this league, playing behind Dwyane Wade for his whole career.

But Johnson, nonetheless, has potential. However, the good ole Brooklyn Nets really know how to kill a buzz, don’t they?

Johnson was content with waiting on Wade’s decision, then signing offer sheets from wherever he gets them. But the Nets just had to toss this 24 year old guard who averaged nearly 9 points in 24 minutes a night last season, a 4 year, $50 million offer sheet.

That is absurd. That kind of money for a combo guard, who in effect can neither play point guard nor shooting guard? Ridiculous.

The Nets already got PG Jeremy Lin on a bargain deal, so it didn’t make sense for them to go after Johnson in the first place. But to pour so much money into an unproven talent was downright offensive.

The Heat panicked, and they matched the deal after Wade left. Brooklyn was saved, Miami was screwed, and Johnson was paid.

Chandler Parsons / Bradley Beal / Harrison Barnes – 4 year maxes (Beal had 5 year extension), $22.1 million / new cap, $16.6 million / old cap

These are the opposites of Horford / DeRozan / Drummond’s deals. As I mentioned, those max deals were to keep these integral players onboard for what the teams were building or to be the main pieces of the future for those teams.

The roles are the same for these three. Beal was the second scoring option on the Wizards this season and has shown flashes of brilliance since his draft day. Parsons and Barnes are forwards that their new teams feel can push them out from mediocrity, or be main pieces for the future.

The logic here is not unwise. Paying money for young guys is the way this league operates now. But what is unwise is the players these executives chose to mortgage the future for.

Parsons is an injury machine, and doesn’t provide much on offense other than three point shooting.

barnes

Barnes, while a player with loads of potential, has never been a scoring threat in this league, even if he has shared courts with Steph Curry and Klay Thompson his whole career. His appeal makes sense, but his $94 million doesn’t.

Beal is my least favorite of the three. He provides you around 17 points a night off 45% shooting, which isn’t too shabby. But isn’t too shabby should never translate to the fifth largest contract in NBA history.

Until Beal shows he can score 20 a night and lead his team to playoff victories, his contract should be a third of what it is.

Solomon Hill –  $11.2 million / new cap, $8.3 million / old cap

You knew it was coming. I just had to rip on it.

Perhaps with the worst contract in league history aside from Timofey Mozgov, Solomon Hill had a great summer.

Solomon Hill averaged 14.7 minutes per game this past season. He scored an astounding 4.2 points per game, and he had a player efficiency rating of 12.23, which is 2.77 less than the average NBA player.

Yep. That means a subpar player, who averaged less than five points, got a 4 year, 52 million dollar contract.

But that isn’t even the best part. The best part is that the Indiana Pacers, Hill’s former team, declined his rookie contract’s team option of just $2.3 million for this season. That means the Pacers didn’t even deem him worth $2.3 million for one season, which is nearly a minimum contract in today’s NBA.

But the Pelicans decided to offer $52 million over four years. Makes a lot of sense, right?

It is clear that the new salary cap offers a lot of problems in gauging talent and pairing that talent with a market value. But the one thing that doesn’t change is that executives should know what they are paying for.

Danny Ainge knows what he is getting when he commits $115 million to NBA All Star Al Horford. Rick Cho knows what he is getting when he resigns his two free agent forwards to big deals. And Daryl Morey knows that he is getting a seasoned veteran and marksman when he gives Ryan Anderson $80 million.

Those are good deals. Those are paying for production. But what is Pat Riley getting when he takes on Tyler Johnson’s massive deal? Or Mitch Kupchak when he gives a center who was benched on his previous team $64 million?

That is what makes up bad deals. It is hard to understand what is an overpay in the league now, because everything is an overpay.

The best part about all this? Once fans, GMs, and players get used to this new cap, it will spike again next summer.

 

 

 

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