By: Will Burchfield
The Pistons suffered 45 losses on the court last season.READ MORE: Coast Guard Urges Residents To Secure Equipment To Avoid False Rescue Alarms
They incurred far bigger ones at the bank.
According to an ESPN report, the Pistons lost $63.2 million before revenue sharing, the largest loss in the NBA “by a wide margin.” Accounting for revenue sharing and other factors, the team’s net loss was $45.1 million, also a league high.
The Pistons were one of 14 NBA teams to lose money last season prior to revenue-sharing payouts, and one of nine teams to lose money even after those payments had been made, per ESPN.
The eight others were the Hawks, Nets, Cavaliers, Grizzlies, Bucks, Magic, Spurs and Wizards.
The NBA signed a $24 billion television deal that kicked in last season, driving up the cap and sending player salaries through the roof. The Pistons had about $107 million on the books — roughly $13 million over the cap — the eighth-highest total in the league.
The team didn’t make nearly enough money to cover its rising costs.READ MORE: Whitmer Tours Eastern Michigan University Vaccination Clinic
As one owner told ESPN, “National revenues drive up the cap, but local revenues are needed to keep up with player salaries. If a team can’t generate enough local revenues, they lose money.”
The bulk of a team’s local revenue comes from its local media rights deals, fueled mostly by television. The Pistons pull in about $25 million per year through their deal with Fox Sports Detroit, per Crain’s Detroit.
By contrast, the Lakers, the most profitable team in the league last season, made about $150 million from local media deals, primarily with Time Warner Cable.
Per Crain’s, the Pistons deal with FSD expires in 2021, at which point “FSD is expected to pay substantially more for the right to carry games.”
The Pistons’ bottom line wasn’t helped by attendance last season. The team drew 15,979 fans per game, the sixth lowest total in the league. In terms of capacity, the Pistons — at 72.4 percent — finished dead last.
They moved from The Palace of Auburn Hills to Little Caesars Arena ahead of the upcoming season.MORE NEWS: Stimulus Check Update: Is A Fourth Relief Payment Coming?
Per ESPN, the Pistons’ extreme financial losses “help explain why (they) wanted to move out of a building their parent company owned far into the suburbs and relocate to a new arena in downtown Detroit this season, hoping that it helps boost revenue.”