There can’t be any more depressing basketball-related piece of news for a New Jersey/Brooklyn fan to read than this quote from Deron Williams to Yahoo! Sports’ Marc Spears on the possibility of teaming with Dwight Howard over the long haul:
“It’s a decision [Howard] made for himself,” Williams said. “I really have no comment on it. He did what was best for him. I respect that. I’m still friends with him.
“Oh yeah, it definitely would have changed things. I’ve already made it known that if he would have come I probably would have stayed.”
Williams is referring to Howard’s decision just ahead of the March 15 trade deadline to opt in with the Magic for next season, effectively delaying his free agency for one year. Williams could do the same via a player option worth $17.8 million, but he reaffirmed to Spears on Monday that he will decline that option:
“People get traded all the time,” Williams told Yahoo! Sports. “They don’t get backlash as an organization. If [players] leave, we are not loyal, we are ungrateful. People say stuff to me on Twitter. They already think I’m gone. They are out there bashing me, saying to me I’m a traitor.
“I didn’t ask to be here. I got traded. I didn’t come here being a free agent. This is the first time that I’m a free agent in my career.”
Williams, of course, is right to exercise the same career self-determination any of these Twitter jockeys would want for themselves. What’s interesting is that Williams is actually sacrificing a bit of salary in doing so.
Under the new cap rules, Williams could have maximized his earnings in both the short and long term by opting in for next season at that $17.8 million price and then re-signing with New Jersey after next season via a five-year deal starting at about $18.7 million in Year 1 and growing by 7.5 percent annually after that. That would net Williams about $126.2 million over six years.
The Nets still have home-court advantage even if Williams opts out, since only they can offer him a five-year contract with 7.5 percent annual raises. Rival suitors, including the drooling Mavericks, can offer only four-year deals and 4.5 percent annual raises. But by opting out, Williams has actually deflated his next contract, regardless of which team he joins, because his maximum salary on any new contract next season is about $17.17 million (105 percent of his current salary), or roughly $600,000 less than the value of his player option ($17.8 million). Because the rest of the contract flows from the Year 1 salary, that difference compounds itself over time.
Basically, Williams’ three major options* look like this:
1. Opt in with the Nets, re-sign a max-level, five-year deal in the summer of 2013. Approximate total salary over six seasons: $126.2 million.
2. Opt out this summer, re-sign with New Jersey for five seasons and assume a max-level salary on a new deal in Year 6. Approximate total salary over six seasons: $123.8 million.
3. Opt out this summer, sign a four-year, max-level deal with another team and assume a second max-level deal down the line with that same team. Approximate total salary over six seasons: $116.2 million.
* I know there are other options, many of which I’ve discussed over the last few weeks with various experts and neutral parties, but for simplicity’s sake, let’s limit the discussion to these three most prominent ones.
Option No. 1 is off the table now because Williams will not opt in. That leaves only option Nos. 2 and 3, and as you can see, New Jersey has lost about $3 million of its home-court edge over the next half-dozen years.
Brooklyn backers will counter with two things:
1. Williams can lock in more long-term security sooner by choosing option No. 1 or option No. 2, because both push off the next max-level contract further than option No. 3.
2. Williams will enjoy greater marketing opportunities playing in New York than in any other market, including Dallas, that can offer him a max-level deal this summer.
This is the subject of considerable debate around the NBA, with non-neutral parties often falling on whatever side is most convenient for their side/client. The Nets have surely bombarded Williams with all sorts of huge estimates about what he could earn in off-court money by playing in New York versus anywhere else. The Mavericks will surely counter with different estimates and the general claim that geographic location matters little in a shrinking world held together by technology. And how about that friendly tax regime in Texas, Deron?
Williams’ agency and marketing team will bring in their own estimates, though it’s worth noting that his agent, Jeff Schwartz, has already told Ken Berger of CBSSports.com that any superstar will earn more money by playing in New York City. It’s also worth noting that Schwartz chatted on record with Berger about this right before the trade deadline and in the explicit context of whether Howard would be wise to force his way to Brooklyn and join Schwartz’s client:
“In the last eight or nine months, Deron has signed national deals with Audi, Red Bull and Metro PCS,” said Williams’ agent, Jeff Schwartz. “He’s also done a number of regional deals with other companies. Being in a larger market, there’s always more opportunities, and coupled with the fact that the Nets are moving to Brooklyn, there’s going to be a lot of corporate interest in both the team and its star players.”
What happens here is obviously going to define the next half-decade for the Nets’ franchise, which famously parted with Derrick Favors and the draft pick that became Enes Kanter (among other pieces) to take a shot on Williams. The Nets have since dealt their 2012 first-rounder to Portland and will only get to use that pick if it lands among the top three — very unlikely as of now. They acquired Gerald Wallace in that deal, presumably as bait to convince Williams that the team could remain competitive while waiting out Howard and the Magic.
And in the Eastern Conference, they could be a solid mid-level playoff team next season. The Nets, in theory, could build a good 2011-12 nucleus of Williams, Wallace, MarShon Brooks, Anthony Morrow and two pending free agents in Brook Lopez (a restricted free agent) and Kris Humphries (an unrestricted free agent). Williams’ move to opt out complicates that scenario.
Losing Williams is the equivalent of starting from scratch, but at least the Nets could go forward with two building blocks (Brooks and a re-signed Lopez) and oodles of future cap space; New Jersey has exactly $0 in guaranteed money on the books for 2013-14 as of now. Of course, that’s not quite as good as starting with a nucleus of Favors, Lopez and three other potential lottery picks, but that’s the risk New Jersey took when it traded for Williams.