Will he stay or will he go? It all depends on what Howard wants most
It's a dangerous game of chess under way between Dwight Howard and the Magic, with the pieces positioned on the board and a deadline for someone to make the first move. March 15, the NBA trade deadline, is one week away -- and the Magic still don't know if their most prized asset wants to stay or go.
If they don't have a definitive answer in the next seven days, rival executives believe the Magic will have little choice but to deviate from their stated goal of trying to hang onto Howard and persuade him to either opt in for another year and/or sign a four-year extension on top of that worth approximately $111 million over the next five seasons -- the max Howard can get on the open market.
The machinations in the new collective bargaining agreement have been well documented. If the Magic call his bluff, essentially daring him to walk away as an unrestricted free agent, Howard stands to forfeit around $29.5 million -- the difference being the fifth year and 3 percent higher annual increases Orlando can offer compared to the two teams with room Howard has identified, the Nets and Mavericks. The difference is overrated, and potentially for more reasons than the obvious ones.
First, Howard, 26, is virtually assured of getting another max contract after the one he'd sign this summer as a free agent, meaning he wouldn't really be losing the $29.5 million, but rather deferring it. (The total difference over the next six seasons, as outlined here, is more like $10 million. What's more, Howard -- like fellow stars LeBron James, Dwyane Wade and Carmelo Anthony -- likely would request an opt-out after four years in any five-year deal he might enter into with Orlando. That effectively nullifies the Magic's advantage of being able to offer an extra year.
The other side of the coin is complicated and more difficult to quantify, but is no less important to Howard, according to people familiar with his strategy. Is the idea that bigger markets offer more lucrative endorsement opportunities an antiquated concept, or one that actually would matter to a player like Howard, who already has become one of the most popular basketball players in the world after seven-plus years in Orlando?
There's no easy answer, as the only evidence we have is anecdotal. But the answer that rings with the most truth is: It depends on the player and what he wants. If Howard wants more global exposure and the opportunity to eclipse whatever money he'd be leaving on the table by leaving Orlando, those opportunities will be there for him if he chooses the Nets and joins Deron Williams in Brooklyn next season.
"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."
Though Schwartz declined to quantify Williams' financial windfall from the new deals he's received since getting traded to the Nets, there are really two reasons behind the additional exposure: market size and his decision to break ties with his longtime agent, Bob McLaren, and sign with Schwartz, whose New York-based Excel Sports Management has a well-oiled marketing and promotional wing. The operation has offices in Los Angeles, but Schwartz -- whose NBA client list is second only to Arn Tellem's with $171 million in player salaries under his umbrella -- moved the headquarters to New York because that's where the corporate dollars and connections reside.
"Dwight Howard playing with Deron Williams and having a winning team, plus being in a market like Brooklyn, there will be lots of opportunities," said a sports marketing executive who requested not to be identified because he works for an agency that competes with Lagardere Unlimited, which represents Howard through agent Dan Fegan. "And I think that should play into his decision. The New York market compared to other markets, the opportunities are not going to be the same off the court. You're talking about the No. 1 media market in the country and [$2.5] million people in Brooklyn alone, and New York is still the hub of the corporate world. You've got every kind of industry, ten-fold."
What do those opportunities equate to for a player? It depends on what the player wants. Howard has done just fine in Orlando, and James turned down the opportunity to play in the NBA's biggest market when he spurned the Knicks' free-agent overtures in 2010 in favor of teaming with Wade in Miami.
"Wade was comfortable with Miami, and Miami's a great city," the sports marketing executive said. "And I think LeBron probably didn't want to put the whole thing on his back; that's part of his personality, perhaps. Dwight wants that; that's the difference. I don't think LeBron wanted it, but Dwight wants it. Dwight is more interested in the off-court stuff than maybe LeBron was."
Chris Paul, who was traded from New Orleans to the Los Angeles Clippers in December under circumstances similar to Howard's -- both had the opportunity to become free agents after the season and had expressed a desire to play elsewhere -- said the difference between the marketing opportunities he's received in L.A. compared to New Orleans has been "huge." So many offers, he said Wednesday night after the Nets beat the Clippers 101-100, that he's had to turn many of them down.
"It's a totally different market," Paul said.
But as Anthony has learned in New York -- the Knicks are 18-21 after losing to the Spurs Wednesday night, with Anthony in the crosshairs of criticism -- a player's address is far from the only key to his success.
"I think at the end of the day, when you win, that's what opens the door to any marketing opportunities," Paul said. "Honestly, when we were great in New Orleans in '07-'08, it wasn't about where you were or anything like that."
So as Magic GM Otis Smith, CEO Alex Martins and 86-year-old owner Rich DeVos -- who saw Shaquille O'Neal leave Orlando for L.A. as a free agent in 1996 -- wrestle with whether to trade Howard by next Thursday or not, they are dealing with forces that transcend basketball and even the salary cap and trade rules. They're dealing with the whims of a 26-year-old athlete and the pull of a multi-billion-dollar industry that views Howard as a magnet for more millions if positioned in the right market.
"If Dwight and Deron can have a great partnership and the ability to go into this new arena, they can create something special," the sports marketing executive said. "They may not win immediately, but to build a team and a franchise around them in a market such as that, I think is a really unique opportunity that you don't get very often."
Though deputy commissioner Adam Silver said during All-Star weekend that shoe companies do not put market-size incentives in their endorsement contracts, it is well known in basketball circles that Adidas would not be disappointed to see Howard land in Brooklyn. Adidas recently signed Chicago Bulls star and reigning league MVP Derrick Rose to an endorsement deal reported to be worth as much as $200 million or more. Cornering an even bigger market with Howard, who also is with Adidas, would help immeasurably in the company's efforts to compete with Nike.
Which brings us back to our original question: Does Howard want to stay or go? Rival executives say that if the Magic don't have a firm commitment from Howard by next week that he'll stay with the team beyond this season, they have to assume he's gone.
"I think they've got to trade him," one rival GM said. "It's a hell of a risk if they don't."
And what awaits Howard in his new home, assuming he's getting one? Potentially more exposure, more money, more endorsement deals ... and the same challenge that confronts all of the league's top stars no matter where they play: Do you want to be rich and popular, or do you want to win?
"My team last year in New Orleans, we beat Miami," Paul said. "At the end of the day, you've got to play the games. It's never about what it says on paper."
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