October 9, 2019 / 3:32 AM / 12 days ago

Breakingviews - China's shot at NBA draws political foul

FILE PHOTO: May 4, 2019; Houston, TX, USA; Houston Rockets guard James Harden (13) drives with the ball as Golden State Warriors guard Stephen Curry (30) defends during the fourth quarter in game three of the second round of the 2019 NBA Playoffs at Toyota Center. Mandatory Credit: Troy Taormina-USA TODAY Sports/File Photo

HONG KONG (Reuters Breakingviews) - China may yet rue stepping up to the U.S. National Basketball Association. State television will no longer screen preseason exhibition games held in the country, it said this week, after an executive tweeted in support of anti-government protesters in Hong Kong, and NBA boss Adam Silver defended him. A lucrative business is at stake, but the league is pushing back anyway.

    The People’s Republic is adept at squeezing apologies out of multinational brands, sometimes over offences so trivial they seem manufactured. That includes listing Taiwan and Hong Kong in the “country” field in online forms, for example, or misconstruing a UBS analyst’s reference to “Chinese pigs” - in a conversation about pork prices on the mainland - as an insult to the Chinese people.

    So when Houston Rockets General Manager Daryl Morey tweeted support for the pro-democracy movement in Hong Kong, it was reasonable to assume the NBA would join UBS, Versace and Delta with a retraction. There is certainly plenty at stake. Deputy Commissioner Mark Tatum said in a 2018 interview that NBA’s China business was worth over $4 billion, thanks to a streaming contract with internet giant Tencent - NBA’s biggest partner outside of its home market – and licensing deals with the likes of Anta and Nike. Financial magazine Caixin reported the value of Tencent’s contract, renewed for five years in July, at $1.5 billion.

    But it hasn’t played out that way. Basketball is the most popular sport in China. Tencent says almost 500 million watched NBA programming on its platforms last season. Yao Ming, who once played for the Houston Rockets himself, is arguably the country’s most famous athlete. Ejecting the league from the country would hurt businesses, but irritate fans too.

    Unlike an attack on a bank or a fashion brand, going after the NBA has roused a vast population of American sports fans. It gave U.S. politicians, including presidential candidate Elizabeth Warren, an excuse to bash China and corporate greed at the same time. This may have encouraged Silver to stand by Morey after the NBA issued a regretful statement.

    If Silver holds his line, other foreign companies may be encouraged to rally behind him. That would be a whole different ball game.

Breakingviews

Reuters Breakingviews is the world's leading source of agenda-setting financial insight. As the Reuters brand for financial commentary, we dissect the big business and economic stories as they break around the world every day. A global team of about 30 correspondents in New York, London, Hong Kong and other major cities provides expert analysis in real time.


Sign up for a free trial of our full service at https://www.breakingviews.com/trial and follow us on Twitter @Breakingviews and at www.breakingviews.com. All opinions expressed are those of the authors.

0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below