May 11, 2006 | Business Week
Le Basket Struggles To Score
It’s an uphill battle for lesser teams, but hoops are gaining momentum in Europe
By Carol Matlack
It’s a Saturday night at the Pierre de Coubertin arena in Paris, and home team Paris Basket Racing is struggling to score. “Execute, execute!” coach Gordy Herbert pleads in English from the sidelines as the clock ticks down. Finally, Norman Richardson, a U.S.-born forward, gets off a shot, helping Paris’ pro basketball team grind out a 66-61 win.
Basketball in Paris? The City of Light is famous for many things, but basketball isn’t one of them. And Paris’ pro team doesn’t inspire much confidence that le basket, as the game is known here, will catch on anytime soon. Its home court is a 68-year-old municipal gym bereft of luxury boxes and other amenities. Typically, only a few hundred of the 4,800 seats are filled, and no wonder: With a 15-16 record this season, Paris ranks 13th of 18 teams in its division. Paris Basket Racing can’t even shake off its awkward moniker. The team belongs to the Racing Club of France, a venerable association that requires its teams to include the word “racing” in their names.
But if Parisians aren’t excited about their team, some Americans are. A group of U.S. investors organized by Entersport Management Inc., a New Canaan (Conn.) sports agency, bought Paris Basket Racing from its French owners in 2004 for $60,000 and the assumption of $2.3 million in debt. Now they’re pushing to turn the club around. “We believe teams like this will start to have some real market value,” says Reed Salwen, the club’s new president. Salwen, a 39-year-old New Yorker, has been Entersport’s chief European agent since 1999, helping to recruit such players as France’s Tony Parker, now with the San Antonio Spurs.
Salwen’s not crazy. Across Europe, hoops are catching on. Since 2000, paid attendance at Euroleague, the region’s top pro organization, has tripled to 1.4 million annually. A sellout crowd, including a big NBA delegation, watched CSKA Moscow win the Apr. 28-30 Euroleague Final Four in Prague. Companies such as Nestlé and L’Oréal have signed up as Euroleague sponsors, and the league sold broadcast rights to its current season for almost $20 million. Says league consultant and former Portland Trail Blazers President Marshall Glickman: “We’re seeing a big increase in exposure.”
FULL-COURT PRESS Still, European basketball has a long way to go before it rakes in the hundreds of millions that the NBA gets. But teams from Vilnius to Siena are making enough to build new arenas. Top players such as David Andersen of CSKA Moscow earn close to the NBA’s average of $4 million. True, the NBA is skimming off the cream of European talent. Its rosters include 49 European players, including such stars as Parker and Spain’s Pau Gasol of the Memphis Grizzlies. But that just fuels more interest. These players remain popular in their home countries, thanks to heavy promotion by the NBA. The U.S. league has TV deals across Europe and sends teams there for exhibition games.
Second-rate teams like Paris Basket Racing still aren’t cashing in, though. To become contenders they must recruit better players, jazz up marketing, and improve facilities. Salwen and his partners are working to tap Paris’ media and corporate presence. So far, only a few sponsors have signed up, including Alice, a Net provider owned by Telecom Italia. Salwen says he’d love to move to a modern arena. But he’s so strapped for cash that earlier this year he sold the club’s best player to rival Strasbourg. Salwen says the club is on track to make a profit of about $60,000 this year and to pay off its debt by mid-2007.
Even with that modest success, he’ll be hard-pressed to assemble a contending team. And without a lot more wins, it won’t be easy to win over the likes of Mahamadou Diaby, a young basketball fan from the Paris suburbs. “My favorite team? The Spurs,” he says. For now, le basket looks like a tough sell in Paris.