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NBA AM: Why Teams Buy Out NBA Players

Explaining why NBA teams decide to buy out players … What are NBA players really looking for in free agency?

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Why Teams Buy Out Players:  As the Philadelphia 76ers continue to talk contract buyout terms with recently acquired forward Danny Granger and the Milwaukee Bucks attempt to do the same with forward Caron Butler, a common question is why doesn’t Team X just buy out Player Y, especially when Team X is going nowhere? There are a couple of reasons some teams consider buying out players and here are a few of them:

Changing The Culture

The Orlando Magic opted to buy out not only the remaining balance of the money they owed forward Glen Davis, they also absorbed the $6.6 million owed to him next year. In total, the Magic agreed to pay Davis some $8.6 million to not be on the team any more for a couple of reasons. They wanted to open up a roster spot and playing time, but more importantly they wanted a combative and sometimes negative influence out of their locker room.

Davis struggled with the role the Magic had for him and would often vent his frustrations to other players and to the media. Davis was never “bad” but he was clearly not a happy camper going along with the program. The Magic wanted the negative influence away from their impressionable younger players, so they got rid of him.

The New York Knicks did much of the same with forward Metta World Peace and guard Beno Udrih. Neither had carved out a role in New York under head coach Mike Woodson and both expressed frustration publicly and privately about how things were being run. The Knicks tried to trade both players at several points in the season and agreed to buy them out to get them out of the locker room and off the team. They have opted to replace them with forward Earl Clark and guard Shannon Brown, both of whom may have a chance to earn minutes or at least be content with being on the team, something neither World Peace nor Udrih were willing to accept.

»In Related: The Complete List Of Salary Cap Exceptions

Money To Be Saved

In the case of Granger and Butler, both are being asked to leave a sizable amount of money on the table in exchange for their release. What’s typically being asked is for the player to leave the amount of money another team is likely to sign them for once they clear waivers. This is a straight business transaction.

Granger has some $4.04 million remaining on his deal. The 76ers will owe him that whether he plays a minute of basketball for them or not. From Philly’s chair, this is a straight expense. They owe $4.04 million. Will Granger save them $1 million to be free? How about $2 million? The Sixers were significantly under the required minimum salary “floor” defined in the Collective Bargaining Agreement. Had they not done the Granger deal with the Indiana Pacers, they would have had to write a check to their existing roster players for the balance. So again, this was an expense the 76ers were paying. How much will Granger reduce that expense to be free? That’s what’s being negotiated. The 76ers are more than happy to let Granger’s contract run out and eat the cost. They had agreed and planned for that when they traded for him.

In Butler’s case, cost is a factor especially for a Bucks team that tends to be on the low side of the revenue pool, but his is more of a combination of respect for the situation Milwaukee finds itself in and the chance to trim a little money off the bill.

So while Granger and Butler are being asked to leave some cash on the table, in Philadelphia this is strictly a business move to reduce outgoing cost.

Open Up Some Roster Spots

The Milwaukee Bucks, Orlando Magic, Sacramento Kings and even the New York Knicks all opted to buy out players to open up roster spots. They wanted to have the ability to either bring in new players that were sitting in the free agent pool or have the ability to add development players for an extended look or players that get released via other buyouts.

Orlando has already filled its two open spots with development players, while the Knicks have filled their two open spots with different veterans. The Kings are expected to replace guard  Jimmer Fredette once they finalize his buyout today and started working out players a few days ago. They seem close to a deal with recently released guard Orlando Johnson.

Not Everyone Wants To Play Ball

There are a few teams holding on to players that are clearly “buyout” candidates. The Utah Jazz have a couple of veterans in forwards Richard Jefferson and Marvin Williams who are prime buyout candidates. While both players were surely approached about gaining their release from the 20-37 Jazz, it seems neither the player nor the team were seriously willing to engage in the quid pro quo required to gain their release. The Jazz didn’t necessarily need the roster spots and the players are unwilling to leave cash on the table. That could always change, but as of today those players seem like they are staying where they are. In Williams’ case he told Basketball Insiders recently that he really liked Utah, his family had settled in nicely and he hopes to be part of the future of the team. That’s likely one of the reasons the Jazz turned down a few trade scenarios with Williams that could have netted them a draft pick.

Some teams are reluctant out of principal to pay players to leave a team, so not everyone is willing to play ball on buying out a player.

»In Related: The History of NBA Trades

What Free Agents Look For?:  The New York Knicks’ season continues to slip away from them, having lost three straight games and eight of their last 10. More and more focus is being put on what forward Carmelo Anthony may do in his expected free agency in July. Minnesota Timberwolves forward Kevin Love is not that far behind Anthony with his free agency set for July of 2015, and Oklahoma City Thunder star Kevin Durant is the next one after that in July of 2016.

In talking with a number of NBA players that are either looking at free agency soon or have gone through free agency recently, there are a few things players tend to focus on in making their decision:

»In Related: Could Carmelo Choose The Rockets Or The HEAT?

Money Matters

There is a great movie line that goes something like this – anyone who says money doesn’t matter usually doesn’t have any. NBA players care about money. Money to players is more than the zeroes in their bank account. It is status, it is security and it is a validation of who they are in the grand scheme of things.

Players receiving a max contract are hard to trade. Players receiving a max contract are almost always starters. Players receiving a max contract are generally considered the team’s franchise player. Whether a player is truly “worth” a max deal is irrelevant compared to what a max contract says about a player.

Players who take the NBA minimum or sign for a low-dollar deal are far easier to trade. They are far easier to bench. There is less status with less money. Why are some guys sitting at home on the sofa instead of playing the role of an eighth man? Because it’s really hard to shake the minimum contract label after you have taken it.

Anthony doesn’t need another dollar in his bank account for his family to be secure for their rest of their lives; he’s already earned more than $135 million in his 11 NBA seasons. His next deal will be worth $100 million or more, not because Anthony needs the cash, but because he covets what the cash says about him as a player in the NBA and where he is at in his career.

Could Los Angeles Lakers guard Kobe Bryant have taken less than the two years and $48 million he agreed to early in the season? Sure. Bryant has earned more than $279 million in his playing career. He didn’t need the money, but if you go back and look how his deal was characterized when announced, it was said the deal kept Bryant as the highest paid player in the NBA. That’s a status players covet almost more than the cash associated with it.

Money matters. No matter how frequently players talk about taking less to win, it almost never happens that way because the money means more in the grand scheme of a player’s image than the actual cash in the deal.

It’s the Future Not the Past

Nervous Knicks fans wonder how the current struggles and dysfunction are going to impact Anthony’s decision. Wolves fans are in the same place with Love.

The truth of the situation is that players don’t tend to look at the past as much as the future. What will tomorrow look like? When the money becomes equal, how the team will be structured, the role the player will play and the prospects of a brighter future tend to trump things that may have happened in the past.

It’s naive to think the past doesn’t matter at all, because it does, especially if the team is preaching a “stay the course” message.

The Lakers lost Dwight Howard because he could not see a brighter future in L.A. for a number of reasons. And seeing how this season has played out for him in Houston versus how things have crumbled apart in Los Angeles with all the injuries, Howard was clearly right for his own personal goals. Now next year and the year after are a different story for the Lakers, but asking a guy to wait two years until you can right the ship is a scary proposition, especially for players with a limited shelf life.

The Knicks will face this same dilemma with Anthony. They won’t have the ability to reshape the team this summer in a significant way, their message is going to be “wait until 2015” and that’s going to be a hard sell for Anthony, who will turn 30 this summer.

»In Related: The New York Knicks Team Salary Page

A franchise’s history of rebuilding and making good decisions weighs heavily into the process. There are some teams that just never seem to make bad decisions and there are other teams that can’t seem to get the decisions right. When charting who offers the best future, which is really what a new contract is about, understanding who has proven they can do it matters, especially once the money becomes equal or near equal.

In Howard’s case, he was making $20.513 million this year regardless of where he signed. He believed that Houston could make it happen faster than Los Angeles, and with the Lakers sitting at 19-38 and the worst record in the West compared to Houston’s 39-18 record, Howard got what he wanted: the chance to win this year.

The fear for New York is that another team gets to the table with a more proven track record than the Knicks and is willing to meet the $22.5 million asking price. That’s when a brighter future faster may trump what the Knicks can offer.

Can I Be Happy Here?

Having talked to a number of free agents about their decision to leave a team that seemed ideal, a recurring theme surfaces a lot: wanting to be happy.

When the money becomes equal, being in a situation where you can truly enjoy the fruits of your career matters. Being around players you know and are comfortable with matters and being around an organization that you feel a connection with matters. This is where the Knicks win the Anthony debate. He loves playing in New York and the Knicks have very wisely coddled him and involved him in all their major decisions.

Like most people who look at new jobs, where the job is located and the lifestyle that you can have in a particular market matter. Who your co-workers are and the relationships you have with management matter.

Jarrett Jack left a great situation in Golden State not just because of the money, but because of the connection he had to head coach Mike Brown. Now that situation hasn’t panned out like either expected, but Jack had options elsewhere and chose Cleveland because he thought he’d be comfortable there.

Jason Maxiell chose Orlando, mainly because of his long history with Magic assistant general manager Scott Perry and felt he could trust the situation in Orlando.

At the end of the day when the money becomes equal, believing you can be happy somewhere matters. Having a bunch of money and being miserable every day tends to be counterproductive; that’s one of the reasons Howard left the Lakers.

So as the days on the calendar tick away, and free agency becomes more and more of the focus, especially for the Knicks, understanding that when players sit down to talk about the future, there is more than zeroes being considered in the equation and for each player what’s most important to them is uniquely different.

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Steve Kyler is the Editor and Publisher of Basketball Insiders and has covered the NBA and basketball for the last 17 seasons.

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