With the NBA Draft 2008 approaching, I was wondering if it’s still a dream to be drafted by a NBA team. The decline of the US dollar and the financial improvement of top European clubs has reduced the gap between NBA franchises and the top teams of The Continent.
To start with, you have to know that the NBA fixes the salaries of NBA rookies, the result of some huge amounts paid over long periods to rookies (recall Glenn Robinson) before they ever played a game in the big league. So today, every player drafted in the first round has a guaranteed contract for two seasons and three optional seasons.
For example, the player drafted at No. 1 this year knows that he will earn $8.339 million in his first two seasons combined. Even with an exchange rate of €1 to $1.50, this is still a large amount in Euros. But this salary is gross, so the player has to pay 29% tax on the amount; so he will only earn $5.920 million USD, about €4 million, in two years.
If you go to the middle of the first round, the guaranteed salary for a player drafted 15th in the first two seasons combined will be about $2 million net. This is €1.3 million in two years, so about €650,000 per season. Guaranteed. This is a salary that good European players are paid in Europe.
So for a 22-year-old Euroleague player with NBA potential, this is not really a big deal and he may earn more in Europe. An example of this was the case with Fran Vazquez, who refused an offer from the Orlando Magic to take a better contract in Spain.
When we go to the final spot in the first round, the last spot that gets a guaranteed contract, the salary is even lower. The 30th spot is worth $1.6 million in two years which corresponds to approximately €400.000 net. This is already a common salary for a Euroleague player. If you go after rumors of what certain players are getting paid in Russia, Greece or Spain, 400K is nothing.
So after all this, is it still worth it for a European player to get drafted at all? Of course, if you go to the Top 10-15, you can earn a contract that is probably higher than what you can get in Europe. Below this, I have some doubts.
Can we say that there is already a trend for fewer Europeans to be drafted because of this? Maybe. At least the names that you see in the last spots of the first round will no longer be top European players like Tiago Splitter, for example (I hope so for every NBA franchise). These guys will never come to the NBA for the maximum salary that they can get there, as any European club can offer more.
Another solution is to be drafted in the 2nd round or not at all and only join the NBA at a later age. This gives players the opportunity to land a contract more in line with the real skills and salary expectations, as the rules are less restricted for these players.
However, for mid- to low-first round US players, checking what the market can offer them in Europe may be worth it. This phenomenon may become reality for some collegiate players with a European background this season: Kosta Koufos or Pat Calathes are rumored to have already received professional offers from Europe which will probably be higher than any NBA team can offer them according to current rules. Will other US-born first-round picks follow them? Will the agents recognize this situation in the future?
Of course, this has been a possibility since the decline in the US dollar makes European salaries more and more attractive. So will we ever see a No. 1 pick refuse its NBA offer to move to Europe? And when will European teams recruit American high school players for their own (paid) youth programs and challenge the NCAA?
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