Free Agency: Risk & Reward
BG gambled and won, but not everyone is so lucky.
by Nima Zarrabi
Free agency can be a bitch.
Money moves quickly when July 1 hits and players who are prepared and realistic usually get what they want, in some cases, more. Players who miscalculate the market or their worth, pay dearly.
Ben Gordon signing in Detroit didn’t shock me—he solidified his future earnings with another solid season and an impressive playoff performance against the Celtics while playing hurt. What impressed me was the fact that he proved his point and he did so by banking on himself. If the reports are accurate, Gordon will ink a five-year deal worth between $55 and $60 million. He reportedly turned down a five-year, $50 million deal from the Bulls last summer.
Some thought he was crazy for leaving a guaranteed $50 mil on the table, opting instead to sign a one-year qualifying offer the Bulls had extended to retain his rights. In some instances—particularly with baseball agent Scott Boras—fans blame agents for persuading players to be disloyal and bolt town for a new team and more money. Agents have great influence over their clients—no doubt. But in the end, it is the player who makes the final decision given all the information and facts. Bottom line.
I’m not sure who Ben Gordon’s agent was last summer—I believe he has changed agents a few times since entering the League. Whoever it was, let’s say he charged Gordon a four percent fee, the maximum an agent is allowed to charge per the NBA collective bargaining agreement. If that’s the case, Ben Gordon turning down $50 million, means the agent was leaving a guaranteed commission of $2 million on the table ($400,000 per year over five years). Isn’t it in the best interest of the agent to get a deal done? Gordon’s agent certainly wanted to go for the maximum amount possible.
But there are huge risks in passing on that kind of coin. The main risk being that you cannot come back to the negotiating table until the following summer. A lot can happen in a year. A player can become disgruntled and fire the agent for someone else—what that agent once thought was a future $2 million in commish quickly becomes zero. A player can get hurt or even have a terrible season, severely depreciating their value. The point is that there are huge risks in passing on deals, both for players and their representatives.
In the end, Ben Gordon had a number in mind and Chicago didn’t come up with it. It is very likely that the decision was more than just money—Gordon has been unhappy and felt disrespected for quite some time and may have simply wanted a change of atmosphere as well. However you dice it up, he took the risk of passing on an extension last summer and ended up making more money. He will get another bite at free agency at the age of 31, and if he continues to progress and stay healthy, he might score another nice payday.
It will be interesting to see what kind of money the remaining free agents can pull. The name of the game is comps and the Gordon and Charlie Villanueva deals help set the marketplace. Trevor Ariza’s agent now has a ceiling thanks to the Villanueva deal and we will see how the Gordon deal impacts the market. I wouldn’t be surprised if Mike Bibby and Jason Kidd are asking for $10 million per year.
In a summer that was filled with player options, I think we have seen some very intelligent decisions made by players and their representatives. Carlos Boozer ($12.6 million), Jamal Crawford ($9.3 million), Mehmet Okur ($9 million), Kyle Korver ($5.2 million) and Eddie House ($2.9 million) made smart decisions by deciding not to opt out. We’ll see if Anderson Varejao’s ($6.2 million) decision to opt out is a wise one.
Thinking back on recent free agency periods, four severe miscalculations come to mind. In 2004, Latrell Sprewell turned down a three-year, $21 million offer from the Timberwolves. Insulted by the offer, Spree waited on the market for teams to come calling. That didn’t happen and Spree never played another NBA game. In 2008, it was reported that Sprewell’s Milwaukee home had gone into foreclosure and a yacht he owned was auctioned off after he failed to make the mortgage payments.
Next up, Vladimir Radmanovich’s decision to pass on the Sonics six-year, $42 million offer in the summer of 2005. I believe he and his agent were holding out for $47 million. After passing on the extension, Radmanovich signed his one-year qualifying offer and was traded later that season to the Clippers. He became an unrestricted free agent in the summer of 2006 and ended up signing with the Lakers for five years at $31 million.
That same summer, we witnessed the brilliance of Bonzi Wells. After a solid season in Sacramento, Wells turned down a reported five-year, $38.5 million deal from the Kings. Soon enough, the market dried up and he was forced to settle for a two-year, $5 million deal with the Rockets. He now plays in China.
And finally, little Earl Boykins. During the 2007 free agency period, Boykins opted out of the final year of his contract with the Bucks, bypassing a $3 million guarantee. Boykins found no takers on the market and ended up signing with the Bobcats halfway through the season, for the minimum. Last I heard, he was playing in Italy.