The NBA faced a number of challenges throughout the 2019-20 season. Between the China controversy last October, the impact of COVID-19, and the social justice demonstrations happening across the world, basketball ratings took a major hit, with reports indicating an almost 50% drop in viewership this season.
With the financial implications of the ratings drop, the salary cap for teams will also dip, and could fall as much as $12 million, according to Connor Letourneau of the San Francisco Chronicle.
League sources have put the decline in the cap at anywhere between $3 million and $12 million. If the cap dropped $10 million, the Warriors could have to pay $15 million more in taxes than on an entire roster expected to be in the $180 million range.
Obviously, this not only limits the flexibility of teams, it also limits the amount of money free agents will get offered in the offseason. Players might elect to opt-in to their current deals to wait for a better financial field.
The cap difference could also impact which teams are paying the luxury tax or not, and we could see multiple trades ensue by franchises who are trying to avoid going over the limit.
Either way, it will be interesting to see the fallout from the salary cap drop and how teams maneuver their way through an important offseason.