business in women’s basketball

[From Guest Writer #6 in our annual summer series…]

$10,000,000… That’s the annual losses of the Women’s National Basketball Association. In fact, the WNBA has never turned a profit since their inception. Admittedly, in a country filled with a diversity of opinions, this issue tends to turn political, with pundits arguing over the legitimacy of the league and women’s basketball. What we tend to avoid is talking about the WNBA as a business and their ability to provide sustainable value to their customers. That’s the goal for today.

First off, I think it’s important to note that the WNBA represents a noble cause. Sports have been traditionally dominated by men, and the WNBA is offering women the same opportunity. The problem, however, is that they’re not doing it very well. Their losses are expected to increase, with the WNBA and its teams expected to lose $50,000,000 in 2024. A major factor in this is the WNBA’s relationship with the National Basketball Association. The NBA owns about 60% of the league, and receives about 40% of revenues from the WNBA, while outside investors also get a cut. This model is not one that sets up the organization for success.

The league has also fallen victim to many political pressures over the years. For instance, players in the WNBA versus those in the NBA make a strikingly different income. The average WNBA player makes around $100,000, with the NBA average being approximately $10,000,000. Just recently, WNBA players have started taking charter flights, though this has not been the norm. WNBA teams and their players have typically flown commercially for their travel needs. All in all, many have scrutinized the WNBA’s treatment of their players, as the players seem more like employees than celebrities. 

Supporters of the league often attribute the league’s lack of company success to the presence of misogyny in American sports. There is little doubt this exists, but this claim does little to actually solve the issue. Any political discussion of the WNBA tends to start with a comparison of such to the NBA, in that there is little difference between the two. For instance, Caitlin Clark, one of the league’s brightest stars, has been heralded as the next Steph Curry, a legend in the NBA. In actuality, Caitlin Clark isn’t the next Steph Curry; she’s the first of her kind. More broadly, the WNBA is not the same as the NBA, but that does not make it inferior. There are beautiful parts of each sport that do not need to be compared, but that can be celebrated individually. If the WNBA was presented like this, it could work to decrease misogyny as a barrier to the league’s popularity.

The good news for the WNBA is that league viewership is increasing. Clark, along with an influx of new talent in the WNBA, has seen the league reach record viewership. This gives the league more leverage in their negotiation of television contracts. These currently sit at around $60 million, but it is expected that these deals will at least double (if not triple) in value in 2025. The league is also adding expansion teams in the coming years, which will pay record high expansion fees to join the league.

With an influx of revenue on the horizon, it seems the WNBA could be on its way to turning a profit. But why should that belief be strong? Executives in the WNBA (and in the NBA, given their stake in the league) have not proven they can make the league a success. These individuals undoubtedly have had a chaotic environment when trying to achieve such. However, business leaders are not spurred to blame their environment for their success or lack thereof. A business leader must capitalize on their ability to drive success within their organization. For the past 28 years, the WNBA and its investors appear to have accepted their poor financial results. That acceptance will not last forever, and it is time the WNBA starts being a catalyst for women’s athletes. The question is, are they really fit to do so?

Amidst this discussion, it is important to point out that profits should not be the first goal of an organization. As the respected author Frederic Laloux puts it, “Profit is like the air we breathe. We need air to live, but we don’t live to breathe.” The WNBA may be in business primarily for the opportunity to expand female opportunities in professional sports. Given females’ historic exclusion from such, that is understandable. However, if they want to continue providing that opportunity, the WNBA must begin to turn a profit. 

With respect,

Serg

[References utilized: https://www.sportspromedia.com/news/wnba-losses-2024-media-rights-deal-cathy-engelbert-adam-silver-caitlin-clark-nba and https://greenlight.com/learning-center/earning/nba-vs-wnba-salary.]