China’s fight with the NBA, explained

China’s fight with the NBA, explained


This is Shaq on The Great Wall of China. Here’s Michael Jordan, There are a lot of these. For years, the NBA has been sending teams to China where more people watch
NBA games than in the United States. The purpose is to play basketball, meet Chinese fans, and have players like Rip Hamilton
spread a clear message. The NBA has worked hard to build a successful business in China, but then they almost
lost it all because of a single tweet. It was March of 2000 and President Clinton
was pushing for a trade deal with China, despite concerns about China’s human rights record. “It does deny its citizens fundamental rights
of free speech and religious expression. It does define its interest in the world in sometimes
in ways that are dramatically at odds from our own. Just a decade before, China’s government
put down an uprising at Tiananmen Square. “…human rights not trade!” And in 1999, Americans also had concerns
about China’s record in Taiwan and Tibet. “The Fortune 500 companies are controlling
the American foreign policy in China. This is wrong. It’s gotta stop. President Clinton, we are asking you
to take a courageous position.” But Clinton insisted that doing business with China would have
a positive impact on their human rights platform. “The question is not whether we approve or
disapprove of China’s practices. The question is: What is the smartest thing
to do to improve these practices?” Bill Clinton came to think that engagement,
that trade, that direct contact would have a positive impact on the human rights situation
in China, as well as improving the overall U.S. China relationship. The next year, China joined the WTO. 2001 is important because that’s when the
country enters into the World Trade Organization, which greatly simplifies doing business, not
just with the United States, but with the entire world. The Chinese economy was about to take off. US businesses began investing in China and eventually Chinese companies
would start investing back in the US. As China became richer, as China became more
integrated into the global economy, it became a more important market
for the United States. After 2001, the average Chinese person had
more disposable income as a result of the rapid growth. It was the perfect moment for the NBA to build a business in China and it all started right here. “With the first pick in the 2002 NBA Draft, the Houston Rockets select Yao Ming from Shanghai, China!” At the time Yao Ming was 21-years old, watching
the NBA draft on a laptop in China. “Can you fully comprehend, for yourself,
for Chinese Basketball, and for the NBA, what it means to be the NBA’s number one overall pick?” Yao was the NBA’s “next big thing” for fans in China, where basketball has been popular ever since
it was introduced by missionaries in the 19th century. When the Communist Party came to power they
banned most Western sports, but basketball was embraced as a national passion. But China never produced a star player… until Yao. “…Yao Ming and company, ready to go…” Now they could watch a Chinese player playing
at the same level of these legendary greats and playing Shaq 200 million Chinese viewers tuned in for his
first game against Shaq and The Lakers. “They’re watching live in Shanghai at
10:30 in the morning as O’Neal goes right at Ming!” Compare that to 9.9 million: the average number
of Americans that watched the NBA Finals that year. “Yao, first touch, for two!” Yao became a household name in China and soon
American companies turned to him for endorsements. “Can Jimmy play? Hi Yao! Jimmy?” “Get a Garmin” “…the new 17-inch powerbook.” Yao’s popularity also helped the NBA develop
their fanbase there. In 2004 The NBA started sending teams on an
annual summer tour of China, where the Houston Rockets became a fan favorite, simply because that was Yao’s team. The tours brought the biggest NBA players
to China and boosted the league’s popularity. For comparison, The NBA
has slightly more Twitter followers than the the next
major sports league in The United States. But in China, the NBA dominates social media
platforms like Weibo. Nearly 500 million people watched NBA games
last year using Tencent, China’s largest streaming platform. That’s more than the entire population of
the United States. In 2019 Tencent and The NBA signed
a deal worth $1.5 billion dollars, almost three times what it was worth five years ago. The people who manage the NBA recognized that
there were tremendous opportunities in China and they worked hard to develop that market
and they have succeeded. Then seven words threatened everything. Daryl Morey is the general manager
of the Houston Rockets and his tweet repeated a phrase
chanted by protesters in Hong Kong. Well this is just about civil liberties, this
is about having a voice in government. What’s wrong with that? And so he thought nothing of tweeting this out,
whereas in China, it was perceived quite differently. It was seen as an effort to break up China,
an effort to weaken China. The Chinese Consulate in Houston
responded by saying they were “deeply shocked by the erroneous comments on Hong Kong”
and asked the Rockets to “correct the error”. Daryl Morey took down his tweet and The Rockets tried to do damage control. “Yeah, We apologize, you know, we love China. We love playing there.” Despite the apology, the government cancelled
NBA broadcasts on Chinese state TV. “CCTV’s sports channel has just announced
that it will suspend the broadcast of any NBA games in China,
including this week’s preseason games.” Tencent also suspended broadcasts
of Houston Rockets games. In Shanghai, workers were tearing down advertisements
for upcoming games And fans protested outside the stadium where
teams were set to play. On social media, a fan posted this video of
himself tearing up tickets to the game in support for the Chinese government. The NBA Commissioner stood behind
Morey at a press conference. “The long held values of the NBA are to
support freedom of expression and, in this case, Daryl Morey, as the general manager
of the Houston Rockets, enjoys that right.” But the league undercut their message when journalists were stopped from asking
about the incident afterwards. “I just wonder after the events of this
week and the fallout we’ve seen, whether you would both feel differently about speaking
out in that way in the future?” Foreign businesses in China, have long recognized
that there are red lines that must not be crossed. And traditionally those have been the three
Ts: Taiwan, Tibet, Tiananmen. Three political issues the Chinese government
tries to control messaging around. Companies have learned that if you cross one
of these lines, there is a price to pay. For example, in 2018 Gap was selling this
t-shirt featuring a map of China without Taiwan. After a photo of the shirt was posted online,
Gap apologized and promised to stop selling the “incomplete” t-shirt in a statement
released by People’s Daily: a government newspaper. You’re talking about a one party state that has
the ability to let you in, to expel you, to make you rich. By withholding access to consumers,
China forces foreign companies to apologize and/or change their message
in order to continue selling products. Because China has a population of 1.4 billion,
that usually works. The NBA learned that doing business in China
means playing by their rules and that’s not what US leaders like President Clinton
had envisioned. The hope was that trade with China would open
it up to ideas of democracy and free speech, while making American companies
money at the same time. But as American companies changed their messages
to sell products in China, the risk became importing Chinese censorship.

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