The tweet that threatened to derail NBA’s decades-long relationship with China, its most lucrative overseas market
NBA (National Basketball Association)

Hours before tip-off on October 10 in Shanghai, it was still unclear if an exhibition game, featuring some of the top players of the National Basketball Association (NBA), would happen at all, following days of uproar that reverberated across the globe – the league drawn into a bitter feud over an event that doesn’t even appear on its calendar: five months of street protests in Hong Kong, and one of the city’s worst political crises.

The ensuing controversy led to a difficult week of cancelled fan events, angry sponsors, online calls for boycotts and a television blackout in the league’s most important market outside the United States. Banners and other signs promoting the game were stripped from Shanghai’s streets days before the match-up.

It wasn’t supposed to be this way. NBA preseason games in Shanghai and Shenzhen – practice matches outside the season that don’t affect teams’ league standings – had taken months of rigorous planning as part of a carefully orchestrated showcase for the league, its biggest star LeBron James, and its US$4 billion franchise in China.

NBA boss Adam Silver says Chinese government asked him to fire Houston Rockets' Daryl Morey

Instead, in an October 4 tweet that has since been deleted, Daryl Morey, the general manager of the Houston Rockets – the former team of China’s most famous basketball star, Yao Ming – voiced his support for Hong Kong’s protesters with a simple tweet of an image emblazoned with the phrase “Fight For Freedom, Stand With Hong Kong”.

The split-second it took for Morey to tap the tweet icon has left the league’s meticulously cultivated reputation bruised in China, a basketball-loving nation since the Washington Bullets became the first NBA team to play there, in 1979. The feud also left home fans angry in the US, where the league has received harsh criticism from politicians and fans over its response to pressure from Beijing.

“We’re not talking about a couple of Yao Ming jerseys being sold in China,” Warren Zola, a Boston College professor and sports business expert, told The Guardian. “We’re talking about billions of dollars coming in.

“This is an enormous tipping point for the league. They’ve targeted China as a market for the short and long term. And it has come to fruition. But then you have their social activism stance. The NBA and [its commissioner] Adam Silver have been incredibly supportive of their players and employees being vocal. So you have this tension – money versus the rights given to people here in the United States in the Constitution. It’s a huge conflict.”

The firestorm over the NBA also highlights the pitfalls that foreign companies face as they try to navigate the norms of doing business in China – including a public and government quick to react to any slight that challenges the nation’s standing on the world stage.

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High-end down-jacket maker Canada Goose delayed the opening of its first China flagship store in December amid growing tension between the two countries over the arrest of Meng Wanzhou, the chief financial officer of Chinese tech giant Huawei Technologies.
Dolce & Gabbana was forced to cancel its Shanghai fashion show last year after a controversial advertisement by the Italian house and an Instagram post by designer Stefano Gabbana that insulted Chinese consumers.

Luxury clothing brands Coach, Givenchy and Versace were all forced to apologise in August for referring to Hong Kong, Macau or Taiwan as not being part of China on T-shirts and clothes. Foreign airlines including Air Canada, British Airways and Lufthansa last year began referring to Taiwan, the self-ruled island that Beijing considers Chinese territory, as part of China on their websites after a demand from Beijing.

Basketball fans protest at the Southorn Playground in Wan Chai in support of Daryl Morey, general manager of Houston Rockets on October 15. Morey sparked a row between the NBA and Beijing earlier over his Twitter post in support of anti-government protesters in Hong Kong. Photo: Sam Tsang
The protests and unrest in Hong Kong began over a controversial extradition bill that would have made it easier to send criminal suspects to the mainland for trial, but have evolved into a broader debate about income inequality, affordable housing and the growing influence of China over the city despite the “one country, two systems” principle.

Businesses affiliated with the mainland, such as the currency issuer Bank of China (Hong Kong), have been subjected to vandalism by radical protesters.

The protests, marked by increasingly violent clashes with police in recent weeks, also drew support from a number of American politicians, culminating in the US House of Representatives’ passing a bill last week that could open the door to sanctions against individuals deemed to have taken action to undermine the city’s autonomy.

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Soon after Morey’s now-infamous tweet, the Rockets’ owner, American businessman Tilman Fertitta, began to distance the team from Morey’s position, tweeting: “Listen …@dmorey does not speak for the @HoustonRockets”.

James Harden, one of the Rockets’ star players, also apologised on behalf of the team. In a statement, the NBA said the views expressed by Morey had “deeply offended many of our friends and fans in China, which is regrettable”.

It was a difficult position to be in for a league that itself has weighed in on social issues in the US and has allowed its star players to act as advocates on social and political issues at home.

Silver – who oversees the 30-team league – came to the defence of Morey and his right to express his opinion, saying, “I think as a values-based organisation that I want to make it clear […] that Daryl Morey is supported in terms of his ability to exercise his freedom of expression.”

Morey posted a conciliatory tweet two days after the first: “I did not intend my tweet to cause any offence to Rockets fans and friends of mine in China.”

But the damage had been done.

The Chinese Basketball Association (CBA), sportswear producer Li-Ning and team sponsor Shanghai Pudong Development Bank all announced their withdrawal of support for the Rockets. Tencent Holdings, China’s largest games publisher and dominant social network operator, said it would stop broadcasting the team’s games on its online sports channel, as did the state broadcaster CCTV, which boasts the largest television audience on Earth.

The Rockets stand to lose about US$25 million in sponsorship this season as a result, The New York Times reported on October 12, citing a person with knowledge of the situation.

On October 16, The Wall Street Journal reported that Morey appeared to be the target of a coordinated harassment campaign by accounts supportive of Beijing, his Twitter account flooded with comments that mentioned him more than 16,000 times in the 12 hours following the offending tweet.

Brooklyn Nets Theo Pinson (left) drives against Los Angeles Lakers Danny Green, near a Chinese national flag during a preseason NBA game at the Mercedes-Benz Arena in Shanghai on October 10. Photo: AP

For the NBA, it was a humbling setback, having first struck a deal in the late 1980s to share advertising revenue in return for games being broadcast on CCTV, and having built its China franchise into a business that Forbes magazine valued last year at US$4 billion.

The NBA has surpassed the English Premier League as the most popular league sport in China, according to sports analytics firm Ampere, with broadcasting fees forecast at US$300 million from 2020 to 2025.

Chinese social-network operator Tencent struck a US$1.5 billion, five-year deal in July to stream NBA games. With more than one billion users, the partnership with the NBA began in 2009 and Tencent has been streaming full NBA seasons since 2015.

Alibaba Group Holding, the world’s largest e-commerce platform and owner of the South China Morning Post, expanded its partnership with the NBA in March, streaming NBA highlights and classic games alongside NBA merchandise.

The league, which does not publicly report its revenue in China, estimated that about 800 million people in the mainland watched NBA programming on television, digital media or smartphones last season. It is not uncommon to see people watching the NBA playoffs on their smartphones or tablets as they travel to work and school in the mornings, since a 9pm tip-off on the US east coast is peak commuting time in China.

Los Angeles Lakers forward LeBron James speaking during a media day in El Segundo, California on September 27. Photo: AFP

As the NBA tried to limit damage in East Asia, it also ran into a backlash at home.

Republican Senator Ted Cruz, a fervent China hawk, said on Twitter that “the NBA should be better than this. We should not be willing instruments of Chinese censorship”.

Florida Republican Senator Rick Scott tweeted that the NBA was “kowtowing to Beijing to protect their bottom line” and called Silver’s statement “an absolute joke”.

Several Democratic presidential candidates aired similar views, with Beto O’Rourke responding on Twitter that, “The only thing the NBA should be apologising for is their blatant prioritisation of profits over human rights. What an embarrassment.”

To make matters worse, the controversy comes amid the heightened sensitivity of a year-long trade war between the US and China, with US President Donald Trump placing tariffs on some US$380 billion of Chinese-made goods, as he tries to force Beijing to change trade and industrial policy.

Views of China in the US have grown increasingly negative, with 60 per cent of Americans saying in mid-August that they viewed the country unfavourably, the lowest rating since 2005, according to a Pew Research Centre survey.

As the controversy unfolded, Joseph Tsai, who paid US$2.35 billion in September for full control of the Brooklyn Nets, wrote an open letter on Facebook to explain to American fans the historical context and why Chinese fans reacted so negatively to the Morey tweet.

“What is the problem with people freely expressing their opinion?” wrote Tsai, the Alibaba co-founder and chairman of the Post. “This freedom is an inherent American value and the NBA has been very progressive in allowing players and other constituents a platform to speak out on issues … The problem is, there are certain topics that are third-rail issues in certain countries, societies and communities. Supporting a separatist movement in a Chinese territory is one of those third-rail issues, not only for the Chinese government, but also for all citizens in China.”

As indignation built in China, several fan-focused events were cancelled, including an NBA Cares charity event at a Pudong junior school and open practices for the Lakers and Nets. The NBA later said it was forced to cancel the events at the request of the local government in Shanghai.

On October 9, the day before the Shanghai game, massive banners advertising the contest were stripped from the Super Brand Mall, in Lujiazui, steps away from the teams’ hotel, while a press conference with Lakers and Nets players was abruptly cancelled. Crews dismantled a fan court and accompanying stands outside the arena that day. Several mainland celebrities, including the actor Wu Jinyan and singer Fan Chengcheng, said they would boycott NBA events that week.

On the afternoon of October 10, the NBA’s official account on Weibo – China’s pseudo-Twitter – posted a clip of the two teams warming up. A cautious but collective sigh of relief resounded across the internet and the spectacle proceeded as planned at the 18,000-seat Mercedes-Benz Arena under heavy security, with Chinese fans handing out tiny national flags ahead of the game.

“I love China more than my own life,” said Lakers fan Wang Qingshan, noting he would chose the government over basketball. “I would die for my country.”

James, who scored 20 points in his team’s losing effort, received the biggest ovations of the night while Silver did not attend the game.

Houston Rockets general manager Daryl Morey, during a Houston news conference in 2011. Photo: AP

Two days later, the Lakers and the Nets tipped off in southern China’s technology metropolis of Shenzhen, just 15 minutes by rail across the border from Hong Kong. Security guards confiscated umbrellas – a symbol of support for anti-government protests in the Special Administrative Region – despite a forecast of rain. (Umbrellas are not on the list of prohibited items at NBA arenas, unlike tripods, selfie sticks and poles, which are banned by the league.)

Tencent and CCTV did not broadcast the exhibition matches in China, but the former has resumed live broadcasts of other NBA exhibition contests. It has also offered a refund to subscribers who chose the Rockets as their preferred team. The NBA, however, has not been able to wriggle free.

James told American media outlets on October 14 that he did not believe Morey was “educated on the situation” in Hong Kong before he made his controversial tweet, which prompted protesters in Hong Kong, where the league is also popular, to throw basketballs at a photo of James and burn his jerseys at a rally at Southorn Playground in Wan Chai. James, who won NBA titles with the Miami Heat and the Cleveland Cavaliers, also faced a backlash at home over his comments.

“I won’t talk about it again,” he said at a media session the following day, according to Reuters, “because I’ll be cheating my teammates by continuing to harp on something that won’t benefit us.”

Additional reporting by Mandy Zuo in Shanghai, Laurie Chen and Ryan Swift in Hong Kong.

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