Atlanta Hawks: Michael Gearon Jr. Q-and-A

Hawks co-owner Michael Gearon Jr. sat down Friday for a long interview with myself and fellow AJC scribe Tim Tucker. Here are some excerpts from the wide-ranging discussion, edited for clarity and flow. It includes my interrogatives and/or explanations of what Gearon was talking about:

Gearon started out by explaining his reasoning on bringing back most of the same players for what he says is a “make or break” year for the Hawks.

I look at us, and you measure a team on its results: How are we doing vs. the league? There are three teams the last three years that have advanced past the first round. The Lakers—who everybody loves the Lakers—the Celtics and the Atlanta Hawks. It’s not the Dallas Mavericks, it’s not the Miami Heat, it’s not the New York Knicks, it’s not the Oklahoma City Thunder, it’s not the Orlando Magic. It’s just those three. Have we been able to win a championship? No. But our goal is to be as competitive and entertaining as possible and it’s unrealistic to every year have the only measure of your success as winning a championship because one in 30 do it. So you keep getting better and competing each year in order to try to complete for that championship.

Now last year if, we had lost in the first round or gotten blown out in the second round, our roster would look like a lot different because we would say, ‘You know what? Time to make a change, let’s blow this up.’ Instead, we’ve got a core group that each year keeps chipping away and getting better. They are still pretty darn young when you look at that core. . . .

One thing nobody has really given us credit for is last year the Atlanta Hawks had the most competitive [second-round] series than they’ve had in 18 years. Our big trade in February that got us past the first round—I would say [Kirk Hinrich's] defense on Jameer Nelson was a difference-maker and also the way we played [Dwight] Howard. Hinrich was out that second round [and], on the positive, we got to see Jeff Teague go against the best point guard in the NBA. And he played at an elite level against that player. He shot just as well from the field. Averaged–before that last game where he hurt his wrist–averaged 17 points per game he was controlling the ball, he was protecting the ball, and as a result were able to compete with Chicago where most people thought we would be swept.

So going into this season, we still keep getting better because of the playoff success we had last year.
What’s frustrating, from a fan perspective, is that you would look at Atlanta in this market. . . . Tim, you understand the risk we took to get Joe and the reward we got. Unfortunately I think some of that message got lost publicly and how we’ve been viewed [negatively] regardless of the success we had. And I look at things where people say, ‘Oh, well, the Hawks owners are cheap.’ That’s something I hear constantly whether it’s written or radio guys. Yet when you look at the facts . . . This year we will probably have one of the top 5 payrolls in the NBA. It will be right around $70 [million], I will tell you if we are at the trade deadline and we feel like we are missing that piece, that we will think will take us over the top, [we will pay the tax]. . . .

You look at the Hawks, if you look at our payroll vs. the Falcons—I don’t want to crap on the Falcons in the paper but everybody acts like Falcons do whatever it takes to win—their payroll the last three, four years as been in the lower third in the league. They were 25th in 08-09, 26th in 09-10, 26th in 2010-11. Now let’s contrast that with us. 2010-11 we were ninth; 2009-10 we were 21st. This year we will probably be fifth. What I struggle with is when the facts don’t support the [negative] view. . . . You and I, we need the Hawks to have the same energy and perception in the public the Falcons do in order to have more bloggers, more viewers. I look at the Falcons, they’ve got 1,500 people [commenting on AJC blogs]. The image of that team has been shaped as, they will do whatever it takes to be successful. Now contrast their success to ours. The last playoff game they won was in’04. That’s just a fact. Michael Vick was still on the team then. We’ve won in the playoffs three years in a row. I hope the Falcons make the playoffs this year and I hope they win the Super Bowl because I’m in Atlantan and I’m a huge fan of every team here. They’ve never made the playoffs three years in a row. You would think every decision they make is just a bright decision based on how it’s portrayed. We get criticized because the bar is the tax instead of the cap. I don’t think our fans understand, we do spend money and we are one of the highest payrolls.

I told Gearon I think sophisticated fans know that the owners spend money but they take issue with how those resources are allocated.

And I can handle that. I love that. I want a buzz. I want a pulse. And I’m thick-skinned enough . . . come at me. I’m not a person that has a problem accepting criticism. The issues for me is being sure the reader or the fan knows both sides. The passionate [basketball] fan, we have. It’s trying to get the interest of the casual fan that doesn’t know us and believes, ‘They really don’t spend money and they are not successful.’ The problem is I have with that, those two statements, compared to the other teams in the city, are factually incorrect. The last six or seven years, by our record, we are the most successful team in Atlanta. I used to tell people, with the Thrashers, bring [the criticism] on. The Thrashers have sucked. I’m not here to defend that. I am a basketball guy. I will tell you as an investor I loved the Atlanta Thrashers, I busted my tail to do what I could to try to keep them here, I was disappointed they left. I think Tim saw some of the emotions that I lived through, the pain in my own household. . . . As a man, I was the one guy that said I will step up in front of everyone and make whatever statement is necessary even though I’ve never been perceived as the hockey guy.

One of the challenges you have, and I have, we need this team to have a pulse if we are going to grow the fanbase, which hopefully grows your bloggers and your readers and grows our season-ticket holders. The passionate fan is fantastic because they come. What we are trying to do is attract the casual fan who thinks the Braves are more successful, or that their owner cares more. I can tell you with absolute certainty that there is not an owner in professional sports who has been to as many games of the team that they own than I have. Because I’ve been doing it since I was 5, and there is nothing that would bring me greater joy than winning a championship. But what I don’t want to do is blow up the roster and have seven years of failure as you try to get there.

When we bought the team, we were the first NBA team to say we are going to scrap it and build through the draft. We are going to be patient about it and we are going to try to build assets and then trade selectively when we felt like the right piece was there. Ironically, when you look around the league, that’s the Oklahoma City model. That was the Portland model. That was the L.A. Clippers’ model until they did the Chris Paul deal. A lot of teams adopted that thinking that’s the right strategy. Around the league our peers look at us and say, ‘You guys have done a hell of a job running that franchise because you are in a market that’s not a large revenue market, you’ve been competitive, you’ve kept your base players, you’ve been willing to pay Josh Smith 50-something million, Al Horford his $60 million, Joe Johnson his $100 million, Marvin his $40 million and so forth.

With Jamal, I love Jamal, that was one of toughest decisions we faced as an organization. I think if it were the old CBA, we might have looked at it differently. But the biggest challenge we face from a pragmatic standpoint is there are three guys who get the minutes [at guard], and what happens when you have four and how does that work? I hope Jamal kills it in Portland because he’s a great person. We’ve tried over the years . . . with Joe Johnson we could have lost Joe. We could have said, ‘You know what, the other teams that were after him, Chicago, Miami, New York, we will let him go.’ But where would we be? We wouldn’t have gotten anything.

You could have signed-and-traded him and got something in return.

You are right, if you get something of value coming back. A lot of times you get a marginal player. With Joe, I did this last night—it caused me to be up until 2 in the morning, but it was a helpful exercise—Joe Johnson is one of only 10 guys that has made the All-Star game five years in a row. And yet he gets all this huge criticism. And he really does care. You see his conditioning. So many guys get their contracts and they come in [out of shape]. There are a handful of guys in the league who you know no matter what they are making they are going to come nad play as hard as possible. Kobe is that way, LeBron is that way, Wade is that way, Jordan was that way. Joe is that way conditioning-wise [but] Joe’s personality isn’t that way. He’s so quiet. In the seven years I’ve known him I think he has said 50 words to me. And I’ve reached out to him like I have all these guys and said, ‘If there is anything I can help you on, any business advice, let me know.’ But if you look at that collection of guys, the All-Stars over [five] years it’s LeBron James, Dwyane Wade, Kobe Bryant, Kobe Bryant, Dirk Nowitxzki, Amare Stoudemire, Chris Bosh. It’s not Chris Bosh, it’s not Carmelo Anthony, who are great players, but you hear this buzz with those two guys like they are the second coming. But you go back and say what did Denver do with Carmelo Anthony? They made it past the first round once. What did New Orleans do with Chris Paul? Go past the first round once. What did the Hawks do with Joe Johnson? They’ve gotten past the first round three years in a row. Joe deserves some credit for that. Does he a have a big contract? Absolutely. But I think for a fanbase, they should say, ‘I’m glad those owners stepped up to pay him instead of let him go for nothing.’

Joe had what he admits was his worst season after getting that contract. Does he have to play better to justify that contract?

I think what justifies that contract is the success of the team. We had the best playoff success we’ve had in our tenure as owners last year. So I don’t judge Joe Johnson on the regular season. We took away the home-court advantage from the team with the best record during the regular season. I think the way we beat them up caused them to lose to Miami. I really do. For us as an organization we are going to judge our success by how we do in the playoffs. Are we going to be competitive and show up? Fortunately we’ve got all of our core players, and you’ve written some of this, they’ve come in to camp in shape. And I appreciate, as a fan and as an owner, the piece you did on Teague. That was a great piece. It’s right on that if we are going to play well this year, it’s going to be more up-tempo offensively and more lock-down defensively and we are going to look different. And I think that for fans it is going to be more exciting because it’s not going to be pounding the ball.

Are you concerned about what happened during the regular season, when you had a lot of blowout losses? That doesn’t usually happen to good teams.

I think we played well against competitive teams. We played well against Miami. We played well against Orlando. We struggled against Boston. We played well against Chicago. We had a point where we were on pace for the same record 9as 2009-10]. Then once we locked into, the last 10 games, into that fifth seed and it didn’t matter what we did, we went from being from 44-32 to 44-38 because I think we lost our last five or six and that’s what stuck with the team. I think what hurt us with our blowouts was our inability to play defense consistently and we are hoping we can do that this year.

As you can see, if you look at the culture of the team we have right now we are bringing veterans in. When Al Horford is on the court, he sees Tracy McGrady out there ans there is that respect as a veteran. Those pieces that aren’t necessarily the superstars–the DeShawn Stevensons, the Robert Horrys–those sometimes are the ones that make the difference and hit the shot. But they are veterans that are used to that moment and that’s how we try to build our roster this year.

Over the last four years we’ve had no problem with the assets. We moved Shelden Williams and Acie Law for Mike Bibby and got a pretty good point guard. Then we moved Mike Bibby and got Kirk Hinrich, and we moved Acie Law and got Jamal. There are pieces that we’ve been able to move but we’ve done it selectively. Unfortunately Kirk was hurt and we didn’t get to see him for a full season and we won’t get to see him for a full season this year. Our hope is by the time we reach the playoffs he is healthy and our team is clicking.

Gearon on what he says is an unfair perception, fueled by local media, that the Hawks are not successful and the owners don’t spend money.

It’s more of [an AJC] columnist issue. The way it is written is we are cheap, we are bad owners, we do a horrible job and we don’t care. [Tucker] did a piece five or six years ago, he did a father-son piece and he picked my father and I about the bond we had going to [Hawks] games as a kid. Back in the late 70s, 60s they had Picture Day. There I am with Pistol Pete Maravich and Lou Hudson. I think what is tough is, the perception we don’t care is grossly accurate for myself. Because I do care and there is not a day or night that goes by that I’m not miserable when we lose and not high when we win. I’ve also tried not to lose perspective and blow up a roster just for the sake of blowing it up.

For example, last year Orlando had a 10-game stretch where they struggled and blew up their roster. Greatest thing that ever happened to us because they got rid of Gortat, got rid of Pietrus. If you look at the team that blew us out [in the 2010 playoffs], Pietrus was a great defender that can spread the floor, Barnes is a great defender who can spread the floor, Gortat. And they get rid of these guys and you look at what they got back and you kind of scratch their head. . . . We haven’t seen enough to say this team is not capable of competing [for a title]. I say that because there are only three teams out of 30 that have gotten out of that first round three years [in a row]. And they are young. Josh Smith and Marvin are 26-years old, and Teague is 22 and Joe is 30, and Joe plays like Paul Pierce. He’ll play until he’s 36 because Joe is not dependent on his athleticism like a Kobe, like a Dominique, like a Jordan. He’s got a cagey game, he’s got size. I think he’s going to be a good player in his mid-30s. When you blow something up, you want to do it [only] if you can get something better.

So are you willing trade one of your core pieces now to get a superstar?

I am very careful of saying that [publicly] because it does no good. We have a core group that is very competitive. I think they are always trying to get better and there is nothing we’ve seen there that would allow us to get better, and I’m comfortable saying that. You’ve got to be careful. You see the comments coming out of the Lakers [after the Paul-Lamar Odom trade nixed by the league]. It’s a hornets nest right now.

You’ve said in the past there are only a handful of players who are worth paying luxury tax to acquire. Do you still have that view?

I think we would go into it if we felt like it was that one piece that would make a difference. But with the new CBA it makes that extremely challenging, which is why you see some teams like Dallas willing to lose a player to maintain flexibility.

Do you think that’s because of the more punitive tax that takes effect in 2013 or because of the so-called apron of $74 million [after which teams can't use the full mid-level or do sign-and-trades].

I don’t think it’s the tax, because Mark [Cuban] has never had a problem writing a big check. I think it is [the apron]. I think it’s wanting the space so guys will be here. I know some players in the league and I think Atlanta—forget what Kenny Smith or Barkley says on TV—Atlanta is one of the more desirable [cities] for athletes to live. Guys like living here. If you look at so many players who live here, they love the city.

Then why do you think it is that the Hawks don’t make the cut when superstars list the franchises they’d like to join?

I think it’s more the players on those teams being very outspoken and going after it. Stoudemire is an outspoken guy in New York. The Lakers are the Lakers they don’t have to [recruit]. They’ve got the legacy. When you hear players looking at franchises, it’s more players listening to other players.

Former Hawks player Steve Smith says he thinks ownership instability plays a role.

My view—and this gets back to what’s perception vs. reality—you look at stability, there is a lot of stuff written and it’s not supported by fact. We’ve kept all of our core players. We’ve invested in the team, we are willing to have one of the higher payrolls and we are competitive. Steve Smith thinks that because he picks up Jeff Schultz and reads him. What I see in the Internet world, when you look at the last eight or nine years, you will have columnists who write certain things, then it gets picked up nationally, and then all of a sudden that’s just the view.

I think there is a perception among fans that the owners tried to sell the team and now they aren’t committed. What do you say to those fans?

We’ve got our players, and look at our payroll. Going through seven-year legal battle where somebody sues you and it’s over a player that makes your team better. You win. It’s not your fault. Everybody says we sue each other—we got sued. The facts of the matter are, our GM wanted Joe Johnson, we supported that. Our partner didn’t. He didn’t want to spend money, we did, we win. The combination of that and living through [the Thrashers sale] was draining. I think we left three or four days after the press conference and I didn’t come back until mid-August. I think I was in Atlanta for maybe two days. I actually thought that maybe somebody, a new face [as Hawks owner], maybe would be better. I’m very pleased with where things ended up [with the sale].

Are you still trying to sale the team?

No.

Not at all?

No. But who knows whatever happens in any situation. If somebody comes and offers you something you never know but that’s not what my goal is. [Gearon says he no longer has the investment bank that handled that sale on retainer.]

Tucker told Gearon he still seems to be passionate about the Hawks.

I can’t wait until we play. I hope you can tell by the way I’m acting. It’s real hard to build a competitive team. It’s real easy when you are lucky enough to have the draft pick and get one of [top] five guys in the NBA right now. You can surround those five guys with just about anybody and still compete. Case in point is Cleveland. With LeBron they went to the Eastern Conference finals at least two times, never lost in the first round. He’s a difference-maker with the team. . . .

It is tough. [People say] the ownership is messy and this or that and there are so many misperceptions, even looking at how many investors we have. We have fewer investors than most NBA teams in the league. And reality is Bruce [Levenson] and I have managed it the last seven or eight years. That’s exactly what it is in Boston with Steve Pagliuca and Grousbeck . Yet there is nothing negative that is written about that. The way I look at it if we are just starting out and you want to critique that and it doesn’t work, but when you have a body of work that’s been successful or more successful than any team in Atlanta, yet you critique it? Is that fair?

Rick Sund is in the final year of his contract. How do you evaluate his performance? Are you discussing a contract extension with him?

To take a page out of Rick’s book, we won’t discuss extensions with guys until the end of the year. I like the job Rick has done. I like the job Larry [Drew] has done. Larry got us past Orlando. I thought he outcoached [Stan] Van Gundy. I thought he outcoached [Tom] Thibodeau but they had a hell of a team. What people don’t even realize, I don’t think the oddsmakers had us winning one playoff game out of 12 and we beat Orlando and took Chicago to six. I don’t think [the oddsmakers] were right and the record shows they are wrong but that was the perception. That playoff series, and knowing what Teague can do and putting Hinrich in there, I think we win one of those games and the defensive energy overall would be better. That’s not Jamal’s strength.

You said Teague is a key for this team. What else has to go right?

You have to see the continued growth of our young core. Josh has got to continue to improve, Marvin has got to improve, Al has got to improve. Joe is pretty reliable. I respect and like the fact Joe looks at last year and challenges himself. Joe always comes in in great shape. It’s hard to find guys like that. The guy always stays in shape and he’s a pro. That’s why I look at him because this poor kid gets criticized as if he is a failure when you look at it and say, ‘Wait a minute, let’s judge how he’s done.’ Dwyane Wade could not get past the first round without LeBron or Shaq. Joe has done it. And I think Dwyane is an unbelievable player, so I’m not trying to say Joe is better than Wade. But you judge somebody by their success and Joe came here, we were really young and each year we got better in the regular season until last year and we took a step back, but we were better in the playoffs. I would trade the regular season five extra wins for better success in the playoffs. I do feel like we as a franchise will judge ourselves by how we do in the playoffs. And I want more consistency. When you are talking about [blowout] losses, we want to be a more consistent team in the playoffs.

Tucker asked Gearon why he changed his mind about selling the team.

New CBA. Having one less team to deal with. We resolved the [Steve] Belkin thing last year. Then we had the issue with our lawyers, got that behind us. It is emotionally draining and challenging to own and operate two teams. Very few teams in sports do it and it’s usually a corporation. [Stan] Kroenke is only one I can think of off the top of my head as an individual.

Tucker asked Gearon how season-ticket sells are going for the Hawks.

We are doing good. I think where we are struggling, and this is what the whole league, there is a chunk of revenue that comes from group and corporate sells. You usually sell those in the summer where you go to Home Depot and say, ‘We have a game on Saturday night in January, bring your company.’ But without knowing the schedule, we couldn’t sell that. I think the league as a whole is struggling with that. Tracy [White, senior VP of sales and marketing], two days ago said we are doing better at this point than we were last year.

Tucker asked Gearon how many season tickets the Hawks have sold.

I don’t spend a lot of time looking at the numbers except at the beginning of the year and the end of the year because you focus on basketball.

Do you have a special challenge in this market because so much of the population lives in the suburbs?

I think it’s a struggle for all sports teams in Atlanta. The league judges us on this massive demographics that go all the way out to Buford. That’s not a market.

Tucker asked Gearon what specifically about the new CBA makes him more optimitisc.

At the beginning of the summer, you saw the condition I was in, I’m crying on the TV and radio and I was just drained and exhausted. . . . I was emotionally spent. I thought maybe a new face [as owner] might make a difference. Being able to step back over the summer, [I was able to] get recharged,, get energized again. Looking at the new CBA, it is better for us. Long term I think there will be fewer teams to spend—I think the disparity between payrolls is going to be less. Last year you had the highest payroll in the league was $100 million and the lowest was $40 million. I think you are going to see that gap narrow. That’s a plus for us. We’ve been willing to be one of the bigger spenders but we have not been the biggest spender. Revenue assistance is a big question mark for us right now. I can’t tell at this point. We will receive revenue assistance and we did not under the old CBA.

What will it take to increase revenues for the Hawks?

One is being sure our fan base, that the perception of the team is accurate with the success and the commitment we have made to the team. We are a group that cares as much as anybody. I love the Atlanta Hawks. I was the biggest fan before I invested in the team and consider myself one of the biggest fans now. And I don’t think the fan base understands how much we really care. Part of it is changing the perception of us. Are we willing to spend money? We’ve done that. The knowledgeable fan gets it, but the one you are trying to lure in, they don’t get it. The young kids get it. My son’s friends, they don’t read the paper. They go watch a playoff team.

But I will tell you I think, when you are building a team long-term . . . take the kids who were in high school four years ago and now are juniors and seniors in college and they are still following us. I was out in Colorado last year or the summer before and I was wearing a Hawks shirt, which I don’t do a lot of in front of people because I think it’s kind of a gimmick. I pass this guy he says, ‘You are a Hawks fan?’ He says, ‘Oh I love that team.’ He was watching us in the playoffs. I didn’t tell him I was part of the team but I was very curious to hear what he had to say as a fan. He said, ‘God, man, this team has been so exciting the last couple of years.’

The one thing that is incredible—you have only been here a couple years, Mike—the Hawks were not known to be, and frankly no teams in Atlanta were known to be a team that can win a seven-game series. The Hawks struggled with that forever. Then we took Boston to seven games and lose [in 2008], which that was fun because we weren’t expected to win a game, we were 36-45, they had the best record in the league. We beat them every game here, we got blown out there, but we had some great games here. Then the next year we take Miami seven games and Joe, in that seventh game, he won the game for us. Next year we play Miklwaukee–seven games. As a fan I’d rather play seven games and come out on top than win four to nothing. Because that’s not a fun series. You want enough of a rivalry. it gets back to parity. Showing up in Boston for Game 7 was a lot different than showing up for Game 1 and 2 because their fanbase realized, ‘Damn, this is a real team.’ And it made for a great seventh game—well, not saying great, we got blown out, but the anticipation was great. Two out of three years we’ve won seven-game series.

How do you grow [revenue]? By getting to the fai-rweather fan and [make him] realize, one, we care, two we are willing to spend money and three look at our success.

Tucker asks Gearon why he and his partners dropped the Atlanta Spirit name.

I’ve never liked that name. It wasn’t my idea in the first place.

Tucker asks if Bruce Levenson is still engaged with the Hawks.

He is very much re-energized. He was heavily involved in the CBA, I was not. He’s the governor [the team's representative on the NBA Board of Governors].

Did Levenson vote against the CBA?

I don’t want to answer for it. You can ask Bruce Levenson.

Michael Cunningham, Hawks beat