No Dreamland for Gran Canaria: How EuroLeague is heading towards an inevitable format / News - Basketnews.com

Gran Canaria wasn't the first team to give up on their EuroLeague spot, but it's likely that they won't be the last either. As the EuroCup gradually loses relevance, the EuroLeague needs to undergo certain structural changes to make every club's participation worthwhile.

Credit: Rodolfo Molina; Patrick Albertini/Euroleague Basketball via Getty Images Credit Rodolfo Molina; Patrick Albertini/Euroleague Basketball via Getty Images

When Gran Canaria lost the nutrition company Herbalife as its main sponsor in the summer of 2021, witnessing the end of a nine-year partnership, the club immediately found a successor in Dreamland Studios Canarias. The agreement was for six seasons at a rate of about€550.000 in the first year.

3-pointers this season

37%10,5Points made:10,5Accuracy:37,3%Place in standings:1Record max:15Record min:5Most made 3FGs:Nicolas BrussinoTeamEuroCupStatisticsSchedule

That was one of the first steps the Spanish entity had to take to leave the COVID era behind. Almost two years later, on May 3, 2023, Granca won the EuroCup after beating Turk Telekom 71-67. However, the celebrations on the island didn't last long. Nor did the dream of participating in the EuroLeague.

Just ten days after lifting the trophy, the first clouds appeared. According to a report by Sotiris Vetakis for Live Sport newspaper, Gran Canaria seriously considered withdrawing from the EuroLeague for financial reasons.

BasketNews' Donatas Urbonas confirmed the report, adding that Valencia Basket were considered the frontrunnerto take Granca's position if the Spanish side ended up declining the spot.

Rumors and speculations dispersed a month later (June 12) by a unanimous decision from the club'sBoard of Directors. President Sitapha Savane pointed out that had Granca joined the 18-team lineup, "it would have beenirresponsibility disguised as bravery."

"We cannot mortgage the medium-term viability of the club," the Senegalese executive argued, and clarified that going from the EuroCup to the Euroleague means going from 18 regular league games to 34.

"In the EuroCup, there are normally three days between matches, in the EuroLeague just two. In addition, there are seven doubleheader weeks in the EuroLeague. Three games in five days leave no other option in many cases than the use of charter flights."

The team quite often chooses to stay in the first destination of the week and travel to the next match from there so they don't have to travel back and forth. As such, there have been numerous unusual stories involving its travels.

Throughout the years, the players had to travel in batches because there weren't enough seats on the plane. When he still played for Gran Canaria, current Real Madrid superstar center Edy Tavares had to lie down during takeoff because he couldn't fit into a seat until a passenger let him sit in the emergency row where there's more space.

The financial breakdown that could lead to a meltdown

This past season, Valencia Basket saw their travel expenses go from €500.000 to €1.5 million. Moreover, they take commercial flights whenever the option exists. Savane calculated the estimated amount for the Las Palmas team to €2.025.000 in case they took charter flights all season long.

The second economic section that would have required a greater effort is the increase in the number of players on the roster, with Savane highlighting the differences between different clubs of the same competition. He mentioned FC Barcelona and Madrid allocating almost €35 million to their basketball sections, while ALBA Berlin has one of the lowest budgets with €7.5 million.

That was an interesting observation since quite recently, the EuroCup winners presented a budget of €8.780.842 for the 2022-23 season, including a grant from the Island Council (Cabildo de Gran Canaria), owner of the club, worth €4.500.000.

The increase was significant compared to the 2021-22 campaign, when the Council allocated €3.2 million to the club's bank account, and was justified by the need to cover a €2-million deficit created over the last two years.

The Council is the government and administration institution of each of the seven major islands in the Canary Islands archipelago, with Gran Canaria being one of them. To a large extent, one could argue that the club would have been unable to function properly without state subsidy.

In the two seasons (2020-22) in which the COVID pandemic affected the ACB clubs, the Council contributed more than €5 million to compensate for the team's reduced income.

Gran Canaria's budget has been increasing year after year with the injection of public money, as the entity has been incapable of finding the necessary resources to survive. That being said, Gran Canaria is by no means a poor club in the ACB. Its budget is already close to €9 million, whereby the Island Council contributes more than half of it.

Players' salaries account for almost half of the club's total budget, varying between 4.2 and 4.5 million. According to local media, expenses for the coaching staff, spearheaded by Jaka Lakovic, and the front office members (most notably, sports director Willy Villar) were reduced by 9.3%, despite the qualifying bonuses for the ACB League Playoffs and the EuroCup title.

On the other hand, Gran Canaria received €450.000 as a prize money reward for their exceptional run in the EuroCup. They presented an income from the contribution of public sponsorship that almost reached €1 million (967.757), whilst cashing in another €1.8 million from advertisements.

Credit Euroleague Basketball via Getty Images

If one expected ticket revenue to change the balance drastically, that's hardly the case with Granca, who offer the cheapest season ticket in the ACB League at the price of €114 euros (€75 if it's renewed).

Gran Canaria had roughly 9.000 spectators in the EuroCup semifinal against Joventut Badalona, presenting an almost unblemished record at home with 13 wins and 2 losses (Lenovo Tenerife and Cazoo Baskonia) in the ACB and 12-0 in the European competition.

Income from season and single-game tickets is an essential element of any club's economy. Hence, apart from attracting many new subscribers, Granca warned that it would be necessary to increase the season ticket prices by up to 70% if their fans were going to enjoy the great spectacle of the EuroLeague.

Jorge Valero from Super Deporte notedthat the increase would only add up to €700.000 of additional income.

A cautionary tale

However, the turnup was very poor when the team played in the EuroLeague five years ago. That season was one of the worst in the club's modern history and constituted a cautionary tale that everyone remembers, albeit for all the wrong reasons.

Gran Canaria joined the EuroLeague in 2018 almost accidentally after eliminating Valencia Basket in the ACB quarterfinals.

However, their experience at the top level was nothing short of traumatic, as they finished 14th with a balance of 8-22. Their domestic record (14-20) wasn't much better, and apart from depriving them of a playoff spot, it also damaged the club's finances.

"We flirted with relegation throughout the season," Savane recalled and contrasted basketball with football regarding financial resources.

Las Palmas, who were recently promoted to Spain's top division, will receive between 50 and 60 million euros from La Liga and other sources. By comparison, Gran Canaria's earnings would basically be insignificant compared to the expenses.

"We would have earned between €350.000 and half a million," Savane added. "But we would have expenses above 4 million."

No matter how surprising those figures might look, they're nevertheless true. EuroLeague clubs' revenue is divided into three parts: a fixed payment, the Sports pool, and the Market pool.

All participating teams receive a fixed payment of €500.000, from which about €150.000 are deducted for arbitration fees. The Sports pool represents the amount each team receives based on their final ranking.

The distribution varies from €1.759.398 for the winner to €175.940 for the 14th-placed squad. The last four in the standings get nothing in return.

The Market pool corresponds to the income generated by sponsorships and television rights of the league, valued at close to €45 million.

However, they are only distributed among the 12 clubs with an A license, which are essentially the owners of the competition. For example, ALBA Berlin, which received a two-year wildcard in 2021 and didn't finish among the first 14 teams, only received €350.000.

Credit Regina Hoffmann/Euroleague Basketball via Getty Images

Savane is very much aware that in the EuroLeague economic model, the main income of 'temporary' teams like Granca comes from sponsorships and the sale of season tickets. For this reason, the EuroLeague is interested in attracting clubs from very large markets, such as Paris or London, which present a higher density of multinational or very large companies.

"That's obviously not our case," he noted. To further corroborate his claim, the former player and game commentator revealed that a large number of companies were invited to participate in a sponsorship scheme in order for Granca to be able to validate the EuroLeague ticket, but the financial support was simply not there.

"It would not be welcome to obtain €4-million grants of public money to face this adventure," he pointed out.

No EuroCup alternative

In any case, as far as that EuroLeague spot is concerned, the issue has been settled after a brief period of deliberation. Basketfaul reported thatEuroleague Basketball officials called Turk Telekom executives and asked if they wanted to participate in the competition.

Per the same report, the EuroCup finalists were contacted by Competitions Director Diego Guillen, who clarified that the application wouldn't automatically translate into a spot, but rather that the Turkish club's situation would be evaluated.

However, Turk Telekom didn't think the question was legitimate and sincere, as they were asked to reply within 24 hours. Thus, they didn't even bother applying, and Valencia Basket, perhaps the financially strongest club without an A license, entered the 18-team lineup.

Credit Euroleague Basketball via Getty Images

For clubs like Granca and Turk Telekom, a one-year ride in Europe's top flight could mean mortgaging their viability and sustainability, especially when coming off some tough fiscal years with million-euro deficits that have jeopardized their economic balance and structure.

Savane vouched that the next time the opportunity presents itself, Gran Canaria will be ready to seize it.

A history of fairytales gone bad

Being unable to participate in the EuroLeague isn't a new condition, even though Granca are indeed a special case. Other teams have found themselves in a similar position.

Brose Bamberg were the last to cut the ties, back in 2018, when they signed a five-year deal with the FIBA Champions League. Even though Bamberg was almost a permanent member of the elite, their participation was still subject to them winning the German league.

Since a huge brand, FC Bayern Munich, entered the picture that same summer (albeit having only reached the EuroCup semifinals) in the form of a two-year (2019-21) wild card, Bamberg understood that their time was up.

The only way they could get back to the EuroLeague was by being the BBL champions or the runners-up if Bayern won the trophy.

Credit imago/Zink

However, technically, Bamberg wasn't entitled to participate in 2018-19. In a different EuroLeague era, two Greek clubs gave up on their right to make the competition's regular season.

Maroussi came first in 2010, following its best season ever that did not only award them a spot in the EuroLeague qualifiers through the 3rd place in the Greek league but also saw them come literally one shot away from the playoffs.

Over the course of a few weeks, the club's financial problems became insurmountable, as owner Aris Vovos declared his inability to spend a single euro for its needs and coach Giorgos Bartzokas resigned in early September.

Maroussi's prospective owners/buyers promised a €1.76 million budget but could not provide any guarantee. Ultimately, the EuroLeague decided to disqualify the Greek side from the qualifying round due to failure to submit the requested documents in time.

Credit Panagiotis Moschandreou/Euroleague Basketball via Getty Images

Aris Thessaloniki fell victim to the same financial issues in 2011. They decided against participating in the qualifiers and thus saved the €50.000 deposit that the EuroLeague requested as a wild card fee.

Montepaschi Siena's fall from grace was completed in 2014 when the Tuscan club did not only exit the EuroLeague but also LegaBasket Serie A.

Under normal circumstances, and if they hadn't dissolved under the burden of long-lasting debts, Siena would have made the 2014-15 regular season as an A-License holder instead of Sassari.

'Accidents' rarely ever happen

It would be unfair or simply mistaken to presume that all the above-mentioned team's economic woes were caused by their effort to comply with EuroLeague standards and budget/infrastructure requirements. But it's undeniably true that the EuroLeague isn't for everyone.

It may sound shocking for a team to refuse to participate, but for those deprived of a guaranteed, long-term contract, it does make perfect sense.

The EuroLeague seemingly despises the small and medium-sized clubs that don't have billionaires or an affluent football club securing a steady cash flow. Instead, they are open to those willing to spend millions of euros without showing an interest in making a profit.

During the EuroLeague's opening press conference in Thessaloniki in 2000, former CEO Jordi Bertomeu publicly and unequivocally described the potential participation of any club without a large fanbase and ample financial resources as "an accident."

Credit Panagiotis Moschandreou/Euroleague Basketball via Getty Images

The Catalan executive was referring to Spanish club Manresa at the time, but his mindset included any small team that would win its place on the court, sneaking into the elite unannounced.

The creation of the EuroCup was intended as a means of absorbing several strong clubs that couldn't play in the EuroLeague. However, it has become a burden for the league and the clubs that essentially finance it every year.

FIBA pushing the envelope for EuroLeague teams

The ECA Shareholders Executive Board decided to change its financial policy only when the BCL was born (in 2016), signing a 10-year partnership with IMG and increasing the number of games.

In that context, FIBA's competition appeared like a mine in a stormy sea. Several years on, the scenario of a merger between the EuroCup and BCL seems like a resounding start. Still, it's important to decide exactly how the EuroLeague will be run in the future, how its burning finances will be sorted out, and how it will move forward.

Why should a club with no permanent license and, consequently, no access to the Market Pool vault make a push to be in the EuroLeague? Gran Canaria played 26 away games in the 2022-23 season, and that number would have been increased to at least 34 had they taken the leap to the top level.

The total distance covered last season was 121.000 kilometers. Gran Canaria traveledalmost twice as many air miles than an average NBA franchise. They had been in negotiations with Binter Canarias Airlines about the possibility of a partnership regarding charter flights but the process was to no avail.

Still, if Valencia Basket's revenue (€234.586 was the club's Prize Money this season, corresponding to 13th place) amounted to only 15.6% of the trips' costs (€1.5 million, according to Savane), it's clear that Granca would have even less to hope for.

Credit Alius Koroliovas / Contributor-Getty Images

Essentially, clubs like Gran Canaria will have to pay a heavy price for being included in an almost immutable lineup that's gradually turning into a closed competition. They have to pay for everything -- from flights to salaries-- while getting very little in return.

Comparisons with football competitions might be misleading, but one is tempted to think that with the exception of the two EuroLeague finalists (Real Madrid and Olympiacos Piraeus if we're looking at the 2022-23 season), no other team received more Prize Money than what the UEFA Champions League allocates for a group-stage draw (€930.000).

Wild cards galore

Instead of giving some additional motives to clubs like Granca, the EuroLeague Board is keen on generously handing out wild cards.

Of the six recipients that will repeat their presence in the 2023-24 campaign, only Partizan Mozzart Bet Belgrade and AS Monaco justified the trust shown in them with some sports achievements. Partizan made the playoffs and won the ABA League, while Monaco qualified for their first-ever Final Four and won the French championship title.

On the other end, Crvena Zvezda Meridianbet Belgrade, Virtus Segafredo Bologna, and Valencia Basket failed to win anything. At the same time, ALBA Berlin (a wildcard recipient that will soon become an A-License holder) probably had their worst season in years.

At the same time, LDLC ASVEL Villeurbanne occupy a permanent spot, albeit never coming close to the playoffs in their four-year EuroLeague trajectory (since 2019). Another A-License team (Panathinaikos Athens) has won less than one-third (31/96) of its fixtures over the past three seasons.

The question is what will happen if more and more well-off clubs with wealthy owners and big ambitions keep knocking on EuroLeague's door, just as Monaco did. What happens if Europe suddenly accommodates not 18 or even 24 but 30 clubs, all perfectly capable of meeting the most rigorous needs and demands?

That kind of gigantism, along with the orientation to clubs with certain profiles, is like shutting the door on any other contender.

Some of them, like Pinar Karsiyaka, Turk Telekom, Unicaja Malaga, Telekom Baskets Bonn, or ratiopharm Ulm (who beat both ALBA Berlin and Bayern Munich on their way to the domestic title), would certainly not lose sleep since their only way to sneak in is by winning the EuroCup. After all, they all lived to tell the story.

A special case to set a precedence

"You have to take into account that Gran Canaria are a special case because they're far away and have the most miles on their back traveling in the EuroCup," Ulm's sports director Thorsten Leibenath recently told BasketNews.

"At the same time, I don't think it's a testament to a bigger gap between the EuroCup and the EuroLeague. When I see the EuroCup now compared to five years ago, yes, there are a few weaker teams, but there are teams with ambitions too. For example, Paris Basketball and Prometey."

Leibenath, a former coach who successfully transitioned into a front-office role some years ago, thinks there's always going to be one team being allowed to the EuroLeague through the EuroCup.

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"I bet the BCL teams would love to have the possibility to enter the EuroLeague. For us, it was never a question of which competition we wanted to be in. We consider the EuroCup the second-strongest competition in Europe, which also offers the opportunity to enter the EuroLeague," he added.

The 48-year-old executive confirms the notion that the current EuroLeague lineup is perfect and, thus, doesn't need to change anytime soon. Even if his own team could join in for one season only.

"Under normal circumstances, the EuroLeague doesn't need Ulm," he admitted. "You don't want to change teams like Bayern Munich or ALBA Berlin. You want to keep them in and then attract a team from Paris and London. Then, they might add the Russian teams if they come back at some point, but they also need to keep one spot open all the time."

In their last two EuroCup campaigns, the 2023 BBL winners reached the quarterfinals. The tournament might be up for grabs since all the big budgets have taken the elevator to the top floor, but Leibenath thinks the EuroLeague will sooner or later deal with a smaller club breaking into the closed circle.

"It would be a one-year thing, we all know that," he conceded. "But it wouldn't hurt the EuroLeague. We would be a totally different team. We would play young players, and yes, we would lose by 30. But we could also surprise people here and there. A little bit of fresh air wouldn't kill the EuroLeague."

Some changes might be on their way

The EuroCup seems to be gradually losing its connection to the EuroLeague and becoming less relevant. Maybe that's why the ECA wants to create a new competition, which will be under the control of EuroLeague Basketball but will also cooperate with FIBA.

Per Spyros Kavalieratos of SPORT24, teams will be selected on the basis of performance in their domestic leagues, while the EuroLeague clubs without a guaranteed contract will be promoted and relegated accordingly.

In that way, the shareholders will have a permanent spot, and the rest will need to earn their place on the court, with the new competition serving as a springboard. Right now, it's unlikely that a solution between FIBA and the EuroLeague will be found before the 2024-25 season sets in.

Christos Milas, president of Promitheas Patras, confirmed that a unified competition might be introduced in 2024 or 2025. "We see that progress has been made in that direction, and we might have some developments next year," he told the Greek Basketball Federation's radio.

Milas also weighed in on the EuroCup-BCL comparison. Promitheas made their European debut in FIBA's competition in 2018 but moved to the EuroCup a year later. They reached the quarterfinals twice, but the 2022-23 campaign was their last one since they decided to return to the BCL.

"We now think that the two competitions are at the same level," he opined. "Certainly, there's more exposure in the BCL, which played a part in our decision. Plus, every game in the BCL is interesting. Games are interesting in the EuroCup as well, but that's harder for fans to understand," he reflected.

It's also important to note that, contrary to FIBA, Euroleague Basketball has set certain budget limits for its participating clubs. The EuroCup increased the minimum budget required from €2 to €2.5 million gross in 2022-2023, whereas the EuroLeague raised the bar for clubs to €7 million in 2021.

The European version of tanking

The EuroLeague arguably loves big ideas because they are the only ones it can support. Sponsorship deals or ticket revenues can hardly cover the clubs' needs.

Had Gran Canaria entered that landscape, it probably wouldn't have survived at any level. For German teams like Ulm, sustainability is the primary objective, not sports results.

On the opposite side of the spectrum stand teams from Greece or Serbia, prioritizing success on the court over anything else. That's why they allocate their funds accordingly.

The EuroLeague has drawn an invisible line by narrowing down the focus to a select few who can keep up with the traditional powerhouses of European basketball. Newcomers are either asked to win upon entry (to get a second chance) or to simply show up at games (even if they lose by 30, as Leibenath said) just because they represent a big market or boast significant resources.

Under these circumstances, Gran Canaria's failure to participate has facilitated the league to perpetuate and further strengthen its semi-closed character. Looking at the 20 clubs that will make up the 2023-24 EuroCup season, it's hard to guess which would make a solid EuroLeague squad one year later.

Credit Euroleague Basketball via Getty Images

Paris and London are the target markets but still lag behind in other areas. Prometey have the funds but not the following or the brand, while Hapoel Tel Aviv promise a colorful fanbase, but their arena is even smaller than the Salle Gaston Medecin in Monaco.

Aris are second to none in terms of fans and history, but they still owe €2 million in past debts, and their budget will hardly live through an 18-game regular season, where only the first six advance to the next round.

A reshuffling of the financial distribution, in order for everyone to be allowed to drink from the same well, could be a useful step. But a system that truly rewards success instead of being impassive to the European version of tanking would help just as much.

Starting next season, the introduction of the Play-Ins won't change the number of teams that will end up making the playoffs. What it can do, however, is render the regular season more interesting up until its last round and even make the sometimes blurred boundaries between failure and success more apparent.

Paraphrasing Sitapha Savane's words, maybe the next time Gran Canaria get the chance to play in the EuroLeague, a Dreamland could be out there waiting for them.

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