NOBODY SAW MUCH of Daryl Morey in the days after the Houston Rockets landed in Tokyo for the NBA’s Japan Games. The Rockets’ general manager confined himself to his room at the Ritz Carlton in Roppongi Hills during the team’s six-day visit, spotted leaving for occasional jaunts to the Shake Shack located a half-mile away.
Morey had reason to shut himself inside. When he tweeted an image on Friday, Oct. 4, that read “Fight for Freedom, Stand With Hong Kong,” a sequence of events ensued that upended the NBA and one of its most recognizable franchises.
Yet apart from a follow-up tweet on Sunday that declared his intention wasn’t to offend Rockets fans and friends in China, Morey sequestered himself from public view. He didn’t attend the Rockets’ practice on Sunday. He skipped the team’s basketball clinic for Japanese youth on Monday. And though they were staying in the same hotel, Morey and NBA commissioner Adam Silver never met face-to-face. With Silver in Tokyo for less than 48 hours amid a packed schedule of public events and crisis management, they conducted their conversations over the phone.
During the week that the NBA set up shop in Tokyo, the Ritz Carlton felt less like a luxury hotel than a diplomatic retreat where a high-stakes international negotiation hung in the balance. With each passing day, those on the ground sensed the tension compounding.
On Wednesday, a day after Silver followed up the NBA’s initial tepid statement by backing every NBA employee’s right to political expression, Morey got off the elevator in his trademark mock turtleneck and walked to the hotel’s Lobby Lounge on the 45th floor. He looked haggard, an appearance that wasn’t helped by his tatty beard, when he received one of the only people he would engage in Tokyo: Toronto Raptors president Masai Ujiri.
That Ujiri, who projects a statesmanlike persona, was Morey’s executive counterpart in Tokyo was both coincidence and blessing. Ujiri has written op-eds on the kidnappings by terrorist organization Boko Haram and the Atlanta Hawks’ Danny Ferry episode. He spoke out publicly against Donald Trump’s characterization of “s—hole countries” in the developing world.
Ujiri wanted to understand Morey’s interest in Hong Kong, his level of passion and its origin. Morey explained to Ujiri that MIT Sloan, where he received his MBA in 2000, was a thick pipeline to Hong Kong in the world of business. As conflicts between protesters in Hong Kong and the Chinese government in Beijing have grown increasingly contentious in recent years, Morey’s friends have continued to discuss the idea of political autonomy in Hong Kong. Morey revealed that the timing of his tweet coincided with the implementation of a new law in Hong Kong prohibiting protesters from wearing masks.
Ujiri told Morey he had spoken to a handful of general managers, who offered their support. Morey found that a bit unconvincing — he has never been widely popular among rival executives — but he thanked Ujiri for the well-wishes. Passersby in the airy room, be they team personnel or league staffers, couldn’t resist stealing a glance at Morey as they breezed by the small table.
Morey hadn’t seen Ujiri in person since the Raptors won the NBA Finals in June, and after debriefing on the China affair, the conversation drifted to basketball. Raptors point guard Kyle Lowry blossomed in Houston during Morey’s tenure. The two execs swapped stories about the competitive, occasionally maddening but incomparably singular player. They chatted about Nick Nurse, the Raptors’ head coach who came of age in the Rockets organization.
As Ujiri listened to Morey’s early impressions of the James Harden-Russell Westbrook pairing, it dawned on the Raptors exec that as happy as he was to extend support, the most consolatory thing he could offer Morey was a chance to be himself. For an hour or two, Morey dropped back into the comfortable role of exuberant NBA GM, the trigger-happy swashbuckler who enjoys texting preposterous trade proposals to other execs or baiting an opposing NBA player on Twitter — the guy who loves being Daryl Morey, for better or worse.
THE TENSION THAT bubbled inside that Tokyo hotel persisted throughout the Rockets organization and the league for weeks. League sources say NBA leadership continues to monitor trade negotiations between the United States and China. They believe that a resolution both sides find agreeable could help soothe the league’s relationships in its most profitable foreign market.
Nobody at the NBA or with the Rockets wished to speak on the record for this piece, nor did players, team owners or executives around the league. The collective silence is a reflection of not just the sensitive nature of the conflict, but also the belief that there are significant inflection points ahead.
Some around the NBA marvel at this perfect storm, and the number of variables at work is remarkable:
Morey just happens to be the top basketball exec for the one franchise with the strongest claim of being “China’s team.” That team’s organizational ambassador over the past two decades: Yao Ming, who carried the flag for China during the opening ceremonies of the 2008 Olympic Games in Beijing and now leads its top basketball league.
Morey published the tweet when NBA teams were literally boarding jets bound for China, and that matchup featured LeBron James, the NBA’s most influential star whose criticism of Morey would resonate the loudest.
On top of that, the United States and China had been engaged in one of the most contentious trade wars in recent history, while the Communist Party of China was celebrating its 70th anniversary in an environment of intense nationalism across the country.
If the general manager of an Eastern Conference cellar-dweller had posted the exact same tweet in March, would he have ignited this level of international controversy?
But all of that engendered little sympathy for Morey around the league, even as voices from across the American political spectrum rallied behind him. The crisis raged not only in Asia, where players, Silver and the Rockets contended with its immediate effects, but also throughout the NBA, which braced for the aftermath. Conversations with top business and basketball operations executives during the days that followed the initial events revealed a league beset by frustration.
Panic infected some front offices, which worried about a sizable reduction in salary-cap projections due to lost revenue from China. Teams that have spent years instructing players on the hazards of impulsive social media use were irritated to see an executive wreak havoc with a tweet. A few execs who respected Morey’s stance over events in Hong Kong expressed bemusement that he took the tweet down. To them, his decision to do so signaled a lack of conviction: If he felt his political expression warranted the fallout, then at least stand by it.
China’s state-run network CCTV, one of the largest international broadcasters in the world, has not aired an NBA game through the season’s first three weeks. Games have returned to Tencent, an ESPN partner that streams the NBA in China, but viewers can’t watch the Rockets. Asked when they expected the impasse to be resolved, nobody around the league could offer an approximate timetable, even as the NBA and CCTV officials maintain communication about the future of broadcasts in China.
Beyond just the fate of NBA games on Chinese platforms, the broader situation remains fluid and, to many in the league, inscrutable.
WHEN NBA TEAM presidents logged online for their quarterly video conference on Oct. 16, a palpable tension hung over the discussion. Less than 48 hours earlier, a despondent LeBron James told reporters in Los Angeles that Morey’s tweet was misinformed and had the potential to cause physical, financial, emotional and even spiritual harm.
Chinese companies that had existing sponsorship deals with NBA teams notified franchises early the previous week that those partnerships were being terminated until further notice. One NBA team says it immediately slashed revenue projections derived from Chinese sponsorship for the 2019-20 season to zero.
Beyond their spreadsheets, multiple sources say front offices around the NBA were shaken by the turmoil. The league had been enjoying a lengthy winning streak — a doubling of revenue over eight years, global expansion, positive coverage in the media. Some land mines lingered on the horizon, but NBA leaders had come to believe that there were few issues that couldn’t be managed — yet China was testing that faith.
After introductory remarks from commissioner Silver, Rockets CEO Tad Brown spoke to the group. Brown started with Houston 17 years ago as its director of corporate development. He inked the franchise’s first sponsorship contract with a Chinese company, Yanjing Beer Group, soon after the team drafted Yao.
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Brown acknowledged how much the events over the previous two weeks had affected every franchise in the league. He said he understood the economic impact, as well as the difficult position players, coaches, executives and teams now found themselves navigating. Fellow executives around the league appreciated Brown’s remarks as sincere and straightforward.
Brown’s comments then spawned a conversation about the prospect of large-scale demonstrations at NBA arenas and their possible long-term repercussions. While the discussion touched on Hong Kong and China, there was a collective acknowledgement that in the present-day NBA, protest was now a matter of course. The league had cultivated a brand identity around social and political consciousness, so it followed that when social and political issues come to light, NBA personnel will get a disproportionate amount of attention.
There’s still great uncertainty about the effects on league business, from the impact on salary-cap projections to the probability that the NBA can fully restore its relationships with Chinese broadcasters and corporate partners. Does the NBA have a shot of returning in the foreseeable future to China, where it has played preseason games in every non-lockout season since 2007?
No team has felt the brunt of the fallout more than the Rockets. League sources say the franchise has lost more than $7 million in revenue this season from cancelled Chinese sponsorship agreements and nearly $20 million overall when terminated multiyear deals are calculated.
Previous Rockets owner Leslie Alexander was able to parlay the Rockets’ presence in China into numerous investment opportunities, from wine distribution to the Chinese auto aftermarket. The friction between the NBA and China could temper any ambitions his successor, Tilman Fertitta, has to expand his portfolio into China after paying $2.2 billion for the team in 2017. For their superstar James Harden, the losses could be considerable if no resolution is reached. A source says Harden’s endorsement agreement with Shanghai’s SPD Bank Credit Card is imperiled.
During Yao’s heyday in Houston, there was a common joke in the NBA: The two best ways to get a shoe deal were to be an All-Star or play next to Yao Ming. Shane Battier, Luis Scola, Bonzi Wells and Chuck Hayes each cashed in with Chinese footwear companies, as has a new generation of NBA players that includes Klay Thompson, CJ McCollum and Gordon Hayward. But as the current standoff wears on, the Rockets’ magic potion might have turned into a poison pill.
AS AN EXECUTIVE who values digital platforms as a means to communicate with the world, Morey hired a Chinese firm a few years ago to help him manage his social media accounts in the country, including Weibo. That company dropped Morey as a client immediately following his tweet. Soon after, security consultants advised Morey to install advanced protective software on all of his devices and change his passwords to maximum strength.
When Morey reached out to a number of friends from Hong Kong soon after the story exploded, a few were too petrified to speak to him. Others, including some friends stateside who were concerned about surveillance and hacking, instructed him to install secure apps such as WhatsApp, Telegram and Signal. One of Morey’s closer friends from Hong Kong had his attorney return Morey’s call on his behalf. The lawyer, who declined to offer his name when contacted by ESPN, told Morey that all communication should be channeled through him until further notice.
When Morey was named the NBA’s Executive of the Year by his peers in 2018, he was genuinely shocked, believing himself too unpopular to win the award. A computer science major/MBA-turned-strategy consultant before his career as a front-office exec, Morey has embraced his persona as the NBA’s chief disrupter. He co-founded the MIT Sloan Sports Analytics Conference (of which ESPN is a sponsor), one of the professional sports world’s annual power confabs, and he readily uses social media, whether to advance voting reform or to trash-talk an NBA player who is in a public tiff with a Rocket.
Few of Morey’s colleagues around the NBA were surprised by his post. Most fellow execs saw Morey’s decision to comment on Twitter about the conflict between Hong Kong and Beijing as consistent with his behavior during his 13 years as Rockets GM.
This is a general manager who, after all, took the unusual tack over the summer of submitting to the NBA a signed, executed player contract between the Rockets and Nene laden with questionable incentives, daring the league to reject it. The NBA office, miffed that the Rockets didn’t check about the deal’s legality ahead of time, chose to amend the contract on its own — quickly diminishing the valuable trade chip Morey was hoping to manufacture. The episode was another instance of Morey testing limits as one of the league’s most aggressive general managers.
In contrast, conversations with nearly a dozen NBA front-office executives show that most have an acute allergy to this specific conflict with China.
“I honestly just try to stay away from it,” one NBA team exec said. “It’s like watching my dog vomit.”
Many executives said they would like the NBA to develop guidelines for dealing with China and other politically sensitive topics, rather than leaving teams, players and executives to formulate them on their own. For example, those making a preseason trip to India in the future would appreciate some direction on how to respond to any questions about regional tensions around the subcontinent. League sources acknowledge the need for guidance.
Though a couple of NBA executives speculated Morey might have greater difficulty attracting marquee free agents to Houston, few said that his ability to perform his job would be affected beyond having to placate Fertitta, a shotgun marriage that sources close to the Rockets have considered a tenuous fit since Fertitta bought the team in 2017.
None of the executives doubted Morey’s interest in the political issue in question, but almost all of them suggested that Morey would figure out how to leverage the ordeal into a net positive for himself. Several noted that, in recent years, Morey has immersed himself in so many disparate pursuits — the Sloan conference, theater production, Silicon Valley, techno-activism — that his impulses are best interpreted as groundwork for his next big thing.
As the NBA regular season enters its fourth week, the anxiety of front-office executives skittish about lost revenue and arena protests has largely receded. The quandary with China is a black box whose contents remain mysterious. It’s something for Silver and his brain trust to figure out while these execs busy themselves with the management of their rosters, owners and fan bases. And little has changed about Morey’s day-to-day dealings with rival front offices.
But Morey has maintained a low profile over the past few weeks. He has discussed only basketball publicly, while taking to social media to celebrate Houston’s new backcourt pairing and to recognize center Clint Capela’s charitable work. On Monday, he retweeted a clip from “Last Week Tonight with John Oliver” about the liabilities of faulty voting machines.
But on matters relating to East Asia, Morey — like the rest of the NBA — has remained silent.