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While he was sleeping on his brother`s couch in New York, Jeremy Lin amazed most with his play on the court for the New York Knicks. In what was deemed "Linsanity", Jeremy Lin was even able to rank second on the list of best selling NBA jerseys, just behind Derrick Rose. So the real question is how much is Jeremy Lin worth to a franchise like the Houston Rockets? And is his three-year, $25.1 million contract good business for the Rockets?
First off, let`s breakdown Lin`s contract with Houston.
2012-2013 $5 million
2013-2014 $5.2 Million
2014-2015 $14.9 Million
First impressions of the contract may be that the Rockets are over paying for the third year of Lin`s contract. But are they really? It was recently reported by Darren Rovell of ESPN that the Rockets have signed Taiwan based tire manufacturer Maxxis to a sponsorship deal. Maxxis, which also sponsored the Knicks last year, followed Lin to Houston.
You can easily imagine that sponsorship deals, like Maxxis, wouldn`t be completed without a player like Lin on the Rockets. Back in 2002, the Rockets were fortunate enough to have another Asian player fall into their hands when Yao Ming was drafted no. 1 overall by Houston. According to Forbes, the rockets overall revenue increased by 87% from 2002-2010, the years that Ming was active for Houston.
While it`s unclear, and highly unlikely, that Lin will be able to duplicate the type of revenue that Ming had, Jeremy Lin will still be able to help the Rockets offset some of his contract costs with his sponsorship revenue ability. Last year, Houston averaged 15,363 fans per game, or about 85% of the Toyota Center`s capacity. In fact, the Rockets began moving some season ticket holders closer to the court for a better appearance on TV. And while "Linsanity" likely won`t be as crazy as it was in New York, there will still be some hype in Houston.
Overall, I think a 3 year, $25.1 Million deal for a prolific player like Lin is great for Houston. The Rockets have been stuck in mediocrity for the past few years, missing the playoffs and all the while having no star player on their team. If Lin is able to bring the Rockets anything, it`s more season ticket holders. The revenue that Houston will be able to bring in will most likely be able to offset the costs of Lin`s first two years at Houston, $5 Million and $5.2 Million. However, if Houston isn`t able to capitalize on Lin`s popularity, the $14.9 Million price tag on the third and final year of the contract, it could be all for nothing and a move that could set the franchise back.
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