James Dolan is on a hot streak as Sphere Entertainment shares soar and the New York Knicks play in the NBA Finals.
The valuations of the NBA’s Knicks and the NHL’s New York Rangers have skyrocketed in recent yeas, buoyed by increases in the leagues’ media rights deals.
Dolan’s recent successes are changing some Knicks fans’ minds about his legacy.
The unlikely redemption story of New York Knicks owner James Dolan is underway. About a decade ago, in 2014 and 2017, ESPN ranked NBA owners using a panel of more than 200 people who contribute to its coverage of the league. While some owners rose in the rankings and others fell, one constant was Dolan. He ranked dead last both times . Here’s a passage from ESPN’s 2014 report : “To nobody’s surprise, New York Knicks owner James Dolan came in at a distant 30th. In fact, there was a greater margin between Dolan and No. 29 (Los Angeles Clippers owner Donald T. Sterling) than between No. 29 and No. 21 (Philadelphia 76ers owner Joshua Harris).” Dolan earned his reputation with a mix of poor team performance, uninspired front office hiring, and a reputation as a thin-skinned dictator, including banning former player Charles Oakley from Madison Square Garden and using facial recognition technology to monitor fans. Underlying it all, many Knicks supporters felt Dolan was infuriatingly un-self aware or, at least, not empathetic to fans’ plight. This was compounded by the song “Fix The Knicks,” written and performed by Dolan and his band JD & The Straight Shot in 2011. The line, “Doing my best, yes, that’s my promise. I check with my friends, call Isiah Thomas” drew audible gasps when performed in front of a live audience. Thomas’s stints with the Knicks as both president of basketball operations and later head coach were filled with missteps . But a funny thing has started to happen in the past few years – Dolan has had a string of successful ventures and showcased keen decision making. Most notably, given his image, the Knicks will return to the NBA Finals next week for the first time since 1999 with a chance to win their first championship since 1973. The team’s 11 straight playoff wins follow years of deliberate, shrewd team-building that strayed from the high-risk, instant gratification personnel moves that marked much of the Dolan era. Dolan’s recent success goes beyond sports. In 2015, he sold Cablevision – the company founded by his father that turned him into a billionaire – to Altice USA for $17.7 billion. That transaction looks downright genius today as cable TV subscribers have declined in nearly every quarter since the deal’s completion in 2016 and broadband growth has stopped. Now named Optimum Communications, the company formerly called Altice USA has a market capitalization today of about $300 million . In 2023, Dolan spent $2.3 billion to open up the Las Vegas Sphere as an immersive dome-shaped entertainment venue. The investment is paying off. Sphere Entertainment shares are up roughly 250% in the past 12 months as the company sells out events and plans to build two new venues in Abu Dhabi and near Washington DC . Even AMC Global Media – the owner of cable networks including AMC, We TV and IFC, is having a bounce back year, up nearly 50% in the past year after dropping precipitously in the previous four years. The Dolan family is AMC’s controlling shareholder. And then there are the sports teams. Big jumps in media rights for the NBA and NHL have buoyed all franchise values, and the Knicks and the NHL’s Rangers are no exception. Dolan is now exploring splitting up MSG Sports, the parent company that owns both teams, to maximize the value of the Knicks and Rangers – and possibly set them up for an eventual sale. MSG Sports is up about 92% in the past year – driven in part by the Knicks’ run to the NBA Finals, but even more so by the run up in team valuations that’s been well documented in this newsletter. This all leads to an interesting question, specifically for Knicks fans: If the Knicks win the NBA title this year, is all forgiven with Dolan? Will the fan base come to appreciate Dolan as somewhat of a business savant who made the necessary managerial changes – hiring Leon Rose as team president and Mike Brown as head coach – to actually fix the Knicks? Or was the team’s time in the NBA wilderness during the 2000s and 2010s too much for even a title to overcome? CNBC asked this question to a small handful of Knicks fans in front of the New York Stock Exchange this week. The answers were mixed. Some say they will absolutely not forgive Dolan, and others say winning cures all.
