NBA pushes China expansion with new league store

By Ben Klayman

DETROIT (Reuters) - The National Basketball Association opened its eighth NBA Store in China, expanding its reach in a country where it sees huge potential.

The store, which opened on May 1 inside the Shanghai World Expo Performing Arts Center, features an assortment of league merchandise, including jerseys, basketballs, footwear, memorabilia and souvenirs.

"We pride ourselves on being the most popular sport in China," NBA China Chief Operating Officer Collins Qian said in a telephone interview. "We see an increased popularity of our brand."

The importance of overseas markets is growing due to the weak U.S. economy. NBA Commissioner David Stern said in February the U.S. economy and a crippling labor agreement with players would result in the league losing about $400 million this year.

China is the largest NBA merchandise market outside the United States with revenue doubling so far this season. Qian declined to say whether NBA China is profitable.

In January 2008, the U.S. sports league formed NBA China, a venture that could evolve into an NBA-affiliated league and employs almost 150 people in four offices.

NBA executives salivate at the prospects of that market as an estimated 300 million people -- a total about equal to the U.S. population -- play basketball in China.

The NBA has supported Chinese basketball for decades, including first hosting the Chinese national team in 1985. Chinese interest spiked after 7-foot-6 Yao Ming joined the NBA in 2002, and the league now has 51 different networks broadcasting games in China.

The number of viewers of NBA programing in China has risen 31 percent from the 2007-2008 season to a record of more than 2.1 billion, while traffic on the Chinese section of NBA.com has surged 60 percent in the same period. Over half of all traffic on the NBA.com website comes from outside the United States.

The NBA also formed a joint venture with sports and entertainment group AEG in October 2008 to build at least a dozen "NBA-style" arenas in major Chinese cities.

The Shanghai store is the first location built with the NBA's new global retail design, including arena-style lighting and game footage. Qian said it was launched in conjunction with the Expo, which is scheduled to run six months and expected to attract 70 million visitors, to better associate the sports league with China's development.

China is not the only overseas market where the NBA is making efforts. It recently opened an office in Johannesburg, boosting the number of markets with NBA offices to 16 with plans for four more by year end.

The NBA also has a more international flavor in its home market as Russian nickel magnate Mikhail Prokhorov was approved as owner of the New Jersey Nets last week, and a Chinese investor is awaiting approval in a deal for a minority stake in the Cleveland Cavaliers.

The share of international players on its team's rosters have grown from 5 percent in 1992, when the first U.S. "Dream Team" Olympic basketball squad played, to 20 percent now.

(Reporting by Ben Klayman; Editing by Tim Dobbyn)