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Glocalization On Chinese Basketball

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Glocalization On Chinese Basketball

glocalization and chinese basketball

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The International Journal of the History of Sport

ISSN: 0952-3367 (Print) 1743-9035 (Online) Journal homepage: http://www.tandfonline.com/loi/fhsp20

Glocalization and the Rise of the Chinese


Basketball Market

Lin Luo, Yongguan Dai & Fuhua Huang

To cite this article: Lin Luo, Yongguan Dai & Fuhua Huang (2015) Glocalization and the Rise
of the Chinese Basketball Market, The International Journal of the History of Sport, 32:10,
1321-1335, DOI: 10.1080/09523367.2015.1066992

To link to this article: http://dx.doi.org/10.1080/09523367.2015.1066992

Published online: 24 Jul 2015.

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Download by: [University of California, San Diego] Date: 02 January 2016, At: 04:52
The International Journal of the History of Sport, 2015
Vol. 32, No. 10, 1321–1335, http://dx.doi.org/10.1080/09523367.2015.1066992

Glocalization and the Rise of the Chinese Basketball Market


Lin Luo, Yongguan Dai and Fuhua Huang*

School of Physical Education and Sports, Jiangxi Normal University, Nanchang, Jiangxi, P.R. China

This paper examines the response and strategies of Chinese basketball governors in
coping with the glocalizing National Basketball Association (NBA) market. It argues
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that the worldwide spread of capitalism and commercialism under globalization has
resulted in the expansion of the Chinese basketball market. The NBA’s growing
business in China has not overwhelmed the local market. In actuality, Chinese
basketball has successfully achieved further commodification and benefited from the
adaption of the NBA’s certain forms of capitalistic operations for profit. Emulation
from the NBA’s marketing strategies in governing Chinese professional basketball has
proved to be practical.
Keywords: globalization; glocalization; China; basketball; market

Introduction
Globalization has swept across every corner of the world in the past few decades. Under
the trend of globalization, the borders of nation states are shrinking, the pace of human life
is accelerating, and the world is increasingly interconnecting and being bound together.
China, the most populous country on earth, is rising as a key player in the global
community. The move from a state-planned economy to a market-oriented economy,
which began in a small way in the late 1970s and has progressed rapidly since the early
1990s, has heralded China’s desire to engage with globalization. Since then, China has
benefited from an unprecedented global flow of the capital, human talent, scientific
knowledge, and other resources, which are required for the country’s modernization, and
has become the fastest-growing economy in the world with a gross domestic product
(GDP) growth rate averaging close to 10 per cent per year.
For the Chinese sports market, globalization is often seen as a double-edged sword that
brings both opportunities and challenges, advantages and disadvantages. But most Chinese
scholars tend to believe that the opportunities outweigh the challenges, that the advantages
outweigh the disadvantages in this global –local interconnectedness.1 However, while the
open-up policy has allowed transnational sporting entities to do ‘big business’ in China, it
challenges China’s sport authorities’ capacity to govern native sports markets. This paper
examines how Chinese basketball governors have coped with the glocalizing market of the
National Basketball Association (NBA) from the U.S. The first section of this paper
provides an overview of the NBA’s marketing territory in China. The second section depicts
how Chinese basketball has undertaken marketization with emphasis on its adoption of the
NBA’s marketing strategies under the North Star Project (NSP). The third section addresses
the strength and share of the Chinese basketball market held by the NBA and the Chinese
Basketball Association League (CBAL) by analyzing their advantages and disadvantages.

*Corresponding author. Email: huang.fuhua@jxnu.edu.cn

q 2015 Taylor & Francis


1322
2 L. Luo et al.

Glocalization and the NBA’s Chinese Marketplace


Over the past three decades, the power of capitalism under free-market consciousness and
neoliberalism has pushed sports marketing to a global level. The power of capitalism is
so radical that, Ritzer argues, no other force has contributed more to globalization.2
Developed from Marx’s understanding that ‘capitalist firms must continue to expand
or they will die, and when possibilities for high profits with a given nation decline,
capitalistic businesses are forced to seek profits in other nations’, he suggests that such
capitalistic firms have eventually led to exploration and exploitation of possibilities for
profit in more remote and less developed regions.3 The NBA is in the vanguards of these
American capitalistic firms.
In the USA, the entertainment industry is a significant and fast-growing economic
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sector of which American professional sports form an important worldwide segment that
has been in the forefront of the drive for sports commercialization and globalization. The
NBA’s strategies of tapping into Asian markets were carried out at the start of David
Stern’s global campaign, particularly in Greater China. Since the establishment of its first
overseas office in Hong Kong in 1992, Greater China has been a major overseas market for
the NBA. To service its exploding popularity in China, the NBA set up a regional office in
Beijing in October 2002 and in 2004 in Shanghai.4 In January 2008, the NBA China Group
was set up to conduct all the NBA’s business in Greater China. It attracted an investment
of USD 250 million (EUR 187.5 million) from five giant corporations, including the Walt
Disney Company, the Bank of China, Lenovo Group, the Li Ka Shing Foundation and the
China Merchants China Investment Management Limited.5 Timothy Chen, former head of
Microsoft’s China operations and previous chairman and president of Motorola’s China
unit, spearheaded the office. NBA China is now headquartered in Beijing, with branches in
Shanghai, Hong Kong, and Taipei, currently totalling over 100 staff.6 China, as the fastest
growing economic giant in the world, has taken up a significant portion of the NBA’s
global business territory and is now the NBA’s largest market outside the USA.
In general, for an individual sports firm, marketing is normally undertaken through three
domains: marketing of sports, marketing through sports and grassroots sports marketing.7
First, with respect to the promotion of NBA games, the NBA’s strong network of television
and digital media outlets has cultivated a developed sports show market in China. It has also
benefited from the rise of Chinese basketball players, particularly Yao Ming, in the NBA,
which has occurred in tandem with the growth in China’s sports spectating market.
Consequently, the NBA began holding NBA China Games in 2004 to further nurture
demand in its Chinese consumer base. Second, the NBA’s global expansion has activated a
sponsorship market, which draws sponsors from a combination of world-class Chinese
corporations and multinationals, thus incorporating China’s sporting resources into the on-
going global economic flows. Third, the NBA has prompted the development of Chinese
grassroots basketball, with a variety of promotional campaigns being held by sponsors.8

Emulation, Commercialization and the Emergence of an Indigenous Basketball


Market
The ‘Marketization’ of the Jiaji League (1995 – 2003)
Owing to China’s socialist institution, adopting market-oriented strategies in operating
professional sports is challenging for the governors. Although the Chinese Basketball
Association (CBA) is constituted as a non-beneficial and non-governmental organization,
it is clear that the officials from the government are the true power in governing the Jiaji
The International Journal of the History of Sport 1323
3

League (1994 –2003) or CBAL (2003 – ).9 During the process of marketing the league,
government officials are monopolizing the power in the same way. However, the Chinese
basketball governors do not market the league by itself, but work with marketing agents.
To generate sufficient income to become self-supporting, before the inauguration of the
Jiaji League, the CBA signed a commercial contract with International Management
Group (IMG) for six years. The contract was worth USD 2.5 million (EUR 1.88 million)
for the first year and USD 3 million (EUR 2.25 million) for the remaining years.10 IMG
brought the Jiaji League two considerable sponsors soon after signing the contract. During
those years, the Jiaji League was sponsored by two large cigarette companies, ‘555’ and
Hilton. With their support as the named sponsors of the league and other sponsors (in a
small way), such as Nike, Gatorade, and Ford, IMG managed to survive. This co-operation
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model with sports agents provided a certain success when developing China’s professional
basketball market.11 Li Dunhou, Vice-director of the Finance Department in the General
Administration of Sport (GAS), claimed that
We earned more than 3 million (EUR 2.25 million) per year by selling the commercial rights
of the Jiaji League, including the naming rights of the league, promotion rights, and 75% of
the advertising rights of the stadiums, to the IMG.12
After this six-year contract, the IMG refused to renew the contract with a higher fee as
the CBA claimed. The reason for IMG’s retreat was that cigarette companies were
prohibited from sponsoring sports competitions by the Chinese government after 2001.
But most Chinese marketing partners of IMG at that time were cigarette companies. It was
difficult for IMG to raise the price to the CBA in a new three-year contract as the IMG
itself was in financial crisis.13 Later in that year, Yang Cheng News Group took over from
IMG as the marketing agent of the Jiaji League, offering RMB 35 million (EUR 4.375
million) per year. Ironically, the CBA forgot to sign a formal contract with the Yang
Cheng News Group who refused to fulfil their previous oral agreement with the CBA when
they began to realize that their commercial rights would be subject to interference from
government officials. This caused a crisis over how the 2001 – 2002 Jiaji League season
could start within 45 days with insufficient financial support.14 In order to solve this
problem, the CBA had no choice but to run the league at the Zhonglan Sport Development
Center, which was owned by the GAS.15
In this period (including the ‘Initial Season’), television broadcasting of the Jiaji League
games was neither beneficial nor popularizing the league to the audiences. In the first three
seasons, the Chinese Central Television (CCTV) broadcast the games without any fees paid
to the CBA. For some less-popular clubs, they had to pay a certain amount of money to
CCTV for exposure.16 In the 1997 –1998 season, CCTV provided a two-minute advertising
interval for the selected clubs.17 In the 1998– 1999 season, Jiangsu Nangang sold their
broadcasting rights to Jiangsu TV for RMB 500,000 (EUR 62,500). Liaoning Hunters
received RMB 150,000 (EUR 18,750) by selling the broadcasting rights for the whole
season. This figure was equivalent to 2.3% of the total revenues that all the CBAL clubs
generated in the season.18 In the 1999– 2000 season, Zhongguang Network, which was
owned by China Sports Publications Corporation under the GAS, started to market the
broadcasting rights of Jiaji League games collectively. Zhongguang Network changed its
name to Huaao Xingkong Network in early 2000.19 In 2001, Huaao Xingkong Network
reached a contract with CCTV-5, who would pay RMB 2.8 million (EUR 0.35 million)
for 60 games in the coming season. This marked the first broadcasting contract for the
Jiaji League. Twenty-three provincial or municipal television broadcasters also signed a
contract with Huaao Xingkong Network in that season. In addition, Huaao Xingkong
1324
4 L. Luo et al.

Network produced the Lanqiu Fengyun (Basketball Time), a 30-minute basketball


programme about the Jiaji League, for the broadcasters. However, revenue from selling the
league’s broadcasting rights was far from sufficient to support the league’s expenditure.20
In short, the major ways in which the Jiaji League could generate income were by
selling commercial rights to sports agents or selling the league’s naming rights themselves
in the Jiaji League period, as shown in Table 1. The league’s income and expenditure
managed to stay balanced in the last two seasons with the support of Motorola.21 But the
withdrawal of Motorola pushed the league into financial difficulty again. Before the
2003 –2004 season, a Taiwan company promised to offer RMB 20 million (EUR 2.5
million) for the league’s naming rights. But it withdrew one day before the media
conference to launch the new name was to take place. Fortunately, China Unicom agreed
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to take over the contract. But that season was still in deficit, with the league losing RMB 15
million (EUR 1.875 million).22 Thus, the Jiaji League basketball marketization
programme was humbled.

The Rise of the CBAL Market with the NSP since 2004
Before the 2003 –2004 season tipped off, Li Yuanwei was appointed the new head of
Chinese basketball. The name of Jiaji League was changed to the CBAL. Intensifying
marketization of the CBAL was one major task identified by Li Yuanwei in his NSP. The
central concept of the NSP in relation to marketization was to amplify ‘competing
basketball’ into ‘entertaining basketball’ and ‘moneyspinning basketball’,23 which was
inspired by the branding operation of the NBA, as Li recalled:
The first time I watched a NBA game was in 2000 in Miami. I was shocked by what I saw in
the stadium: fans were queuing to buy hot dogs, drinks and merchandises; it was like a
weekend party rather than a sports competition; dancing performance by cheerleaders heat the
game up; sponsors were doing all kinds of commercial promotions on the court; the cameras
captured Hollywood stars and well-known persons from time to time; when the home team
lost the game, the fans were still enjoying their party, not being depressed or resentful as
would normally happen in Chinese sports contests. Since then, a concept of ‘branding the
games, serving fans, serving media, serving sponsors’ is impressed in my mind. I wish I could
bring such basketball games and culture to Chinese basketball fans.24
Therefore, with the implementation of the NSP, the CBMC advocated the key
marketing strategy named ‘One Focus and Three Services’, which was to focus on branding
the league and serving the fans, serving the media, and serving the sponsors.25 Although
branding is a fundamental marketing strategy in sports business, it was something

Table 1. Naming Rights Sponsors for the Jiaji League (1995– 2003)
Season League name
1995– 1996 555 China Men’s Basketball Jiaji League
1996– 1997 Hilton China Men’s Basketball Jiaji League
1997– 1998 Hilton China Men’s Basketball Jiaji League
1998– 1999 Hilton China Men’s Basketball Jiaji League
1999– 2000 Hilton China Men’s Basketball Jiaji League
2000– 2001 Hilton China Men’s Basketball Jiaji League
2001– 2002 Motorola China Men’s Basketball Jiaji League
2002– 2003 Motorola China Men’s Basketball Jiaji League
2003– 2004 China Unicom China Men’s Basketball Jiaji League
Source: adapted from the Jiaji League’s schedule from 1995 to 2003.
The International Journal of the History of Sport 1325
5

untouched in Chinese professional basketball when Li decided to do so, because most


Chinese sports officials had no experience in sports marketing. Li said:
To be honest, I didn’t have much knowledge about branding. I had been working on teaching
and doing research in universities and institutes before joining the CBMC. My previous years
in the CBMC concentrated either on athletic training or competition management. I hardly
had any knowledge about economics and marketing.26
He went on to state:
However, I decided to emphasize the importance of branding the league after the research
report released by, and at the suggestion of, the Shanghai Qianrui Sports Business
Consultancy Corporation. And I finally found out why the CBAL lagged so far behind the
NBA in terms of sponsor marketing in China. For a long time, we have tried our best to target
and build relationships with Chinese giant marketers, such as China Mobile, Lenovo Group,
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Air China and Mengniu Group. But they were so eager to sponsor the NBA, that they deserted
the CBAL. The cause of this is the disparity of brand value between the two leagues. That is
why I emphasized branding the league in the NSP so much.27

Marketing of the CBAL Games


As a result, to better brand the league, the 2004–2005 season witnessed a set of changes in the
league’s schedule to increase the number of CBAL games: the promotion and relegation
system was abolished; the league was divided into two conferences; and the number of games
for each team was increased to three each week. The total number of CBAL games was
increased to 317 from 155 in the previous season.28 More importantly, the CBMC picked the
Shili Media from tens of candidates as the branding agent in 2004. Since then, with the help of
Shili Media, the CBAL has adopted a series of branding strategies. The first strategy was to re-
image the league, which innovatively integrates traditional Chinese cultural elements into the
games.29 For example, the logo of the CBAL was changed from a common basketball image
to the ‘Face of Basketball’, which infused a traditional Chinese face from the Beijing Opera
into a basketball image. In the 2004–2005 season, a slogan of ‘My Team, My Game and My
CBA!’ was put forward.30 The slogan was changed to ‘Your Turn on the Court!’ in the 2005–
2006 season31 and was changed again to ‘Emperors in Flames of War!’ in the 2006–2007
season32 and ‘Force of Three Swords!’ in the 2007–2008 season.33
Therefore, the opening game of the 2004– 2005 season demonstrated a new face
of Chinese professional basketball. Before the game started, the ‘basketball babies’
(cheerleaders), which was made up of a team of young and beautiful girls hired from
professional dancing studios in Beijing and Shanghai, performed and danced on the
basketball court. Under the neon lights, a huge octagonal lantern support was upraised. With
the gorgeous fireworks flaming from the floor, the lantern support was cracked and a huge
basketball signing ‘CBA’ turned up with rock music to the 6000 spectators. Then a group of
young men in traditional Chinese Tai Chi costume jumped to the court and started to play
street basketball with Tai Chi strikes. They were followed by a dancing lion playing with a
basketball around the court.34
Regarding ‘serve the media’, the NSP made great efforts to improve the relationship
between the CBMC and media workers.35 Li Yuanwei acknowledges the power of
the media in sports marketing and the importance of transparency to achieve good
governance, he said:
In my opinion, we should treat media workers sincerely, respect them and support them.
We should not stand high above them as governmental officials. Only by behaving in this way
can we achieve the most efficient co-operation.36
1326
6 L. Luo et al.

He enumerated two lessons he had learnt from his predecessor, Xin Lancheng. The
first one occurred at a press conference. Liang Xiyi, a renowned journalist with Xinhua
News, asked Xin, ‘Can the CBMC provide better service to the media?’. Xin answered,
‘You are working for your career, I am working for my career, so why do I need to serve
you?’.37 The second happened at a buffet lunch during the Shanghai Basketball Routine
Meeting in 1999. One young newspaper reporter asked Xin, ‘Mr. Xin, I heard that you
don’t like newspaper reporters . . . ’ Xin glared at the young men and answered directly,
‘Yes, you are right!’.38 Learning from this, the NSP formulated that: from 2004, the
CBMC (1) appoints one media spokesman to share information on the league with media
workers; (2) holds a media salon on the first Monday night of each month; (3) holds regular
media conferences; and (4) arranges open days for the national teams’ training activities.39
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Notwithstanding, income attracted from selling broadcasting right is still minor. It is


still hindered by the monopolistic broadcasting system in China. There is only one
nationwide sports broadcaster, CCTV-5, which holds the sole authority to decide which or
whether CBAL games are put on and tends to reduce the broadcasting fee. Ma Guoli, CEO
of Infront, commented:
Some low-profile CBAL clubs have to pay extra money to CCTV-5 for exposure. It is abnormal
for a developing sports industry. In many countries, selling television broadcasting is a major
source of income. But in China, this immense market is locked away. The monopoly position of
CCTV-5 should be broken in order to expand China’s sports broadcasting market.40

Marketing through the CBAL Game


To attract more sponsors for the league, the CBMC created a new mode of
sponsorship. The league naming rights were cancelled to be replaced by four types of
sponsors: the chief sponsor, the sneakers and apparel sponsor, marketing partners, and
general authorized suppliers.41 As for the chief sponsor, the CBMC and Infront came up
with a seven-year contract in 2005. According to the contract, Zhonglan & Infront
Company, which is jointly owned by the CBA and Infront, is set up as the marketing agent
of the CBAL. Infront had a 49% shareholding and the CBA held the remaining 51%.
Infront provided USD 6.5 million (EUR 0.81 million) each year for the expenditure of
running the league, while all the commercial rights, including those from the venues of
all clubs, were operated by Infront. At the end of each season, the CBA shared 85% of the
total income with Infront taking the remaining 15%. Additionally, Infront had priority to
renew a five-year contract after the expiration of this contract in 2012.42
Soon after its establishment, Zhonglan & Infront contributed to fostering the CBAL
market. First, Zhonglan & Infront merged with the Basketball Company, which was
holding the rights to run the official CBA website and the real-time statistics of the CBAL
games. Second, in 2006, Zhonglan & Infront renewed the contract with Leisu Sports
Supplying Company, which had been producing CBA-authorized merchandise since 2001.
According to the contract, Leisu would give up its own brand and was authorized as the
only factory to produce and sell authorized CBA merchandise. The CBA would receive a
commission on a portion of Leisu’s revenue.43
Third, and significantly, as for the sneakers and apparel sponsor, Zhonglan & Infront
and Anta Sports have achieved a win –win alignment since 2004. In the past, sneakers and
apparel providers were categorized as general authorized suppliers. Except for the first two
seasons when they were collectively supplied by the league, the clubs had to seek out
suppliers on their own. For some strong teams, such as the Bayi Army Basketball Club,
Gungdong Hongyuan Basketball Club, Jiangsu Nangang Basketball Club, and Liaoning
The International Journal of the History of Sport 1327
7

Panpan Basketball Club, sports gear suppliers were eager to provide gear for their players.
But for those weak teams, few suppliers were willing to sponsor them. Thus, Zhonglan &
Infront attempted to obtain a sneakers and apparel sponsor for the CBAL.44 Li said:
It is a good way to generate more income for the league through appointing a sneakers and
apparel sponsor, and we are happy to provide this good service for the clubs.45
However, most giant sports suppliers showed little interest in sponsoring the CBAL.
Li recalled:
At first, we wished to cooperate with a giant sports suppliers, Nike, Adidas or Li Ning, one of
those three. But they were not willing to enter the sponsorship with us, because they didn’t
consider investing in the CBAL would benefit them. I understand them anyway. The CBAL
was not popular enough to draw their interest. I didn’t lose heart, but it made me more
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determined to brand our league.46


Before the 2004 –2005 season tipped off, Zhonglan & Infront signed a three-year
contract appointing Anta as the ‘CBAL Authorized Sneakers and Apparel Sponsor’.47 Anta
was a less well-known sports manufacturer and supplier at that time. It was an OEM for
Nike, Adidas, and Converse before it started to promote its own brand in the late 1990s.48 On
signing the contract, Anta worked with the Sports and Exercise Research Center under the
GAS to design sneakers that fit Asian feet. They also hired top designers throughout the
world to design basketball footwear and jerseys for CBAL players.49 The co-operation of
Anta and CBA was a very successful case of sports sponsorship. When Anta started to
sponsor the CBAL in 2004, its annual turnover was RMB 310 million (EUR 38.75 million),
which jumped to RMB 670 million (EUR 83.75 million) in the next year. In 2006, it nearly
doubled again to RMB 1.25 billion (EUR 156.25 million) and the figure kept increasing to
RMB 2.98 billion (EUR 372.5 million) in 2007.50 Anta and the CBA renewed the contract
for another five years in 2007. The annual turnover of Anta jumped to RMB 4.63 billion
(EUR 578.75 million) in 2008 and RMB 5.87 billion (EUR 733.75 million) in 2009.51 Ding
Zhizhong, CEO of Anta commented, ‘The CBAL is different today, Anta is different, too.
Both the CBAL and Anta are rising in value. We advanced side by side these years, and we
have achieved win-win co-operation’.52
On the whole, with the branding strategies and the effort of Zhonglan & Infront, the
CBAL’s sponsor marketing has kept growing since 2004. As depicted in the following
figure (Figure 1), the total number of CBAL’s sponsors increased from seven to 23 within
the nine seasons from 2004 to 2013.

Grassroots Marketing
Grassroots marketing was part of the ‘serving the fans’ strategy, which Li Yuanwei also
directed towards the construction of a Chinese basketball culture as the NBA does. Besides
the basketball events for fans and mass participants, the CBA has also conducted
community enrichment programmes since 2004. In 2005, the CBA and the ‘China Youth
Development Fund’ jointly launched a welfare project named ‘Growing-up Together with
CBA’.53 At the beginning, the Fund encountered financial difficulty. The budget of the
CBMC had been running out for the reason that hiring media and public relationship
consultancy companies had taken up most of the budget. But for Li Yuanwei, ‘this project
is significant for the CBA to build up a healthy image within society. It is also the social
responsibility of basketball practitioners’.54 Therefore, the CBMC decided to make use of
the first sum of money that Yao Ming handed in to the CBMC for permitting him to play in
the NBA, which was USD 160,000 (EUR 20,000). The CBMC also encouraged clubs and
1328
8 L. Luo et al.

Number of CBAL Sponsors


25
22 23
20

15 16 16
14
12
10
8 8
7
5 Number of CBAL Sponsors

09

10

11
08

13
06

12
05

07

0
0

0
0

0
0

-2

-2

-2
-2

-2
-2

-2
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-2

-2

08

09

10
07

12
05

11
04

06

20

20

20
20

20
20

20
20

20

Figure 1. Number of Sponsors of the CBAL. Source: adapted from CBA (see Note 82).

sponsors to contribute to the fund. It was successful. They raised more than RMB 10
million (EUR 1.25 million) in a couple of months.55 With the fund, six ‘hope schools’, 50
‘hope libraries’, and 280 ‘hope playgrounds’ were built in poor provinces such as
Xinjiang, Xizang, Guangxi, Yunnan, Hunan, etc., within four years beginning in 2006.56
However, with the closure of the NSP in late 2009 and the return of Xin Lancheng’s
‘elite-sports-prioritized’ governing principle, these grassroots basketball campaigns were
replaced by a ‘Further Building Chinese Basketball Reserve Pool Project’ in 2010, which
aims to help building the elite basketball reserve pool rather than developing Chinese mass
basketball.57 Nevertheless, the CBAL’s market gradually emerged under the NSP and
keeps expanding even after the closure of the NSP in 2009. The following section will take
a look at the current strength and weakness of the NBA’s market and the CBAL’s market.

McDonald’s or Shanghai Food?


Current Degree of the NBA’s Market Growth
As a pioneer of new global capitalists, the NBA is among those American-made cultural
exports, which were successfully and continually taken to the world after the Cold War.
In today’s China, the NBA’s market is far more influential than that of the CBAL. It is
reported that the NBA’s total revenues from broadcasting rights, branded product sales, and
sponsorships in China were roughly USD 50 million (EUR 37.5 million) to USD 70 million
(EUR 52.5 million) during 2005 to 2009, compared to approximately USD 15 million (EUR
11.25 million) for the CBAL.58 Nevertheless, the NBA’s revenue in China is tiny compared
with the USD 4 billion (EUR 3billion) or so the league earns each year in the USA. ‘We are
just scratching the surface in China,’ one staff of NBA China said. For the NBA, doing
business in China might not be as easy as they expected. There are some disadvantages that
the NBA finds it hard to overcome: (1) few Chinese players are capable enough to be
recruited by NBA teams; (2) there is less governmental support in China; and (3) what the
NBA can localize in China is a commercial brand, not a tangible league.59
When talking about the Chinese players’ capability to be recruited by NBA teams, the first
point is evident by noting the impact of the Chinese players on the NBA’s popularity in China.
The statistics from HoopChina.com show that at least 58.7% of basketball fans (2003–2010)
and 56.6% of sports fans (2003–2010) started following the NBA games after Yao Ming
became a player in the NBA.60 The survey also found that the NBA’s fan base was steadily
The International Journal of the History of Sport 1329
9

expanding until 2007, then the number of new fans decreased by over a half between 2007 and
2010, due to Yao’s injury in early 2009. A sudden dramatic increase occurred when Yao came
back to the court at the beginning of 2010. But it started to drop again after another injury to
Yao.61 On the contrary, CCTV-5 tended to broadcast more CBAL games than NBA games in
reaction to Yao’s retirement in 2011 and Yi Jianlian’s return to Guangdong Hongyuan
Basketball Club in 2012. Therefore, the NBA has to hard-sell Jeremy Lin, a Taiwanese
descendant. But it seems that the Chinese fans are not interested; indeed, few of the
respondents – basketball-playing supporters or basketball-consuming supporters – felt that
the NBA’s promotion of Jeremy Lin would affect their interest in NBA games.
The second disadvantage of the NBA – lack of governmental support – is also
evident. And there are also some lessons the NBA needs to learn about doing business in
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China, as illustrated in the following two stories told by Li Yuanwei:


For example, during the 2008 NBA China Games, David Stern wished to pay a visit to a state
leader who was in charge of sport policy in the State Council. The secretary office serving this
leader agreed to Stern’s request, but required him to do some necessary paperwork first.
However, after the NBA finished and submitted all the required documents, his application
was rejected because the NBA’s proposal didn’t fulfill the minimum requirement for being
received by this state leader, which was regulated by the central government. This irritated
Stern and he took the earliest flight back to America.62
...
To give another example, the NBA was stopped from selling all the tickets for the 2008 NBA
China Games by the Beijing Public Security Bureau for the reason of ‘hindered security’. The
NBA’s arrangement of holding a celebration between Chinese fans and NBA players on the
court was stopped again for the same reason . . . Security is one reason, however, the more
important reason was that the NBA didn’t even tip its hat to the Beijing Municipal
Government (which leads the Security Bureau) before the organization of the 2008 NBA
China Games.63
The NBA’s lack of governmental support overlaps with its third disadvantage – failing to
establish itself within China. Resulting from the two aforementioned disadvantages, the
NBA understands the significance of ‘localizing’ their own games in the Chinese market.
However, both of the NBA’s two strategies for establishing itself, which were to bid to
become the commercial agent of China’s national teams, Team China, in 2006, and to set up
a professional basketball league in China in 2008, were rejected by the CBA. With regard to
the bidding to become commercial agent, Infront and the NBA were the two most promising
bidders. On the side of Infront, which was the commercial agent of the CBAL, it was their
eagerness to win the bid so as to maximize their benefits in cooperating with other sponsors.64
On the other side, the NBA had mapped the Chinese market out as their core target in their
global plan. Thus, the NBA offered a high bid of USD 10 million (EUR 7.5 million) in
sponsor fees to the CBA.65 Li Yuanwei stated that the CBA had been close to doing a deal
with the NBA, but had finally picked Infront as they could not get over their doubts about the
insecurity that the NBA might arouse in the Chinese basketball market. He stated:
Imagine, if the NBA takes control of Team China and the CBAL one day in terms of commercial
operation, the CBA and Chinese basketball will be vassals of the NBA. We can’t accept such
consequences. But the possibility is potentially out there. Since the implementation of the
‘reform and opening-up’ policy, a lot of local brands want to exchange technology and money
with their market through co-operation with international brands, but some of them lose their
market whereas little technology has been gained, some even disappear from the market after
the so-called co-operation. It is an alert for Chinese basketball.66
As for setting up a China-based basketball league, the NBA’s proposal was strongly
rejected by the CBA. In April 2008, the NBA hired McKinsey & Company Inc. at a cost of
1330
10 L. Luo et al.

USD 1 million (EUR 0.75 million) to project the NBA China league.67 According to the
proposal, the league would copy the NBA’s operation model and would recruit players and
enrol clubs from other Asian countries. Current CBAL clubs would have priority to join
the league with an entrance fee of USD 50 million (EUR 37.5 million). The naming rights
would be in the hands of the CBA.68 The NBA and the CBA would each hold a half-share.
But for the CBA, this project was totally not making sense, as Li stated:
This project was definitely with an American logic, and it was totally impractical in the land of
China. Imagine, if the new league was formed, then how to deal with the CBAL? And the
NBL (est. 2005), or other marketing partners? Also, it was impossible for the CBAL clubs to
join the league. I don’t think there are any CBAL clubs that could afford that money. Even if
they have that money, it would be at a likely risk for them to lose money.69
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Current Degree of the CBAL’s Market Growth


On the contrary, the CBAL admittedly remains quasi-professionalized. Moreover, this
league can hardly compare to the NBA in terms of product quality and commercial
operations. However, despite the NSP being somewhat a duplication of the NBA, it has
successfully pushed the CBAL market further.70 As Li argued:
Although I don’t regard the CBAL as a veritable professional sports league, it is undoubtedly
the best sports league in China. Learning from the NBA is our magic weapon. In other words,
our strategy of ‘Nalai Zhuyi’ from the NBA has propelled the CBAL to the No. 1 professional
sports league upon the football league within only a couple of years.71
Furthermore, although the demise of the NSP in 2009 has somewhat slowed down the
marketization of Chinese basketball, there are still some advantages for the CBAL in
coping with the NBA’s mighty business expansion in China. Above all, as a reverse global
labour flow, the CBAL is benefiting from increasing arrivals of high-quality international
players, particularly from the NBA. The CBAL is now a major destination for out-of-
contract NBA players, which has greatly improved the quality of CBAL games.
International players have been playing a significant role in the roster of many CBAL
teams since the league began. In the first season, Zhejiang Team imported the first ever
international player in Chinese basketball history, Mikhail Safin. This Uzbekistan player
helped the Zhejiang Team, a newly promoted team from the Yiji League, to gain
qualification to play in the Jiaji League with a ranking of sixth.72 Since then, all CBAL
clubs except the Bayi Army have imported a great number of international players in their
roster. In the late 1990s, on average, less than 20 international players each season were
hired by CBAL teams, which increased to double this figure from the 2000s due to the
CBA allowing substitutions of international players during a season.73 The quality of those
international players has also improved a lot during the past decade. At the beginning of
the league, most international players were from Eastern Europe or from the USA, who
were not qualified to play in the NBA. But in recent years, most of the international players
in the CBAL have experience of playing in NBA teams. More and more NBA players, and
coaches, are being hired by CBAL clubs, even star players such as former first-pick player
Steve Francis and Kenyon Martin, as well as former NBA MVP Tracy McGrady. Stephen
Marbury, in particular, has been playing in the CBAL since 2009 and has recently brought
the Beijing Ducks a heroic championship title over the Guangdong Hongyuan Basketball
Club. To express their high appreciation, 1.02 million basketball fans signed to build a
bronze statue of Marbury in front of the Wu Ke Song Stadium Square, in 2012.
Moreover, there are some inherent advantages for the CBAL in consolidating its market.
First, it holds a geographical advantage compared to the NBA. The CBAL games are played
The International Journal of the History of Sport 1331
11

during prime time, which suits all kinds of Chinese audiences. Most NBA games are shown
in the morning (Beijing time) when most audiences are not available to watch these games
through either television or the Internet. Second, a great number of NBA supporters in China
are in fact following Chinese players. When these Chinese players stop playing in the NBA,
such followers are likely to turn their eyes back to the CBAL. Apart from the case of Yao
Ming, discussed previously, there has been another case with the recent return of Yi Jianlian
for the 2012–2013 season. With Yi rejoining the Guangdong Hongyuan Basketball Club,
the number of CBAL games broadcast by CCTV-5 has increased to seven, more than twice
the last year’s number.74 Before that, only one game was live on Wednesday, Friday, and
Sunday respectively. Since the 2012–2013 season, Tuesday, Wednesday, Friday, and
Sunday have one game live, plus three games broadcast during the week.75 Third, the CBAL
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games will never be eliminated or replaced by the NBA’s presence, since they are local
games from within China which could help preserve local and Chinese supporters. Beneath
the conspicuous nationalism in Chinese sport from a global or international perspective,
there also exists a force of ‘sport regionalism’, which is stimulating the formation of a CBAL
fans community.76 From the interviews with basketball supporters, it is found that it has been
almost uniform that the CBAL followers tend to support their local clubs, which are usually
former provincial teams. This phenomenon is a remnant from the pre-professional era.
Therefore, the indigenous basketball market does not shrink but keeps expanding in
the post-NSP seasons. During the 2011 –2012 season, the attendance rate achieved
77.82%; CCTV-5 broadcast 51 games live and 67 recorded, 23 local television
broadcasters transmitted 1614 games and the Finals achieved a television rating of 1.83%,
which was higher than the NBA and was top to all sports programmes broadcast
throughout the year. All these figures are historical highs.77 The brand value of the CBAL
also keeps rising. In 2004, Anta offered only RMB 10 million (EUR 1.25 million) to be the
chief sponsor. But, in 2010, when Nike signed to sponsor only the basketballs in
the games, it cost RMB 20 million (EUR 2.5 million).78 In 2012, Li-Ning signed to be the
chief CBAL sponsor, paying RMB 2 billion (EUR 250 million) for a five-year contract.79
These figures all reflect that the CBAL market is potential and attracting various marketers
to put investment into.
In sum, the global – local interplay between the NBA and the CBAL has been
expanding the Chinese basketball market. As Li Yuanwei commented:
I totally agree that the NBA has contributed greatly to expanding the capacity of the Chinese
basketball market and the development of basketball in China. They have also provided us
with a great deal of resources and experience in professionalizing Chinese basketball.
The market for basketball here in China is big enough to accommodate both the NBA and the
CBAL. So I see the NBA’s presence in China is an opportunity for both of us to make a big
cake, rather than a threat of invading Chinese basketball market.80
He further echoed his words to David Stern when he rejected the NBA’s proposal for
building a NBA-like professional basketball league in China, ‘McDonald’s is popular in
Shanghai, but it doesn’t affect the business of Shanghai food’.81

Conclusion
In the economic dimension, the study has revealed that the worldwide spread of capitalism
and commercialism has resulted in the expansion of the Chinese basketball market.
The NBA’s growing business in China has not overwhelmed the local market. In actuality,
Chinese basketball has successfully achieved further commodification and benefited from
the adaption of the NBA’s certain forms of capitalistic operations for profit. Emulation
1332
12 L. Luo et al.

from the NBA’s marketing strategies in governing Chinese professional basketball has
proved to be practical.
In the Jiaji League period, Chinese professional basketball was run with an emphasis
on winning/performance, but the league was not properly marketized. The limited ways
that the league could generate income were selling commercial rights to sports agents or
selling the league’s naming rights by themselves. In contrast, under the NSP, the CBAL
learned from the NBA’s marketing principles to transform their predecessors’
competition-focused basketball into basketball for entertainment and profit. A key
marketing strategy named ‘One Focus and Three Services’ was proposed. It focused on
branding the league and serving the interests of the fans, the media, and the sponsors, as in
the NBA. Since then, a local basketball market has been rising gradually. With regard to
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market share, the NBA has certain disadvantages despite the strength of its position in
China. These include the participation of few Chinese NBA players, a lack of
governmental support, and the failure to create a tangible league. The market for the
CBAL is expanding, despite the low-quality competitions, owing to certain inherent
advantages: the arrival of high-level international players and the return of Chinese NBA
players, prime time broadcasting hours, and its ability to appeal to the local tastes of
regional followers.

Notes on Contributors
Lin Luo is a Professor at the School of Physical Education and Sports, Jiangxi Normal University,
China. His main research interests are basketball culture and leisure sports.
Yongguan Dai is an Associate Professor at the School of Physical Education and Sports, Jiangxi
Normal University, China. His main research interests are basketball culture and sport policy in post-
reform China.
Fuhua Huang is a Lecturer at the School of Physical Education and Sports, Jiangxi Normal
University, China. His main research interests are globalization and sport, professionalization, and
commercialization of sport, sport history, and traditional sports in China.

Notes
1. B. Wong, J. Chen, S. Han, Z. Chen, and J. Lian, ‘Globalization and Chinese Sports Industry.’
Sports Culture Guide no. 10 (2004), 37 – 39; X. Chen, ‘Basketball Culture and Market’
(PhD diss., Soochow University, 2007); X. Zhang, Y. Zhang, B. Shi, and K. Zhang, ‘The
Internationalization of Sport Agency and the Countermeasures of Chinese Market’, Journal of
Wuhan Institute of Physical Education, no. 6 (2000), 19 – 22.
2. G. Ritzer, The Blackwell Companion to Globalization (Hoboken, New Jersey: Wiley-
Blackwell, 2007), 21.
3. Ibid., 22.
4. H. Jiang and H. Zhang. Annual Report on Development of China’s Sports Industry (2008 –
2010) (Beijing: Social Science Academic Press, 2010), 77.
5. Ibid.
6. Ibid.
7. E. Schwarz, and J. Hunter. Advanced Theory and Practice in Sport Marketing (London and
New York: Routledge, 2012), 3.
8. F. Huang, ‘Glocalisation of Sport: The NBA’s Diffusion in China’, The International Journal
of the History of Sport 30, no. 3 (2013), 267– 84.
9. Ibid.
10. CBA, ‘Financial Statistics of the 1995– 1996 Season 555 China Men’s Basketball Jiaji
League’, Chap. Beijing: Chinese Basketball Association (Internal Document), 1996.
The International Journal of the History of Sport 1333
13

11. CBA, ‘Financial Statistics of the 1995– 1996 Season 555 China Men’s Basketball Jiaji
League’, 1996; CBA, ‘Financial Statistics of the 1996– 1997 Season Hilton China Men’s
Basketball Jaiji League’, Chap. Beijing: Chinese Basketball Association (Internal Document),
1997; CBA, ‘Financial Statistics of the 1997– 1998 Season Hilton China Men’s Basketball Jiaji
League’, Chap. Beijing: Chinese Basketball Association (Internal Document), 1998; CBA,
‘Financial Statistics of the 1998– 1999 Season Hilton China Men’s Basketball Jiaji League’,
Chap. Beijing: Chinese Basketball Association (Internal Document), 1999; CBA, ‘Financial
Statistics of the 1999 – 2000 Season Hilton China Men’s Basketball Jiaji League’,
Chap. Beijing: Chinese Basketball Association (Internal Document), 2000; CBA, ‘Financial
Statistics of the 2000 – 2001 Season Hilton China Men’s Basketball Jiaji League’,
Chap. Beijing: Chinese Basketball Association (Internal Document), 2001.
12. D. Li, ‘Speech on the 1998– 1999 Jiaji League Review Meeting’, Chap. Beijing: Chinese
Basketball Association, 1999.
13. CBA, ‘Financial Statistics of the 2001 –2002 Season Motorola China Men’s Basketball Jiaji
Downloaded by [University of California, San Diego] at 04:52 02 January 2016

League’, Chap. Beijing: Chinese Basketball Association (Internal Document), 2002.


14. T.-C. Tan, ‘Chinese Sports Policy and Globalisation: The Case of the Olympic Movement,
Elite Football and Elite Basketball’ (PhD diss., School of Sport, Exercise and Health Sciences,
Loughborough University, 2008).
15. Tan, ‘Chinese Sports Policy and Globalisation’; CBA, ‘Financial Statistics of the 2001– 2002
Season Motorola China Men’s Basketball Jiaji League’, 2002.
16. CBA, ‘Financial Statistics of the 1995– 1996’; CBA, ‘Financial Statistics of the 1996– 1997’.
17. CBA, ‘Financial Statistics of the 1997– 1998’.
18. CBA, ‘Financial Statistics of the 1998– 1999’.
19. CBA, ‘Financial Statistics of the 1999– 2000’.
20. CBA, ‘Financial Statistics of the 2000– 2001’; CBA, ‘Financial Statistics of the 2001– 2002’.
21. CBA, ‘Financial Statistics of the 2001– 2002’; CBA, ‘Financial Statistics of the 2002– 2003
Season Motorola China Men’s Basketball Jiaji League’, Chap. Beijing: Chinese Basketball
Association (Internal Document), 2003.
22. CBA, ‘Annual Report of the 2003– 2004 CBAL Season’, Chap. Beijing: Chinese Basketball
Association (Internal Document), 2004.
23. CBA, ‘North Star Project: The Ten Years’ Reform of Chinese Professional Basketball
(2005– 2014)’, Chap. Beijing: Chinese Basketball Association (Internal Document), 2004.
24. Y. Li, ‘Speech on the 2nd Chinese Basketball Culture Forum’, Chap. Chinese Basketball
Research Center: Digital Database (Internal Document), 2007.
25. CBA, ‘Annual Report of the 2003 –2004 CBAL Season’, 2004.
26. Li, ‘Speech on the 2nd Chinese Basketball Culture Forum’.
27. Ibid.
28. CBA, ‘Annual Report of the 2004– 2005 CBAL Season’, Chap. Beijing: Chinese Basketball
Association (Internal Document), 2005.
29. Ibid.
30. Ibid.
31. CBA, ‘Annual Report of the 2005– 2006 CBAL Season’, Chap. Beijing: Chinese Basketball
Association (Internal Document), 2006.
32. CBA, ‘Annual Report of the 2006– 2007 CBAL Season’, Chap. Beijing: Chinese Basketball
Association (Internal Document), 2007.
33. CBA, ‘Annual Report of the 2007– 2008 CBAL Season’, Chap. Beijing: Chinese Basketball
Association (Internal Document), 2008.
34. CCTV-5, ‘Inauguration of the 2004– 2005 CBAL Season’, 14 November 2011.
35. CBA, ‘North Star Project’.
36. Li, ‘Speech on the 2nd Chinese Basketball Culture Forum’, 2007.
37. Ibid.
38. Ibid.
39. CBA, ‘North Star Project’.
40. G. Ma, ‘Speech on the 30th China International Sporting Goods Show 2012,’ Chap. Chinese
Basketball Research Center: Digital Database (Internal Document), 2012.
41. CBA, ‘North Star Project’.
42. CBA, ‘Annual Report of the 2005 –2006 CBAL Season’.
1334
14 L. Luo et al.

43. CBA, ‘Annual Report of the 2005– 2006 CBAL Season’; CBA, ‘Annual Report of the
2006– 2007 CBAL Season’.
44. CBA, ‘Annual Report of the 2004– 2005 CBAL Season’; CBA, ‘Annual Report of the
2005– 2006 CBAL Season’; CBA, ‘Annual Report of the 2006– 2007 CBAL Season’.
45. Li, ‘Speech on the 2nd Chinese Basketball Culture Forum’.
46. Ibid.
47. CBA, ‘Annual Report of the 2004 –2005 CBAL Season’.
48. Jiang and Zhang, Annual Report on Development of China’s Sports Industry (2008 – 2010),
467.
49. Ibid., 458– 67.
50. Ibid.
51. Ibid.
52. Ibid., 466.
53. CBA, ‘Annual Report of the 2004 –2005 CBAL Season’.
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54. Li, ‘Speech on the 2nd Chinese Basketball Culture Forum’.


55. CBA, ‘Annual Report of the 2005– 2006 CBAL Season’; CBA, ‘Annual Report of the 2006–
2007 CBAL Season’; Li, ‘Speech on the 2nd Chinese Basketball Culture Forum’.
56. Ibid.
57. L. Xin, ‘Speech on the 2008 –2009 CBAL Season Review Meeting’, Chap. Beijing: Chinese
Basketball Association, 2009; L. Xin, ‘Speech on the 2009– 2010 CBAL Season Review
Meeting’, Chap. Beijing: Chinese Basketball Association, 2010.
58. M. Bao, ‘Speech on the 3rd Chinese Basketball Culture Forum’, Chap. Chinese Basketball
Research Center: Digital Database (Internal Document), 2011.
59. Huang, ‘Glocalisation of Sport’, 267– 84.
60. HoopChina, ‘HoopChina Sports Research Report: Yao’s Impact on China’s Sports Industry,’
Chap. Beijing: HoopChina.Com, 2011, quoted in Huang, ‘Glocalisation of Sport: The NBA’s
Diffusion in China’, 267– 84.
61. Ibid.
62. Li, ‘Speech on the 3rd Chinese Basketball Culture Forum’.
63. Ibid.
64. Li, ‘Speech on the 3rd Chinese Basketball Culture Forum’; CBA, ‘Annual Report of the
2006– 2007 CBAL Season’.
65. Ibid.
66. Li, ‘Speech on the 3rd Chinese Basketball Culture Forum’.
67. Ibid.
68. Ibid.
69. Ibid.
70. Huang, ‘Glocalisation of Sport: The NBA’s Diffusion in China’, 267– 84.
71. Li, ‘Speech on the 3rd Chinese Basketball Culture Forum’.
72. X. Chen, ‘Basketball Culture and Market’ (PhD diss., Soochow University, 2007); C. Shi,
‘A Study on the Path-independence of Chinese Professional Basketball Leagues’ (PhD diss.,
Shanghai University of Sport, 2009).
73. Ibid.
74. CBA, ‘Annual Report of the 2012– 2013 CBAL Season’, Chap. Beijing: Chinese Basketball
Association (Internal Document), 2013.
75. CBA, ‘Annual Report of the 2012 –2013 CBAL Season’.
76. T. Hua, ‘Football “Hooligans” and Football Supporters’ Culture in China’, in J. Horne, and
W. Manzenreiter (eds), Football Goes East: Business, Culture and the People’s Game in
China, Japan and South Korea (London and New York: Routledge, 2004), 87 – 101.
77. CBA, ‘Annual Report of the 2011 –2012 CBAL Season’.
78. Ibid.
79. Ibid.
80. Ibid.
81. Y. Li, ‘Speech on the 3rd Chinese Basketball Culture Forum’, 2011, quoted in Huang,
“Glocalisation of Sport: The NBA’s Diffusion in China”, 267– 84.
82. CBA, ‘Annual Report of the 2003– 2004 CBAL Season’; CBA, ‘Annual Report of the
2004– 2005 CBAL Season’; CBA, ‘Annual Report of the 2005– 2006 CBAL Season’; CBA,
‘Annual Report of the 2006– 2007 CBAL Season’; CBA, ‘Annual Report of the 2007– 2008
The International Journal of the History of Sport 1335
15

CBAL Season’; CBA, ‘Annual Report of the 2008– 2009 CBAL Season’, Chap. Beijing:
Chinese Basketball Association (Internal Document), 2009; CBA, ‘Annual Report of the
2009 – 2010 CBAL Season’, Chap. Beijing: Chinese Basketball Association (Internal
Document); CBA, ‘Annual Report of the 2010 –2011 CBAL Season’, Chap. Beijing: Chinese
Basketball Association (Internal Document), 2011; CBA, ‘Annual Report of the 2011– 2012
CBAL Season’, Chap. Beijing: Chinese Basketball Association (Internal Document), 2012.
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