The deadline for extending Brandon Knight and the rest of the 2011 first round ended Friday, and a number of guys were left smiling after signing new four-year deals. Among them: Klay Thompson ($70 million), Ricky Rubio ($56 million), Kemba Walker ($48 million) and Alec Burks ($42 million). Not among them: Brandon Knight, who instead will be a restricted free agent next summer. So how close were the Bucks to making a deal?
Brandon Knight and the Bucks will not get a deal done, but sources told ESPN that the sides weren't all that far apart.— Jeff Goodman (@GoodmanESPN) October 31, 2014
Source close to negotiations tells me there was a "significant gap" in Brandon Knight extension talks.— Gery Woelfel (@GeryWoelfel) November 1, 2014
So there you have...uh, well, something.
As we've been saying for a while, this outcome probably makes sense for everyone. Sure, Knight and every other young player would love to lock in a big money deal (being set for life is cool, right?), but the likelihood of a spiking cap in 2016 has given every agent reason to be wary of signing for what we previously thought were "market" rates. In short, don't even think about citing Stephen Curry's $11 million a year extension from 2012 when discussing point guard deals going forward. At this point we're in a different salary paradigm (not to mention that Curry was also considered a long-term injury risk when he signed), which means that Knight's agent Arn Tellem may well have been looking for something in ballpark of Walker's $12 million annual salary--and likely a couple million north of what the Bucks might have been willing to do. Doesn't hurt to ask, especially given that the 22-year-old Knight will have every opportunity to put up huge numbers this season. The downside risk is injury or poor play, but the latter seems less likely given his age and the increased talent around him.
On the flip side, the Bucks also didn't have a powerful incentive to scramble for a deal just to get one done with a player whose ultimate value in the league remains unclear. So while the Bucks seem to like Knight (probably not love), they're also not in imminent danger of losing him next summer. As we saw with Eric Bledsoe this past summer, the market for restricted free agent point guards can be a complicated one; the league's glut of young point guards means that few teams are in desperate need of a guy like Knight, and even the ones that could use a young guard (hello, Knicks!) might well prioritize other guys in their free agent wishlist. That means it's not out of the question that the Bucks may well only be bidding against themselves next summer even if Knight plays extremely well. That's what happened to Bledsoe, though he still ended up nabbing a huge deal by threatening to take his one-year qualifying offer (which would have made him a free agent in 2015). The QO scenario is always the ultimate fallback for RFAs, and in the end Bledsoe's camp did well getting the Suns to come off their four year, $48 million offer and bump it all the way up to five years and $70 million.
The Bucks could find themselves in a similar standoff with Knight next summer, or they could be forced to decide whether or not to match a big money offer for Knight from another team. Such is life in a world without certainty (ie the world we live in). There's always a risk that a young player breaks out and gets a much bigger deal than he would have accepted the previous summer (Gordon Hayward is a good example), but that's all part of the calculation for teams, and the increased certainty of seeing a player for another year is worth something too. Would you rather commit $12 million annually for a 22-year-old who might become a really good player, or would you rather wait a year and pay him $15 million only if he actually becomes really good? As any investor knows, options have value, and the Bucks effectively have one with Knight. Knight's early season numbers have been impressive, but there's plenty of season left as well.
Other considerations also come into play. With potential franchise talents, there's an argument for maxing a guy out ahead of time as a matter of faith; that was the argument in favor of the max deals that John Wall and DeMarcus Cousins got in 2013. In theory the Wizards and Kings could have taken the financially less risky approach of letting each hit free agency--the worst that could happen was they get a max deal and match it, right? But the internal politics and motivational factor of forcing a guy to go to restricted free agency isn't trivial either, and both the Kings and Wizards didn't want to risk that with their best players. It's a debatable strategy, but it worked out for both Sacramento and Washington. It's a bit different with a guy like Knight, since no one is really expecting him to be a franchise player or perennial all-star. So yeah, you want him to be happy and feel respected, but...well, not to the point of giving him a huge contract prematurely. And as for whether Knight will now have an incentive to put up big offensive numbers at the cost of defense, passing, etc...well, there's always that possibility. But Knight also seems to have a chip on his shoulder about ongoing criticism of his passing and point guardiness (new word), and I don't think Knight is your typical "contract year" type of guy anyway. He wants to score and he wants to be a star, but I think that would be the case regardless of his contract situation.
There's also the question of preserving cap flexibility, which might not be a huge consideration for the Bucks at this point, but isn't necessarily trivial either. As a restricted free agent, Knight will have a cap hold just shy of $9 million; if he had signed an extension for more than that it would have reduced the Bucks' cap space next July 1. In short: Life is complicated, and so is restricted free agency. But that's not necessarily a bad thing.