NBA Stars Study Hollywood's Playbook in China

James Harden of the Houston Rockets meets fans at Tianhe Sports Center in Guangzhou during his Adidas-sponsored tour of China in June. Photo: Visual China Group/Getty Images

The first time James Harden apologized to China, it had nothing to do with Hong Kong protests, Beijing’s pressure on the NBA or upholding the pillars of democracy. It was all because of an unfortunate scooter incident.

One of the world’s most powerful economies rolled out the red carpet for one of the NBA’s best players when the Houston Rockets superstar visited China this past summer. Mr. Harden wore the flamboyant robes of Peking Opera dress to honor the local culture, and Chinese kids wore beards to honor his marvelous facial hair. It was yet another successful promotional tour hawking Adidas sneakers.

And then he was pulled over by Shanghai police. Mr. Harden was caught riding an electric scooter the wrong way on a local street, a common mistake for an unsuspecting foreigner. He knew what to do next.

“I would like to apologize for violating traffic rules during my scooter ride today,” Mr. Harden wrote on Weibo, the Chinese equivalent of Twitter.

He would find himself in a remarkably similar position this week: apologizing to China for an offense that most people in the U.S. would not find offensive.

The NBA’s showdown in China isn’t simply about how business works in the world’s largest autocracy. It’s also about how celebrities manage their lucrative global brands, with NBA stars now among the world’s most recognizable figures. These players are now absorbing an unofficial Chinese rulebook for public figures that Hollywood celebrities have been studying for the past 20 years.

The NBA was thrust into the eye of a geopolitical storm this week with a quickly deleted tweet by Rockets general manager Daryl Morey supporting protests in Hong Kong. The tweet drew the wrath of China’s government, and Chinese fans quickly cut ties with one of the country’s most popular NBA teams. The NBA’s response, which supported freedom of expression but acknowledged the offense it caused, was attacked in the U.S. as an insufficient defense of free speech and in China as an insufficient apology.

LeBron James of the Los Angeles Lakers shoots against the Brooklyn Nets during a preseason game as part of the 2019 NBA Global Games China in Shanghai on Oct. 10. Photo: Lintao Zhang/Getty Images

The players had their own economic interests in China to worry about. LeBron James, who was stuck in China this week as the crisis unfolded, has a lifetime endorsement deal with Nike that his business partner has suggested is worth more than $1 billion. He’s also the producer and star of “Space Jam 2,” which is expected to have enormous international commercial appeal when it’s released in 2021.

Mr. Harden, who has a $200 million sneaker contract with Adidas, met with the media along with his teammate Russell Westbrook as tensions mounted this week. They suddenly faced a dilemma that would have been tricky even for a trained diplomat. Once again Mr. Harden said he was sorry.

“We apologize,” he said. “We love China. We love playing there. For both of us individually, we go there once or twice a year. They show us the most important love. We appreciate them as a fan base, and we love everything they’re about.”

The NBA’s stumble in China has a dramatic prequel: Hollywood’s early foray into the Chinese market came with its own collisions of free speech and authoritarian politics with billions of dollars at stake.

The movie business’s big flare-up came in 1997, when two movies about a young Dalai Lama premiered in the U.S., Sony Pictures Entertainment’s “Seven Years in Tibet” and Walt Disney Co. ’s “Kundun.” The Chinese box office was an afterthought to Hollywood studios at the time, only a handful of movies were imported each year, but China made it clear it did not appreciate Hollywood producing sympathetic portrayals of the Dalai Lama, who has represented a challenge to Chinese sovereignty for decades since the Buddhist leader was forced to flee Tibet in 1959.

The studios found themselves in a similar lose-lose situation as the NBA. If they bowed to China’s demands, they risked angering Americans who saw it as a curtailing of free speech. But if they released the movies as planned, they faced the possibility of larger business pursuits in the country going nowhere.

The movies were released within a few months of one another, and Beijing made good on its threat. Sony and Disney movies were rejected from entering the country. The message from Beijing: If you want our money, stay out of our internal affairs.

Both studios eventually caved to China by apologizing profusely. Sony sent a delegation of executives to meet with government officials and smooth things over. Disney CEO Michael Eisner met with Chinese Premier Zhu Rongji the following year. “We made a stupid mistake,” Mr. Eisner said, according to a transcript of the meeting. “The bad news is that the film was made; the good news is that nobody watched it. Here I want to apologize, and in the future we should prevent this sort of thing, which insults our friends, from happening.”

Hollywood’s groveling worked. Sony and Disney movies were soon flowing into China again.

The political considerations of doing business in China were quickly baked into Hollywood strategy. Stars promoting new movies in Shanghai and Beijing are now given a list of Do’s and Don’ts for taking questions. Answers that show an affinity for the local culture are preferred. Tibet and Tiananmen Square are strictly taboo.

Celebrities have learned the hard way what happens if they slip up. When Angelina Jolie was promoting Disney’s “Maleficent” in Shanghai in 2014, she was asked who her favorite Chinese director was.

Actress Angelina Jolie promotes ‘Maleficent’ in Shanghai in 2014. A comment she made about director Ang Lee’s nationality on that trip angered the public. Photo: Visual China Group/Getty Images

“I am not sure if you consider Ang Lee Chinese, he’s Taiwanese, but he does many Chinese-language films with many Chinese artists and actors,” she said. The mere suggestion of doubt that Taiwan is part of China angered the public, prompting some calls to boycott Ms. Jolie’s movies. China did allow Ms. Jolie’s then-husband Brad Pitt into the country for the first time since the “Tibet” film, but he stayed out of sight. Ms. Jolie told reporters he was learning to make dumplings.

NBA stars are navigating similar dilemmas today. The best players have deals with shoe companies worth hundreds of millions of dollars, in part because China is the biggest source of growth in the sneaker industry. By taking a stance against Beijing, they can alienate the entire market. The problem is that they have projected themselves as public ambassadors in recent years, sharing their opinions on political issues that hit close to home.

“I can’t imagine the pressure the players feel at this point knowing what they can and can’t say,” said Matt Halfhill, the founder of the sneaker news site Nice Kicks.

This generation of NBA players, who were born around the time the league began airing on Chinese state-run television, has been conditioned to view this authoritarian state as an important partner, said Sonny Vaccaro, a longtime sports-marketing executive. NBA commissioner Adam Silver liked to brag that more basketball was being played and watched in China than anywhere else in the world. The three most popular jerseys in China last year belonged to LeBron James (Nike), Stephen Curry ( Under Armour ) and James Harden (Adidas), while Chinese apparel brands Anta, Li Ning and Peak have their own endorsement deals with NBA players.

Some players, like Mr. James of the Los Angeles Lakers, have Hollywood interests to worry about as well. Mr. James’s production company, SpringHill Entertainment, has more than a dozen film and television projects in development. The company just wrapped production on “Space Jam 2,” a sequel to the 1996 animated hit starring Michael Jordan and cartoon characters like Bugs Bunny. At AT&T Inc. ’s Warner Bros., the movie is considered a likely candidate for distribution in China, where basketball has a huge fan base, according to people familiar with the matter.

Mr. James could jeopardize that effort and stoke China’s wrath with one slip of the tongue because the off-screen conduct of celebrities often matters as much to state censors as what’s on screen. When Lady Gaga met with the Dalai Lama in 2016, Chinese fans lashed out at the singer on social media, and authorities ordered her music off streaming services.

The NBA set its sights on China’s potential at a time when the country’s middle class—about the size of the entire U.S. population—was moving to cities, using the internet to learn about Western movie stars and athletes and dramatically opening itself to the world.

But no business takes off in China without the tacit support of the government. Beijing authorities issued a decree in 2014 designed to boost the country’s sports and exercise industries, with the goal that 500 million Chinese citizens would be playing sports by 2025. And there were few sports more important to this plan than basketball.

“Carry forward the Olympic spirit and the spirit of Chinese sports, and practice the core values of socialism,” the decree stated.

It might seem like wishful thinking to order more than a billion people to work out more, but such legislation often serves as a greenlight to businesses to invest in those sectors. The flood of Chinese money into Hollywood around 2013 was prompted in part when the government included arts and overseas investment as priorities in official plans. The sports guidelines reduced the corporate income tax for sports companies, loosened regulation around sports development and encouraged the purchase of broadcast rights for games.

True success in China comes when a commercial craze overlaps with a government mandate, and the NBA’s move into China was routinely cited by other industries as the smoothest of any Western brand—at least until this week.

James Harden answers a question after the NBA Japan Games 2019 pre-season basketball match between the Houston Rockets and Toronto Raptors on Oct. 10. Photo: toshifumi kitamura/Agence France-Presse/Getty Images

After his apology and declaration of love for China, Mr. Harden is still a draw on Shanghai’s main shopping avenue, where a looping video of him was the featured display in Adidas’s flagship store this week. When he was asked Thursday whether he felt comfortable speaking on political events in the future, a spokeswoman for the Rockets answered as he remained silent.

“Basketball questions only,” she said.

The NBA canceled the remaining media sessions for players and coaches in China the next day.

Corrections & Amplifications
James Harden plays for the Houston Rockets. An earlier version of this article misspelled his name in a caption. (Oct. 12, 2019)

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