November 28 2007: 7:13 AM EST
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LeBron Inc. (page 4)

The building of a billion-dollar athlete.

By Tim Arango, Fortune writer

It's easy to think that global superstardom at the level to which James aspires happens organically, that performance and charisma magically align to catapult an athlete to icon status. That may have been the case with, say, Muhammad Ali, but LRMR is not leaving anything to chance. Instead they are approaching LeBron's personality with the same attention to detail that the Manhattan Project reserved for atomic physics.

LRMR is dealing with a different media landscape from what existed in Ali's or even Jordan's era: TV markets are increasingly fragmented. "It's much more difficult to aggregate a television audience today than it once was," says Silver, the NBA's deputy commissioner.

Consider this: Jordan's last game with the Bulls in 1998 - game six of the NBA Finals - was the highest-rated NBA game in history, drawing in close to 35.9 million viewers, a number that dwarfs the 9.8 million viewers who watched James in this year's deciding game four between the Spurs and Cavaliers. By contrast, this year's American Idol finale drew a little over 30 million viewers.

The NBA, in other words, has yet to recover from its post-Jordan decline, a burden that James is well aware of. "For me as a competitor, I do take the responsibility to bring the game of basketball back," James says. By flicking back the veil on the business operation that is LeBron James, one sees how strategic and deliberate those efforts have to be today.

"From now until the Olympics we're very focused on letting the world get to know LeBron," Carter says in an interview in his Cleveland office, "letting the world know that he's a very simple human, a regular guy who laughs and likes to have fun and enjoys being with his family and friends. When you're looking for longevity, the world has to know who you are for real."

To do this, Carter is trying to get distribution for a documentary that was shot during James's high school days. Also in this vein, James hosted ESPN's Espy awards with Jimmy Kimmel earlier this year and was a guest host on Saturday Night Live in September. The last athlete to grace the show before James was Peyton Manning. Tuning in for him were 7.9 million viewers; 6.1 million did for James.

In one-on-one interviews James tends to be soft-spoken and to rely on the common crutch for athletes: clichés. But when performing, he lights up. Anyone who has seen the Nike ads featuring the LeBrons, a sketch in which James borrows from Eddie Murphy's playbook and portrays four characters (an all-business, a childlike, a wise-old, and a jock version of himself), can see his potential as an entertainer.

At the summit, for example, he stood up and feigned surprise that all the executives would travel to Akron. "I'm just very excited about this," he says. "Who would ever have thought we could get you guys to Akron, Ohio? Growing up, we couldn't get anyone to little ol' Akron, Ohio."

(Of course, when he was in high school, James was one of the most highly touted schoolboy athletes in the country. Sneaker executives and coaches flocked to Akron to see him play, and two of his high school games were broadcast on ESPN.)

To build James's star power, Carter also told his team that he wants more frequent research studies to keep his pulse on the public's view of James. "I want to set it up so we get information about his awareness and what people really feel about him, and I want to do it every six months," he says.

Ultimately, LRMR's future does not rely on research but on James's winning an NBA championship, and in Cleveland's current lineup he is getting little support. This is an issue, because the success of the Cavaliers - who at presstime were playing .500 ball in the early season - will dictate the success of LRMR. For better or worse, James is locked into playing for Cleveland until 2010 at least, based on a contract extension he signed in 2006.

Ohio may be home, but it is not a major media market. And there has been speculation within the league of his moving to New York or Los Angeles when his contract is up.

"But first he has to win" is how Nike Brand president Charlie Denson sums up the key element in James's becoming a true superstar. "He can't get there unless he wins. LeBron knows that."

Aside from being stuck on an also-ran team, there are other potential pitfalls that could bring the enterprise to a crashing halt. One off-the-court indiscretion memorialized on a cellphone camera can dent a reputation and a business; one freak injury could dry up the revenue stream. But Carter is not daunted by the prospect.

"We're building a business that would keep going on," Carter says. "I'm building a name in the business community, and LeBron would still be a name."

Meantime it is full speed ahead on taking LeBron global: On the Tuesday after Labor Day, James and Nike hold their annual business meetings in a sunny conference room in the Tiger Woods Center at Nike's vast campus in Beaverton. (Fifteen athletes have buildings on Nike's campus named for them, but James is not yet one of them.)

Fresh from a summer playing for USA Basketball in Las Vegas, James sits at the center of the table, surrounded by 25 or so Nike executives displaying the upcoming LeBron-branded sneakers and apparel. Even Nike founder Phil Knight pops in and out. One shoe has gold accents to symbolize "fit for a king" - a play on his nickname, "King James."

Wearing baggy shorts, his shoes off, and munching on cookies and M&Ms, James has an air of insouciance, as if he's bored really. But he is actually taking everything in, and he pipes up when he has an opinion or disagrees with something.

When someone proposes pitching a "cross-cultural" story to the media involving LeBron and a Chinese athlete, James is skeptical because it violates his business mantra: "It has to be authentic," he says. "I don't want to do it if it doesn't feel authentic."

Even though a championship ring has eluded James, his postseason performance, the "AGF" of it all, has prompted Nike to reshuffle its basketball division, placing James atop the organization, meaning that more resources will be devoted to marketing and selling James's products. Before the change, about four people within Nike spent most of their time on James. In the new construct, about 150 people will be working on James on a daily basis.

Later that evening on the flight to Los Angeles, while James sleeps in the back of Nike's Gulfstream, the sneaker company's basketball development executive, Merritt, sits up front and reflects on James's place in the pantheon of Nike athletes.

"One of the phrases we used in the meeting today was that he can be an ambassador to his sport like Jordan was," he says, "like Muhammad Ali, like Tiger. I think LeBron can be as big as these guys. How far are we? I think we're at the infant stage."

Now it is up to LeBron to show the world that he can do more than crawl. To top of page

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