NBA owners are losing money. Less than five teams turned in a profit last season. They feel this is mainly due to overspending on players' salaries. While the NBA has a salary cap (the maximum amount a team can spend on all its players; it's set at around 55 million) to prevent overspending, it's a "soft cap," which means certain circumstances allow teams to exceed the cap (this usually includes trades and contract extensions).
Some owners have been giving out superstar contracts to average players (one player received roughly a 120 million over six years contract) and the precedent over the last few years has been to overpay for simply average players. The owners want to rewrite the rules as to how to sign players so this doesn't happen anymore. Instead of being allowed to sign a player for six guaranteed years for 120 million dollars, they want the max to be more like four years for 50 million, no guarantees. They feel like cutting player salaries by about 50% is the best way to help them save money, and thus, turn a profit.
Additionally, the owners want the soft salary cap to become a hard cap, meaning that under no circumstances can teams exceed the cap.
The players, on the other hand, do not want a pay cut. They believe that NBA owners should not be entitled to make a profit just for owning a team, and believe that it's an owner's own person financial responsibility if they offer an absurdly large contract and thus lose money.
Now the two sides are meeting to create a new agreement. Owners want to cut salaries by 50%, eliminate guaranteed contracts, and impose a hard cap. Players are only willing to budge on a very small salary decrease, something like five percent. NBA won't resume until the two come to an agreement.
Considering how far away they are in bargaining, it's probably going to be a long lockout.