2012-2013 Lockout Discussion Thread
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08-17-2012, 07:13 PM
Join Date: Sep 2004
I know that last post is a bit wordy and I might be hard to follow the math behind it, so I will try to show how contraction wont help.
Let's say total HHR is $3B (I know it is more, just want to keep numbers nice and neat). So $3B divided by 30 teams gives us $100MM per team. At 57%, that gives us a cap of $57MM per team.
Now, let's say we remove the two lowest revenue teams. So total HHR will go down, but not by $200MM. Let's say the revenues of each of those teams is $25MM each, for a total of $50MM. Those teams are contracted, and HHR now becomes $2.95B, which will now be divided by 28 gives us over $105MM per team. Take 57% and we have a cap of about $60MM. Cap has gone up, and the floor will go up, and those teams at 25, 26, 27, 28 in revenues are going to be n bad shape. Regardless of how many teams you contract, the bottom teams are going to have problems.
Now, if we move those bottom teams to stronger hockey markets, and each of these teams doubles their revenues from $25MM each to $50MM each, well, now we have total HHR of $3.1B. Divide that by 30 (we'll assume there was no contraction), and we get ~$103MM per team, at 57% means a cap of $58.9MM per team. Again, teams near the bottom are going to be worse off.
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