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09-20-2012, 07:06 AM
  #42
pvr
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Join Date: Jan 2008
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Quote:
Originally Posted by IU Hawks fan View Post
Uhh, you got it ass backward. The owners were who demanded the players take a fixed percentage of revenue...
In all major sports now a "salary cap" of some sort exists so that teams that are very profitable don't spend an inequitable amount vis a vis teams that are not/less profitalbe, as well as to reduce overall operating costs. The cap was put in place as a fixed percentage in the NHL (vs a soft cap as in MLB, or a cap with circumventions as in the NBA) so that (for example) the Rangers wouldn't outspend Columbus by $75 million to ice a team.

A cap in the absurd world of sports entertainment salaries also prevents the owners from damaging the game due to payroll inequalities and spiraling costs. Finally, it should be noted that the costs for escalating salaries are passed along to the fan in the form of increased ticket prices, concessions, parking, etc... I surmise that you are too young to remember reasonable ticket prices to major league games. A family of four might easily spend now upwards of $500 (or more depending on the sport) to go to a major league game.

The paradigm of employees in some instances making more than an owners' annual profit exists with or without a salary cap in most major sports these days. This paradigm to my knowledge does not exist in any other business model. Please enlighten me with other examples if I'm misinformed.


Last edited by pvr: 09-20-2012 at 08:28 AM.
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