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01-04-2013, 10:34 AM
  #137
haseoke39
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Quote:
Originally Posted by MoreOrr View Post
It's damn frustrating sometimes debating here when in one thread I make a point arguing that RS should be more, and then you supposedly clarify that it's already something like 66%. And then in the Lockout sticky thread (which is now closed)late last night a guy responds to be saying there needs to be better RS, something like the NFL, rather than the about 4.5% that there is in the NHL. That 4.5 % number I've seen before, but somebody has to be very wrong. Hell of a lot of difference between 4.5% and 66%.
It's the difference between profits (66% of which will get redistributed in the next deal, presuming they accept the $250M figure on the table now) and revenues (something close to 4.5% in the last CBA, which had half the level of sharing) and, more importantly, the difference between sharing and redistribution.

It is correct that the NFL "shares" more than the NHL. But "sharing" only means everybody puts their money into one big pot. It doesn't mean that it gets redistributed more equitably between the teams afterwards.

Here's your 101 on the subject:

The NHL's version of "sharing" is direct redistribution. The rich teams write the poor teams a check. The NFL's version of sharing is that everybody puts their revenue into one big pot, and then takes back something that might be a little more or a little less than what they put in. That is, the NFL does a huge amount of sharing, but how much redistribution they do is another matter (and one that we can't answer easily).

Here's something we can answer easily. Let's assume that the NHL "shares" 84% of its total revenue (not just profit, but the whole shebang) in the same way that the NFL does. Let's say that half of the shared revenue gets split up the way the NFL does its gate receipts - 60% for the home team, 40% for the visiting team. Then let's assume that the other half gets split up the way the NFL splits up its TV and merchandising revenues: everybody takes an equal slice. Sounds like that would be a high amount of sharing AND a huge amount of redistribution, right?

But you'd probably be wrong. What matters here is the NET of how much each team takes out of the pot and how much each team puts in. And if we assume that comparative revenue streams across TV and merchandising have about the same distribution as gate receipts do (i.e., NYR make 5x as much TV/merch money as the Islanders, Toronto is about 4x as much as Phoenix) then you can crunch some simple math and get the following: You'd only "redistribute" about $330M.

The above example is so littered, so positively filled with generous assumptions for the pro-PA folks here that I don't even want to get into it. Suffice to say, the NHL has a smaller pot, but when 100% of that pot goes straight from rich teams to poor, they're probably redistributing as much as the NFL does with a much bigger pot.

A huge amount of sharing may only lead to small amount of redistribution. That's the bottom line, and what drives me absolutely crazy is that very few people understand this. They hear "sharing" and assume that if the NFL puts 100% of its money into one big pot, that means that 100% of revenue gets redistributed. It doesn't. It would be mathematically impossible, actually, if you presume Green Bay started with any money in the first place. The NFL has a huge pot from which even the rich teams take and into which even the poor teams pay.


EDIT: I keep having to explain this 500x, so I'm going to try a simple example. Team A makes $100M. Team B makes $90M. In an NFL style redistribution, let's say 100% of revenues go into one big pot and get distributed evenly. So both sides end up with $95M. Nominally, we call that 100% sharing, but in practice, only $5M changed hands. So it's about 3% redistribution.

In an NHL style redistribution, Team A writes Team B a check for $5M. Same exact effect. But, nominally, it's only 3% sharing now.

You see how this works? 100% sharing can have the same exact effect as 3% sharing. That's the power of sharing v redistribution. You have to actually do the math to get at how much money is changing hands, and by my estimates, the NHL is probably doing as much or more as the NFL is doing.


Last edited by haseoke39: 01-04-2013 at 10:50 AM.
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