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08-02-2013, 08:12 PM
  #135
RealityBytes
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Quote:
Originally Posted by groovejuice View Post
I'm not sure how you find the projected financial growth/salary cap unreasonable.

Berkshire used the 8.9% annual growth average from the last CBA period. The league may even surpass these numbers, especially if one or two struggling teams move and the certain addition of 2 more franchises to make an even 30.

The cap going down for 2014 is not based on revenues per se, but is an artificial limit imposed through negotiation in the current CBA.
2007-2008 = $50.3M cap
2008-2009 = $56.7M cap
2009-2010 = $56.8M cap
2010-2011 = $59.4M cap
2011-2012 = $64.3M cap
2012-2013 = $60.0M cap (pro-rated from $70.2M)
2013-2014 = $64.3M cap

So after seven seasons, the increase is $14M using absolute numbers instead of percentages. In the next seven years, that number as the writer projected would be $28.1M or double the absolute growth in the previous seven years. Yes, inflation will account for some of that but definitely not all especially in economies that are still weak and that are fighting inflation.

As for why in 2014, the reason of why the cap went down one year is irrelevant, such as with a change in negotiation with the CBA, it still went down and could also do so again if owner's profits are in the red.

This is all in a fairly saturated market with only a handful of teams making a profit and most losing money. That certainly doesn't look like it will change much in structure nor project (as I see it) to a 9% average overall growth in calculable revenues for the players share in the next ten years. As well, if the owners are still losing money, they will go after and get more of the player's piece of the pie.

I'm not sure where you see two more teams because I see 30 now (7 Pacific +7 Central + 8 Atlantic +8 Metropolitan) and 30 will stay the number. A lot of teams are struggling financially but where do you move them? Most of the larger centers in the US have them and in Canada, even a place like Quebec city that wants a team, already lost one before due to low revenues. There will only be so much growth in those "have not" teams that can barely give tickets away and the "have" teams (e.g. Toronto, Montreal, NY) which don't have many ways to expand on what they have now when they are already at max sales and revenue. Price increases for a few teams can only account for so much.

The only thing that would change all this is a major growth in fan base in the US, but with the heavy competition from other sports and the fact that hockey is just not that popular in the US, I don't see that happening.

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