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Should there be Revenue Sharing limits?

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Old
11-07-2012, 01:06 PM
  #51
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Originally Posted by MoreOrr View Post
Just taking your post in general, I'm in total agreement. Revenue Sharing is a good thing, definitely, especially in any league where is exists economic disparities and especially to the degree that it exists in the NHL. But I'm really being specific with respect to certain teams continually and always being on the receiving end of Revenue Sharing. One would think that, as a League, all teams would be expected to at least ocassionally be among the 'givers' in Revenue Sharing and not always the 'receivers' (or at the very minimum, be among a group of teams that not gives nor receives because they're in the middle).

I think you slightly misunderstood his point.

The issue isn't the disparity. The issue is that the disparity itself is enforced by the rules of the current CBA.

However much money the lowest revenue team makes, the floor will be above that point, just by the way the cap and floor are calculated.

That means that the team at the bottom of the revenue list will always lose money, regardless of how much money that team makes, and there will always be one team at the bottom of the revenue pile because that's the math -- in any list involving varying values, one value is always the lowest. That team is guaranteed to lose money where there's 30 teams in the league or only 6.

One would think that when you eliminate your worst money loser, a rising tide would raise all boats. In this case, removing the leakiest boat just sinks someone else.

We need to overhaul the system from top to bottom because the current system is broken. That's at the core of why there's really a lockout right now, whether the owners and PA recognize that or not.


Last edited by Dojji*: 11-07-2012 at 01:11 PM.
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11-07-2012, 01:23 PM
  #52
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Originally Posted by Mayor Bee View Post
During the 1990s, San Diego finished above .500 four times, made the playoffs twice, and was 758-799 overall. From 2000-08 (when their ownership problems began), they made the playoffs twice and were 694-765 overall.
The Padres won their division four times in the last 20 years and also made it to the world series. While perenially having one of the smallest payrolls in baseball and revolving owners and management



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This season was the first time since 2006 that the A's finished with an above-.500 mark. Ever since "Moneyball" was written, Oakland basically lost their competitive advantage since other teams started outbidding the A's for the types of players that they were in the market for, leaving them with scraps and guys who were on their way out of the league entirely. In many ways, Frank Thomas was the symbol of the post-"Moneyball" A's....they signed him at a bargain price because he was thought to be done entirely, he had a huge year, and they lost him as a free agent to a team that could simply afford to spend a lot more on him.
Since 2000 the A's have made the playoffs six times that's almost 50% of the time in a sport that it's very hard to make the playoffs in


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Tampa Bay...how quickly we forget the fact that their first 10 years involved 9 finishes in the bottom of the AL East, no playoff appearances, and the best single-season record of 70-91. Years upon years of good drafting got them to a position of being able to contend, and then their top players (Carl Crawford and Carlos Pena) l
eft for free agency.
The Rays have made the playoffs three of the last 5 years



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In the case of Cleveland, they had a run of seven years where they made the playoffs six times (and went 90-72 the year they missed), and had a pair of World Series appearances. Nearly everything went right from drafting, trading, and developing, and then everything fell apart when the economics of baseball forced it to be dismantled.
Everything went drafting, trading, and developing under John Hart. The team has not done nearly as well of a job under Shapiro and that is a much bigger percentage of their problem.

It's much more about management than economics

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11-07-2012, 01:39 PM
  #53
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Originally Posted by Dojji View Post
I think you slightly misunderstood his point.

The issue isn't the disparity. The issue is that the disparity itself is enforced by the rules of the current CBA.

However much money the lowest revenue team makes, the floor will be above that point, just by the way the cap and floor are calculated.

That means that the team at the bottom of the revenue list will always lose money, regardless of how much money that team makes, and there will always be one team at the bottom of the revenue pile because that's the math -- in any list involving varying values, one value is always the lowest. That team is guaranteed to lose money where there's 30 teams in the league or only 6.

One would think that when you eliminate your worst money loser, a rising tide would raise all boats. In this case, removing the leakiest boat just sinks someone else.

We need to overhaul the system from top to bottom because the current system is broken. That's at the core of why there's really a lockout right now, whether the owners and PA recognize that or not.
No, I completely understand that, but I was focusing on a different point. My point is that, regardless of which team is at the Salary Floor, the Floor shouldn't be so low as to make any teams that spend that low virtually automatically uncompetitive. If the Cap Floor is an uncompetitive level then it's simply too low; and allowing teams to spend that low will only result in a further economic downward spiral for those teams.

Yes, whatever the Salary Cap and Floor are, there logically will be teams that will lose money in the end because simply spending to the Floor will be too much for them. However, under no circumstance should that apply to any more than 1/2 the teams in the League. If it applies to more than 1/2 the teams in the League, then the mid-point on which the Cap Ceiling and Floor are based is too high.

Now, continuing again from the point I had been making: Teams losing money because even spending to the Salary Floor is too much, shouldn't equate to teams not being competitive if they only spend to the Salary Floor. So theoretically, a team losing money because even spending to the Salary Floor is too much, but that can be competitive, should be able to generate more revenue as a result of being competitive, and thus not continue (or continually) to be a money losing team.

If the Cap amounts are not horrendously out of reach, and if even spending only to the Salary Floor can still allow a team to be competitive, then one should imagine that there won't always be the same group of teams at the bottom end being the recipients of Revenue Sharing.


To Cont.
If there are teams which are fairly consistently competitive but are always losing money, then those teams are either located in places where hockey isn't sufficiently desired, or the League has a salary system in place which is demanding more to be spent to be competitive than what many teams can afford.

On the flipside, if the salary system is judged to be fair, that teams at the low end can still be competitive and can fairly regularly compete their way out of a position of being revenue sharing recipients, BUT you have one or two teams that never reach that success,... then it's either a case of teams located where there isn't sufficient demand for hockey, or there is poor management running those teams and not giving those teams the opportunity to succeed.


Adding something more:
Take Atlanta... It's quite possible that there was a 3-way negative dynamic going on there:
1) It seems clear that the owners didn't care and as a result the team got poorly managed.
2) Perhaps it's certainly true that the fanbase for hockey isn't that strong there (but hey, the same could be said for many NHL cities).
3) As we've discovered recently, the Salary levels have been simply too high for many teams in the League.

Put that altogether, and perhaps Atlanta (as well as Phoenix) didn't stand a chance in hell. Or alternatively, perhaps Atlanta is a place that just can't support an NHL team.


Last edited by MoreOrr: 11-07-2012 at 02:02 PM.
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11-07-2012, 02:17 PM
  #54
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Originally Posted by MoreOrr View Post
Asking the question in the title, but being a bit more specific, meaning a Revenue Sharing limit as to how many consecutive years a team can be on the receiving end of Revenue Sharing, and how much money in total any particular team might be shared over a period of time.

I would think that, No, there shouldn't necessarily be a limit as to how many years and how much money a team receives in Revenue Sharing, not if the teams handing out the money are willing to keep handing it out. However, to me it seems counter-productive to maintain a certain team indefinitely if it's never going to earn a profit. Eventually, one would think, it might be better to cut and move on to potentially better pastures.

But then, what if it's the owners and the management of the franchise and the team which is deemed the cause for the franchises failures and economic woes? Is there never anything the League can do to fix such problems and actually give a team and its city a real chance to have some success?
Yes but it should not be solely based on number of years receiving revenue sharing or amount received. Unless those bars are set very high, it inevitably will hurt a well-run team that is simply going through a rough patch.

Instead, a broader formula should be developed. How big is the market? How long has the team been located where it is? What's the arena situation? How many years has revenue sharing been needed? How much has the team received total? How much money has the team been spending on players? Is the team under performing amongst a group of similar franchises? All these and more should be taken into account, each varying in importance.

A baseball-type system, where teams like Kansas City and Pittsburgh can make profits in the tens of millions and yet spent little on the on-field product, is not desirable. Owners should be held to account for both continued incompetence and negligence (Owners need to make efforts to grow the sport; the team cannot simply be used as a breakeven enterprise while ownership reaps profit from an associated arena management contract).

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11-07-2012, 02:58 PM
  #55
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My whole issue with this is:

How do you determine Who "sucks because they have no money" versus who "has no money because they suck" ?

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11-07-2012, 03:28 PM
  #56
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Originally Posted by KevFu View Post
My whole issue with this is:

How do you determine Who "sucks because they have no money" versus who "has no money because they suck" ?
If the Salary Floor is sufficient for a well-run team to be competitive, then teams that remain stuck near the Salary Floor and are constant recepients of Revenue sharing are so because they "suck" = are poorly run (or because being competitive doesn't matter because not enough people in the area have an interest in hockey).

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11-07-2012, 04:23 PM
  #57
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Originally Posted by MoreOrr View Post
If the Salary Floor is sufficient for a well-run team to be competitive, then teams that remain stuck near the Salary Floor and are constant recepients of Revenue sharing are so because they "suck" = are poorly run (or because being competitive doesn't matter because not enough people in the area have an interest in hockey).
I'm with you but there are a lot of things that go into it. For example, is the team trying to develop a new market ? I think that everyone agrees that making a go of the blue jackets is much harder than the Jets 2.0. But if a team gets RS for a decade and still needs these funds to prevent catastrophic losses, can one still blame the emerging market scenario ? Like people have said the senators had a rough start for 5 or 6 years. If they were protected for that time, is it unreasonable to ask for 10 or 20 years in non traditional markets ?
This isn't rhetorical, I really don't know what a reasonable amount of time to establish a completely new market would be.

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11-07-2012, 06:01 PM
  #58
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I think that everyone agrees that making a go of the blue jackets is much harder than the Jets 2.0.
In terms of revenue, sure. But not in terms of being competitive. The Thrashers went from a bad joke to being competitive because they went from being run poorly to being well run.

Revenue sharing shouldn't be seen as welfare, it should be an investment by other teams in the future of that franchise. Give now to get later. Teams that are running themselves into the ground shouldn't qualify.

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11-07-2012, 06:15 PM
  #59
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Originally Posted by KevFu View Post
My whole issue with this is:

How do you determine Who "sucks because they have no money" versus who "has no money because they suck" ?
And how do you define "suck"? On ice product? Off-ice management?


Why does Florida lose $7 million with revenues of $81 million, yet Columbus has operating losses of $13.7 million, with similar revenues? (based on Forbes' #'s). I'm really asking because I'm curious, not being a smart-ass.

Would revenue sharing actually do anything to remedy these discrepancies?

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11-07-2012, 08:18 PM
  #60
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Originally Posted by Scurr View Post
In terms of revenue, sure. But not in terms of being competitive. The Thrashers went from a bad joke to being competitive because they went from being run poorly to being well run.

Revenue sharing shouldn't be seen as welfare, it should be an investment by other teams in the future of that franchise. Give now to get later. Teams that are running themselves into the ground shouldn't qualify.
Of course I mean revenue, despite the population difference the peg is WAY easier of a market because the demand was, is and likely will always be there.

Ottawa is a good market with clear existing demand. The sens had a rough time of it initially but turned the corner. Can columbus do the same ? I think it highly unlikely to happen in the same time frame because they are building this demand from scratch. As such I think columbus should be given more time to turn the corner, what I dont know is how much more time. Its entirely empirical but if cbj is still on the receiving end of rs in 5 or 10 years, then I think you have to at least consider cutting your losses.

Yes toronto and mtl have an interest in having teams to play against but if cbj were to move to hamilton, the habs and leafs still have someone to play and likely dont have to keep subsidising teams in questionable markets. I dont think that the have teams are lamenting that the thrashers left atl for the peg.

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11-07-2012, 09:07 PM
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Originally Posted by sandysan View Post
I'm with you but there are a lot of things that go into it. For example, is the team trying to develop a new market ? I think that everyone agrees that making a go of the blue jackets is much harder than the Jets 2.0. But if a team gets RS for a decade and still needs these funds to prevent catastrophic losses, can one still blame the emerging market scenario ? Like people have said the senators had a rough start for 5 or 6 years. If they were protected for that time, is it unreasonable to ask for 10 or 20 years in non traditional markets ?
This isn't rhetorical, I really don't know what a reasonable amount of time to establish a completely new market would be.
That's what I mean. To a novice, it might be that "hey, they draft poorly, or trade players too early, or don't sign enough free agents."

But when you look at someone like Phoenix for example. Yeah, they were horribly mismanaged by Moyes, but their attendance went from bad to abysmal when the team went into bankruptcy.

Columbus is another team that has sucked on the ice, but at the same time, they had a horrible lease because of Ohio State's meddling. They've renegotiated, as has Nashville.

I posted it before: The Islanders are bad and have been terrible for most of the last two decades. Multiple owners and GMs. The constant is their inferior arena and horrible lease (we'll see how Brooklyn pans out). The same measures of "no improvement" for NYI aren't due to not developing a fan base. Their fans chanted "S-M-G Set Us Free." And when they didn't, stopped going to games. That's a savvy fan base to realize they're not going to pay SMG to watch the Islanders.

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And how do you define "suck"? On ice product? Off-ice management?

Why does Florida lose $7 million with revenues of $81 million, yet Columbus has operating losses of $13.7 million, with similar revenues? (based on Forbes' #'s). I'm really asking because I'm curious, not being a smart-ass.

Would revenue sharing actually do anything to remedy these discrepancies?
That's the crux of my argument. Every situation is different. And when you look at the top revenue teams (NYR, TOR, MON, CHI, DET, VAN, PHI, BOS, etc) and look at the bottom (PHX, NYI, CBJ, NASH) the common denominator isn't market size, geographic latitude, "traditional hockey market" or anything like that. It's WHO OWNS/OPERATES THE ARENA. Of the top 14 teams in revenue 12 own/operate their arenas. The teams at the bottom lease with bad terms.

There shouldn't be a single restriction on who's eligible for revenue sharing. Teams who have to spend over the negotiated percentage of HRR to reach THE FLOOR should get revenue sharing. Period. Anything else blows up the equilibrium of the system.

I think the percentage of HRR comes second; then revenue sharing third; then player contract issues fourth. The key issue to address for me, is Median instead of Average for the midpoint. Fix that, and you instantly get balance of haves, have nots, and middle class. Then figure out the percentage with the NHLPA to get them their share and get most teams possible within the salary range within reason; THEN figure out revenue sharing so that those teams who don't fall within the payroll range (this is all assuming everyone spends their Pct on payroll) can hit the floor. THEN give and take on player contract issues.

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11-07-2012, 09:29 PM
  #62
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I posted it before: The Islanders are bad and have been terrible for most of the last two decades. Multiple owners and GMs. The constant is their inferior arena and horrible lease (we'll see how Brooklyn pans out). The same measures of "no improvement" for NYI aren't due to not developing a fan base. Their fans chanted "S-M-G Set Us Free." And when they didn't, stopped going to games. That's a savvy fan base to realize they're not going to pay SMG to watch the Islanders..
... yes, I know you "posted it before" and I also know your a die-hard Islanders fan. And sorry Kev, I dont see it getting any better for them in Brooklyn. Your simply rearranging the deck chairs on the Titanic.... that is one franchise that should never have been given birth. Its only raison d'etre for existence being the now long outdated and completely misguided belief held by a Rebel League that top end hockey would thrive in a bedroom community. Even through the Salad Days of multiple Cups they were losing money.... Mike Bossy, now working as a DJ on CHOM FM's "Electric Lunch Hour" out of Montreal admits as much. Its a ridiculous location for a franchise. And if you wanna hold tight to principals, refusing to pay respect to MSG & the Rangers, its proper place and history in the league, thats your problem. The tri-state region is oversaturated. Jersey existing only because Philly, the Isles & MSG Inc collected some free coin when the Rockies moved in. Nothing to do with "footprint" or even basic common sense. So here we are.

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11-08-2012, 01:41 AM
  #63
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Can columbus do the same ? I think it highly unlikely to happen in the same time frame because they are building this demand from scratch. As such I think columbus should be given more time to turn the corner, what I dont know is how much more time. Its entirely empirical but if cbj is still on the receiving end of rs in 5 or 10 years, then I think you have to at least consider cutting your losses.
The problem with Columbus is they are terrible, and have been terrible since they came into the league. That's no way to grow a market, I don't think the Canucks would draw well (they didn't in the late 90's) with that kind of team. So, you can keep throwing money at them but it isn't going to work, because it's a poorly run business. I wouldn't give them revenue sharing until they got their **** together.

Nashville, on the other hand, is well run. They are growing a fan base because they are a well run business. It makes sense to help them because you can see light at the end of the tunnel. Eventually, they'll have a good market that will increase national TV numbers and make everyone money. Them I would share revenue with.

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Originally Posted by KevFu View Post
To a novice, it might be that "hey, they draft poorly, or trade players too early, or don't sign enough free agents."
When you put a terrible product on the ice for 20 years, you're going to lose money. If your owner cannot fund an NHL hockey team I feel bad for you, but that shouldn't qualify him for revenue sharing. Run your business bad, lose money, that's not "novice", that's the way the world works.

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Originally Posted by KevFu View Post
There shouldn't be a single restriction on who's eligible for revenue sharing. Teams who have to spend over the negotiated percentage of HRR to reach THE FLOOR should get revenue sharing. Period. Anything else blows up the equilibrium of the system.
Then there would be no incentive for those teams to run a better business.

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Originally Posted by sandysan View Post
Yes toronto and mtl have an interest in having teams to play against but if cbj were to move to hamilton, the habs and leafs still have someone to play and likely dont have to keep subsidising teams in questionable markets. I dont think that the have teams are lamenting that the thrashers left atl for the peg.
The fans in Hamilton already give money to the NHL, they buy merchandise, go to games, add to national and local TV numbers. The big money is in all the sports fans in the US that don't know what hockey is. Even a small piece of that US pie is huge money. If the NHL could find people to run these teams well, they'd make some headway and eventually lots of money for everyone.


Last edited by Scurr: 11-08-2012 at 01:55 AM.
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11-08-2012, 02:56 AM
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The problem with Columbus is they are terrible, and have been terrible since they came into the league. That's no way to grow a market, I don't think the Canucks would draw well (they didn't in the late 90's) with that kind of team. So, you can keep throwing money at them but it isn't going to work, because it's a poorly run business. I wouldn't give them revenue sharing until they got their **** together.
No expansion team wins in their first year. You need to look at the early CBJ attendance numbers. They were good. They haven't been good since the fanbase caught on to how badly hockeyops was run. Your argument completely overlooks their early success in attendance. This is very tiresome to hear arguments with faulty premises. The other issue is that there are only a handful of markets (mostly Canadian) that can sustain a poor hockeyops side to the org.

I agree that their are certain teams with bad hockey ops, but they aren't limited to currently weak markets. I wouldn't want hockeyops from Calg, TO or Edm anywhere near SJ.

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11-08-2012, 03:17 AM
  #65
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They haven't been good since the fanbase caught on to how badly hockeyops was run. Your argument completely overlooks their early success in attendance. This is very tiresome to hear arguments with faulty premises.
Sorry to tire you I don't see how their early attendance effects what I'm saying. Teams usually get a head start with some early buzz and attendance. Since, they've run that team poorly and that has lead to poor attendance and little growth in that market.

San Jose has had success on the ice and drawn pretty well, haven't they?

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The other issue is that there are only a handful of markets (mostly Canadian) that can sustain a poor hockeyops side to the org.
Why should a team be able to sustain when it's run poorly? What other business could I run poorly and expect to make money?


Last edited by Scurr: 11-08-2012 at 03:32 AM.
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11-08-2012, 10:07 AM
  #66
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The fans in Hamilton already give money to the NHL, they buy merchandise, go to games, add to national and local TV numbers. The big money is in all the sports fans in the US that don't know what hockey is. Even a small piece of that US pie is huge money. If the NHL could find people to run these teams well, they'd make some headway and eventually lots of money for everyone.
Based on past experience, I am not convinced that these presumed fans just waiting to take up the torch for the game in the US actually exist, and if they exist I suspect that they are not nearly as numerous as some purport. I think it fantastically unlikely that the NHL will ever surpass the NBA (or MLB) in terms of popularity in the US.
Chasing this mirage is largely what got us into this mess ( the idea that you can easily manufacture a new market based on snowbirds and the appeal of a "major league" team in regions with zero historical relationship to the game).


My point was to counter the argument that it is in the habs and leafs best interest for Columbus to succeed because if all of the have not teams dissappeared then we would be back to the original six plus some and that would be bad for the have teams. As long as the habs have someone to play ( be it columbus or hamilton or seattle) I can see that the have teams would prefer to play teams that they would not have to perpetually prop up with RS dollars.

I really would love it if the non traditional markets could rebound and get their houses in order but I dont think that EVERY non traditional market could do this irrespective if they are well run or not.

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11-08-2012, 12:11 PM
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The Padres won their division four times in the last 20 years and also made it to the world series. While perenially having one of the smallest payrolls in baseball and revolving owners and management
In an extremely weak division, where winning 90 games will all but guarantee a division title. Two of those division titles were with less than 90 wins, and one involved an 82-80 record.

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Since 2000 the A's have made the playoffs six times that's almost 50% of the time in a sport that it's very hard to make the playoffs in
In the AL equivalent of the NL West, as far as both location and mediocrity go. Both West divisions have only four teams, while no one else has less than five, so there's also a mathematical advantage to being located in one of those divisions anyway.

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The Rays have made the playoffs three of the last 5 years
The first time they made the playoffs was the first time they had more than 70 wins in a season.

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Everything went drafting, trading, and developing under John Hart. The team has not done nearly as well of a job under Shapiro and that is a much bigger percentage of their problem.

It's much more about management than economics
Hart looks terrific because he had an inordinate number of trades work out well. Shapiro looks worse because he's closer to the league average.

Regardless, it's very much an economic issue rather than management. If Cleveland has a Cy Young pitcher coming up on free agency, everyone in baseball knows that he will not re-sign with Cleveland because they're not able to outbid anyone. If they have an MVP candidate in the field approaching free agency, the question is simply "Where will he go?" instead of "Will he re-sign?", since everyone knows that the latter is not going to happen.

And this puts the small-market teams in a position of needing to dump their premier players for whatever they can get in the form of prospects (or, in the NHL, draft picks as well). Not only that, but they have to hope like hell that those players develop into everyday players, or they'll have essentially lost an All-Star and have nothing to show for it. The difference is in the returns for Bartolo Colon (three players who became All-Stars), and that for CC Sabathia (two players who are out of baseball entirely, one who's still in the minors, and one who's just become an everyday player this year).

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11-08-2012, 12:19 PM
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Originally Posted by Stewie Griffin View Post
Why does Florida lose $7 million with revenues of $81 million, yet Columbus has operating losses of $13.7 million, with similar revenues? (based on Forbes' #'s). I'm really asking because I'm curious, not being a smart-ass.

Would revenue sharing actually do anything to remedy these discrepancies?
The biggest issue with the CBJ has been the arena lease. Without actually living here in central Ohio, it's difficult to capture the entire attitude of the local powers-that-be toward a possible NHL team in the last 20 years.

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Originally Posted by Scurr View Post
The problem with Columbus is they are terrible, and have been terrible since they came into the league. That's no way to grow a market, I don't think the Canucks would draw well (they didn't in the late 90's) with that kind of team. So, you can keep throwing money at them but it isn't going to work, because it's a poorly run business. I wouldn't give them revenue sharing until they got their **** together.

When you put a terrible product on the ice for 20 years, you're going to lose money. If your owner cannot fund an NHL hockey team I feel bad for you, but that shouldn't qualify him for revenue sharing. Run your business bad, lose money, that's not "novice", that's the way the world works.

Then there would be no incentive for those teams to run a better business.
There is not anywhere close to enough incentive to actually pocket revenue sharing checks without improving the team on the ice. It can happen in MLB, NFL, and NBA simply because of the monstrous TV contracts, but in the NHL, there's still too heavy of a reliance on gate revenue to make this "take the money and run" scenario likely.

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Originally Posted by SJeasy View Post
No expansion team wins in their first year. You need to look at the early CBJ attendance numbers. They were good. They haven't been good since the fanbase caught on to how badly hockeyops was run. Your argument completely overlooks their early success in attendance. This is very tiresome to hear arguments with faulty premises. The other issue is that there are only a handful of markets (mostly Canadian) that can sustain a poor hockeyops side to the org.
Doug MacLean also padded the attendance numbers in 2005-06 and 2006-07 to cover the fact that more and more people were staying away from the train wreck that he turned the franchise into. When Scott Howson arrived in 2007, one of the first things he did was ban that practice, so since then the only reported number is the actual number.

Quote:
Originally Posted by Scurr View Post
Why should a team be able to sustain when it's run poorly? What other business could I run poorly and expect to make money?
In a "normal business" atmosphere, market share in a growing industry is vital. If there are 30 plastic extruders in your area and one of them starts to flounder, should the other 29 care? Hell no; that's a greater market share to capture, and presumably a greater pool of qualified employees who will be back in the market in short order.

The NHL is not a "normal business" atmosphere. No North American closed professional league is a "normal business atmosphere". The markets are too spread out, and there's an emotional investment that precludes the idea of simply going to the best. If a plastic extruder closes, others who buy plastics from that now-closed plant are simply going to buy from elsewhere. If an NHL team goes away, there is no guarantee that those fans are going to follow another team, or ever follow another one even if it comes back. Sports is a luxury item.

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11-08-2012, 12:31 PM
  #69
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Maybe the owners shouldn't hand out franchises like candy.

Sorry, you guys took the money. If the owner of a team wants to continue in his current location, you're stuck with that team being there until the owner wants to sell or re-locate.

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11-08-2012, 12:47 PM
  #70
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Originally Posted by MoreOrr View Post
No, I completely understand that, but I was focusing on a different point. My point is that, regardless of which team is at the Salary Floor, the Floor shouldn't be so low as to make any teams that spend that low virtually automatically uncompetitive. If the Cap Floor is an uncompetitive level then it's simply too low; and allowing teams to spend that low will only result in a further economic downward spiral for those teams.

Yes, whatever the Salary Cap and Floor are, there logically will be teams that will lose money in the end because simply spending to the Floor will be too much for them. However, under no circumstance should that apply to any more than 1/2 the teams in the League. If it applies to more than 1/2 the teams in the League, then the mid-point on which the Cap Ceiling and Floor are based is too high.

Now, continuing again from the point I had been making: Teams losing money because even spending to the Salary Floor is too much, shouldn't equate to teams not being competitive if they only spend to the Salary Floor. So theoretically, a team losing money because even spending to the Salary Floor is too much, but that can be competitive, should be able to generate more revenue as a result of being competitive, and thus not continue (or continually) to be a money losing team.

If the Cap amounts are not horrendously out of reach, and if even spending only to the Salary Floor can still allow a team to be competitive, then one should imagine that there won't always be the same group of teams at the bottom end being the recipients of Revenue Sharing.


To Cont.
If there are teams which are fairly consistently competitive but are always losing money, then those teams are either located in places where hockey isn't sufficiently desired, or the League has a salary system in place which is demanding more to be spent to be competitive than what many teams can afford.

On the flipside, if the salary system is judged to be fair, that teams at the low end can still be competitive and can fairly regularly compete their way out of a position of being revenue sharing recipients, BUT you have one or two teams that never reach that success,... then it's either a case of teams located where there isn't sufficient demand for hockey, or there is poor management running those teams and not giving those teams the opportunity to succeed.


Adding something more:
Take Atlanta... It's quite possible that there was a 3-way negative dynamic going on there:
1) It seems clear that the owners didn't care and as a result the team got poorly managed.
2) Perhaps it's certainly true that the fanbase for hockey isn't that strong there (but hey, the same could be said for many NHL cities).
3) As we've discovered recently, the Salary levels have been simply too high for many teams in the League.

Put that altogether, and perhaps Atlanta (as well as Phoenix) didn't stand a chance in hell. Or alternatively, perhaps Atlanta is a place that just can't support an NHL team.
The problem is you can't divorce this line of reasoning from the central point I'm bringing up. The fact is that when the bottom revenue teams increase their revenue the cap floor goes up -- and thus so does the price of BEING competitive. They can't meet the standard of what it takes to be competitive at least in part because any time they make progress towards that goal, the goalpost moves further away.

The only way any individual low revenue team can get away from this problem is to surpass someone else, and then the focus is on that team and the league as a whole isn't really any better off.

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11-08-2012, 02:10 PM
  #71
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Quote:
Originally Posted by Dojji View Post
The problem is you can't divorce this line of reasoning from the central point I'm bringing up. The fact is that when the bottom revenue teams increase their revenue the cap floor goes up -- and thus so does the price of BEING competitive. They can't meet the standard of what it takes to be competitive at least in part because any time they make progress towards that goal, the goalpost moves further away.

The only way any individual low revenue team can get away from this problem is to surpass someone else, and then the focus is on that team and the league as a whole isn't really any better off.
Let me start by saying, excuse me, Dojji, if there's some point you're making that I'm not getting. Now ok, of course there is always going to be a team at the bottom, that's obvious; if one team succeeds in moving up from the bottom then it gets replaced by another, and as you say, up goes the price of being competitive. But if I can take this back now to the OP, my question was/is: If one or two particular teams are consistently always the bottom one or two, over a long stretch of time, then shouldn't it be asked: What economic benefit are those one or two teams doing for the League since they are always the recipients of the greatest amount of Revenue Sharing. If those teams can move up ocassionally and not always be the teams syphoning off from the rest then fine.

As long as there is Revenue Sharing, and I agree with the system that includes it, then there's always going to be these or those teams at the bottom end receiving that revenue. But if it's forever being the same teams, then what economic benefit are those teams doing for the League, I suppose, other than taking that bottom spot where perhaps other teams are happy not to be?

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11-08-2012, 04:10 PM
  #72
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Quote:
Originally Posted by Stewie Griffin View Post
And how do you define "suck"? On ice product? Off-ice management?


Why does Florida lose $7 million with revenues of $81 million, yet Columbus has operating losses of $13.7 million, with similar revenues? (based on Forbes' #'s). I'm really asking because I'm curious, not being a smart-ass.

Would revenue sharing actually do anything to remedy these discrepancies?
Reply to the bolded portion. That's simple, Florida spent to the cap floor while Columbus spent close to the cap ceiling.

No for extra credit, go look up what happens to revenue sharing when a team spends above the mid-point.

This thread seems to have a lot of posts indicating many posters believe Columbus is existing on revenue sharing. Those posters probably also think Columbus is a "sunbelt team."

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Old
11-08-2012, 06:42 PM
  #73
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Part of the problem is the linkage that the owners wanted but as the revenue jumped

the have nots struggle to get to the cap floor


and sometimes teams spend poorly.... dont make the playoffs esp for a stretch of a few years...you really need to make the playoffs and win a round or two to bankroll some profit.....(unless your in a huge profit center where fans own numerous sweaters and pump alot of money into the team even when they dont go to the game.

I do think that some revenue is due and would make the game overall healthy.

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11-08-2012, 06:46 PM
  #74
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Quote:
Originally Posted by Stewie Griffin View Post
And how do you define "suck"? On ice product? Off-ice management?


Why does Florida lose $7 million with revenues of $81 million, yet Columbus has operating losses of $13.7 million, with similar revenues? (based on Forbes' #'s). I'm really asking because I'm curious, not being a smart-ass.

Would revenue sharing actually do anything to remedy these discrepancies?
probably has alot to the travel from one confrence to another....

clb has to travel all over the west......Fla is limited therby their travel costs are less.


that is the big reason det and clb want to move to the east confence...less money and wear and tear.


ideally when they get to the nitty gritty of negotations... they will approach the new format again of 2 confrences and 2 divisions(7 and 8 teams)........play your divsion 5-6 times play everybody outside of your division twice.....will probably decrease travel costs

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11-08-2012, 08:06 PM
  #75
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I think people need to realize that revenue sharing is not the solution to any of these problems.

The issue is how do you get people in the failing markets to pay top dollar to attend hockey games, and how do you get people to watch those games on TV so the teams can get big local TV contracts. Thats the only way to make these franchises viable.

I dont see how stealing money from successful teams accomplishes any of that.

Phoenix has been a playoff team for 3 straight years and they have no fans. Tampa Bay won the Cup within the last ten years and they dont have a steady fanbase. The Panthers were a good team that made a playoff run and they were basically giving away tickets. None of these teams do exceptionally well in their local markets on TV. So how does getting a few extra bucks help them long term? Answer...it doesnt.

Let the teams run their business free of restraints. Some teams will be the Royals, but still survive. Some teams will fail and will move, but guess what? Those teams will fail and move without revenue sharing and with a cap.

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