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Bob McKenzie: NHL doesn't need max contract length

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Old
11-11-2012, 04:52 PM
  #26
Orrthebest
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Originally Posted by Ginu View Post
If we focus on the following:
-50/50 of HRR
-salary cap
-5% variance year to year on contracts
-honouring existing player contracts
-~$250M of revenue sharing to help small market teams

Three of those are in favour of the owners, the 4th is in favour of the players and the 5th benefits the league in general. The players would take that deal.

You fix these problems and it fixes the major problems with the game. And we play hockey.

There is about zero chance the PA accept that.

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11-11-2012, 04:54 PM
  #27
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Originally Posted by thinkwild View Post
They in no way circumvent the cap - in letter or spirit!

Only if the players retire. And that isnt the way it usually works that players are looking forward for the first possible opportunity to retire and they have to be dragged back to the ice by GM's and teams to finish their contracts.

What makes you think players are going to want to retire? That isnt the history or the norm. And if it doesnt happen, the teams will lose all those savings in early years when they had a window for their later years when they dont. Seems like smart management you would want to reward to me.

How many players do you think wont play the last years of their contracts and because they are the ones that dont want to? Im thinking that might be one player a year. And we can easily penalize their teams for that so they completely lose any benefit from that without any changes to contract lengths. Bettman said himself they were circumventing the cap
you got to be kidding me, how many players over 40 are in the league right now? How many contracts are there that expire after a players' 40? I doubt most of these guys are going to want to play for scraps at the end of their contracts when they are past the twilight of their careers.

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11-11-2012, 04:56 PM
  #28
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Quote:
Originally Posted by thinkwild View Post
They in no way circumvent the cap - in letter or spirit!

Only if the players retire. And that isnt the way it usually works that players are looking forward for the first possible opportunity to retire and they have to be dragged back to the ice by GM's and teams to finish their contracts.

What makes you think players are going to want to retire? That isnt the history or the norm. And if it doesnt happen, the teams will lose all those savings in early years when they had a window for their later years when they dont. Seems like smart management you would want to reward to me.

How many players do you think wont play the last years of their contracts and because they are the ones that dont want to? Im thinking that might be one player a year. And we can easily penalize their teams for that so they completely lose any benefit from that without any changes to contract lengths.
What makes you think they might retire? Well in the early years they made 12.0M per season and at the end when they are 41 yrs old, they will be making 1.5M.....of course they will retire...these types of deal are very dis-ingenuous...........like the leadership of the PA...

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11-11-2012, 04:58 PM
  #29
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Originally Posted by thinkwild View Post
They in no way circumvent the cap - in letter or spirit!

Only if the players retire. And that isnt the way it usually works that players are looking forward for the first possible opportunity to retire and they have to be dragged back to the ice by GM's and teams to finish their contracts.

What makes you think players are going to want to retire? That isnt the history or the norm. And if it doesnt happen, the teams will lose all those savings in early years when they had a window for their later years when they dont. Seems like smart management you would want to reward to me.

How many players do you think wont play the last years of their contracts and because they are the ones that dont want to? Im thinking that might be one player a year. And we can easily penalize their teams for that so they completely lose any benefit from that without any changes to contract lengths.
So in a fantasy world where 40 year old star players play for peanuts these contracts aren't circumventing the cap?

Got it.

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11-11-2012, 05:17 PM
  #30
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The Kovalchuk decision has already dealt with this issue. We have alfie playing on the Sens. Think he wants to retire instead of play? Which player would rather retire at 40 than play for a million bucks? None that were worth that contract in the first place.

If a player is offered a declining contract like Weber that sees him paid $1 mil in salary as a 38 yr old, you think he would rather retire than play for that? If he was a ufa, what would he get? About that same amount?

If players, GM's, and management teams know when signing the contract that their teams will suffer cap consequences if the player doesnt live up to their contract, and presumably in order to save the owner from paying one mil for a $5 mil cap space hit, a $4mil non cash expense in a sense, what would be the issue? A small market may be able to get to the floor cheaply and save money while rebuilding?

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11-11-2012, 05:43 PM
  #31
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Quote:
Originally Posted by Ginu View Post
That's incorrect. There is more than one major problem with this league. Recognize that. The league is focusing on the wrong issues.

Player contracts beyond prevent cap circumvention are completely irrelevant vs. revenue sharing and fixing small market teams.

The league should be focusing on Make Whole and revenue sharing and cap circumvention.

The NHL wasted everyone's time. The NHLPA is playing hardball. For me, understandably. I don't want to be back here in 7 years when the NHL realizes they still haven't fixed their league.
And the PA has done nothing to help better the league. They can't... because the only real solution that will fix this long term means them taking a major hit on their share of HRR (median vs average revenue for HRR). The PA has a chance to mitigate their losses, however that means they actually have to start negotiating... something they haven't done to date. They really have no one to blame but themselves, and when this is eventually all said and done, will still come out as the losers due to the money they've already lost and will never recover.

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11-11-2012, 05:53 PM
  #32
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Originally Posted by thinkwild View Post
At the end of this cba or in 5 or 6 years, HRR will be $5 billion and the players share $2.5 billion. What is it they are going to have not gotten right, forcing the league next time to lock players out to fix again? Is it possible that the revenue sharing the league is saying isnt now a problem or an issue, will suddenly become an issue, and one that no one could have reasonably been expected to forsee? Will half the teams be losing money again?
Unless RS is drastically increased, or the split going even lower, more than likely the league will still be in trouble based on the system in place (using average revenue, vs median revenue). However the NHL doesn't really have too many choices in this regard. They tried to adjust HRR and the PA flipped... even when you considered that the deductions they were looking for were pretty reasonable. There's absolutely no chance the PA would allow the league to go to median*30 to determine HRR, as it would mean a few hundred million less in the HRR pot (and that would increase yearly).

So while no one in the NHL is suggesting this (median)... it's not really surprising as there's zero chance the PA would agree to it. But other than going back to the precap days, or increasing RS by 6-7 times what it is now (NHL proposed ~6.5%), it's one of the truly sustainable systems out there. And one that I think would bring about the most stability in the NHL.

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11-11-2012, 05:56 PM
  #33
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Quote:
Originally Posted by Ginu View Post
That's incorrect. There is more than one major problem with this league. Recognize that. The league is focusing on the wrong issues.

Player contracts beyond prevent cap circumvention are completely irrelevant vs. revenue sharing and fixing small market teams.

The league should be focusing on Make Whole and revenue sharing and cap circumvention.

The NHL wasted everyone's time. The NHLPA is playing hardball. For me, understandably. I don't want to be back here in 7 years when the NHL realizes they still haven't fixed their league.
that would intel the players losing much much more, and they will not go for that, that's why we'll be here again and again and again. Fixing the problem right probably puts the players share well below 50/50.

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11-11-2012, 05:56 PM
  #34
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I'm amazed at the amount of people that don't realise that revenue != profit

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11-11-2012, 06:06 PM
  #35
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Originally Posted by PensFanSince1989 View Post
..that's what it is now and what allows for the circumvention...
And make them pay them that each year...

Despite his cap hit of 5.333 mil, Roberto Luongo actually earned 6.716 mil last year: Simply forcing his salary to be equal with his cap hit will remove these kinds of deals.

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11-11-2012, 06:09 PM
  #36
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Im amazed at the amount of people that dont realize that profit shown on an artifical subset of revenues that deducts expenses even before arriving at a final number != wealth maximization for an owner from owning the hockey team.

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11-11-2012, 06:10 PM
  #37
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I agree with McKenzie...which is quite common. Great perspective offered from both sides and I agree with the particular issue of max contracts. Said all along that max contract lengths aren't needed. The opportunity to lock up a player for a longer term than 5 years shouldn't be taken away from either team or player...just keep all the other outlier rules in place to make an owner/GM take more consideration when negotiating these contracts with players.

-keep the 5% variance
-any long term contract player sent to the minors for any reason other than a rehab stint will be counted towards the cap
-any team that signs these long term contracts and trades the player to another team will retain 50% of the salary cap

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11-11-2012, 06:14 PM
  #38
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So when Gary Bettman said we are paying our players too much, we want to pay them 50% of HRR, he knowingly proposed a system that would fail?

In fact that first offer, the one that everyone laughed off as just an opening gambit from the owners, not one meant to be taken seriously, is in fact meant to be taken seriously. And if bettman locks the players out in 6 years to get 43%, or as some are calling it - the median revenue amount, fans are saying today that they will completely understand poor Bettmans need to do that and support him a 4th time in locking out the players? Even though he is knowingly asking for a deal now that will fail.

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11-11-2012, 06:54 PM
  #39
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Quote:
Originally Posted by thinkwild View Post
So when Gary Bettman said we are paying our players too much, we want to pay them 50% of HRR, he knowingly proposed a system that would fail?

In fact that first offer, the one that everyone laughed off as just an opening gambit from the owners, not one meant to be taken seriously, is in fact meant to be taken seriously. And if bettman locks the players out in 6 years to get 43%, or as some are calling it - the median revenue amount, fans are saying today that they will completely understand poor Bettmans need to do that and support him a 4th time in locking out the players? Even though he is knowingly asking for a deal now that will fail.
The median isn't about the split of revenue, but the growth. The biggest issue the NHL has isn't that they're giving 57% to the players (although that certainly doesn't help things), but that Toronto's revenue has grown something like 40+% in 7 years, while other teams have only grown 20%. And that team A's 20% is only 15m, while team B's 40% is 80m. Using the median slows this aspect down. The NHL could give 55% of the median to the PA, and with some RS would still be healthier in 10 years than it has been in the last 5 years of this deal.

But instead Toronto's growth which is at an unequal rate to team B (both in % and $) is royally screwing with almost every other team in the league. And as has been shown multiple times, it doesn't matter who team B is, using average revenue always has a loser... even in a 3 team league of Toronto, New York Rangers and Montreal. Eventually whomever is on the bottom will have issues turning a profit.

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11-11-2012, 06:59 PM
  #40
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Quote:
Originally Posted by thinkwild View Post
They in no way circumvent the cap - in letter or spirit!

Only if the players retire. And that isnt the way it usually works that players are looking forward for the first possible opportunity to retire and they have to be dragged back to the ice by GM's and teams to finish their contracts.
.
I think you have totally misinterpreted the way these contracts work. Players are getting 14 million in there first year and 1 million when they are 42. Of course they will retire before their contract is over. They will have been paid the vast majority of their contract and it will be way over their cap hit.

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11-11-2012, 09:36 PM
  #41
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So they will be retiring for the good of the team? Because the team was hoping that would happen when they signed? No more Brett Favres hanging on their playing days as long as possible, they will be retiring because if they are only getting $1 mil, it wouldnt be worth it to play hockey and they have been so looking forward to retiring like most hockey players who just cant wait for their careers to end?

And some teams would have saved money by doing this. Fixing it will stop that? For how many players do you think this important change of making them pay bigger cap space contracts is being made. 5? 6?

Those teams will still be there and can still be penalized with cap space penalties equal to their ill-begotten gains if they try to pull such a stunt as retiring early from a tailing contract. And if they know beforehand that those penalties will exist and they still wish to take that risk, what consenting adults agree to behind closed doors shouldnt matter.

I can see perhaps 5 yr max if it starts in an rfa year. But ufa's shouldnt need restrictions.

If there is a max variance of 5% and 5 yr max contracts, all top ufas will be getting 5 yr cap max salaries. Leaving less cap space for non star players who will go back to taking a smaller percentage of the pie. Can every team in the league afford 5 year $14 mil/yr contracts for top ufa's?

How can the median not be about the split but about growth? Of course it affects the split, that's the point. It creates a lower cap and makes more teams contribute to revenue sharing a smaller amount.

There will always be a bottom team whether its median or mean team revenues used for calculating the cap. That wont affect growth. If enough low revenue teams improve their situation, there could even quickly come a time when the median is higher than the mean.

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11-11-2012, 09:57 PM
  #42
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Originally Posted by MrNasty View Post
I think you have totally misinterpreted the way these contracts work. Players are getting 14 million in there first year and 1 million when they are 42. Of course they will retire before their contract is over. They will have been paid the vast majority of their contract and it will be way over their cap hit.
Doesnt matter, it's all covered by escrow. If a player is getting more than his cap hit then in a cap system that money is coming from other players.

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11-11-2012, 10:20 PM
  #43
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Originally Posted by Ginu View Post
That's incorrect. There is more than one major problem with this league. Recognize that. The league is focusing on the wrong issues.

Player contracts beyond prevent cap circumvention are completely irrelevant vs. revenue sharing and fixing small market teams.

The league should be focusing on Make Whole and revenue sharing and cap circumvention.

The NHL wasted everyone's time. The NHLPA is playing hardball. For me, understandably. I don't want to be back here in 7 years when the NHL realizes they still haven't fixed their league.
I believe we will be with a league of idiot owners, players suffering from delusions of grandeur, and no one caring about the integrity of the game. its on the way out.

pick a new league or sport to be a hardcore fan of. with the US economy suffering with no end in sight, a gate driven league can not possible project growth. your are setting yourself up for frustration and disappointment sticking with this league

the NHL is a lost cause.

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11-11-2012, 10:53 PM
  #44
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And the PA has done nothing to help better the league. They can't... because the only real solution that will fix this long term means them taking a major hit on their share of HRR (median vs average revenue for HRR). The PA has a chance to mitigate their losses, however that means they actually have to start negotiating... something they haven't done to date. They really have no one to blame but themselves, and when this is eventually all said and done, will still come out as the losers due to the money they've already lost and will never recover.
Disagree.

League could have solved this mostly internally. Get the biggest franchises to pay significantly more into the revenue sharing pot.

Instead, the league (fairly understandably) wanted to maximize their shares of revenues by putting the onus on the players to contribute significantly.

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11-11-2012, 11:02 PM
  #45
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Originally Posted by Orrthebest View Post
There is about zero chance the PA accept that.
Why is that? It includes:

1) The NHL covering all salaries to make players whole at the owner's expense in exchange for 50-50 of HRR moving forward.

This is exactly what the players are asking for here.

2) Salary cap, which is already in place.

The only other two items:

3) 5% variance year to year on contracts

If the NHL forgets about all the other stuff - max contracts, change in arbitration and UFA age, etc. - the NHLPA would accept this single clause.

4) ~$250M of revenue sharing to help small market teams

The NHLPA's requested $260M. If the league offers $250M, that's close enough.

The players accept that deal.

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11-11-2012, 11:03 PM
  #46
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Originally Posted by Riptide View Post
The median isn't about the split of revenue, but the growth. The biggest issue the NHL has isn't that they're giving 57% to the players (although that certainly doesn't help things), but that Toronto's revenue has grown something like 40+% in 7 years, while other teams have only grown 20%. And that team A's 20% is only 15m, while team B's 40% is 80m. Using the median slows this aspect down. The NHL could give 55% of the median to the PA, and with some RS would still be healthier in 10 years than it has been in the last 5 years of this deal.

But instead Toronto's growth which is at an unequal rate to team B (both in % and $) is royally screwing with almost every other team in the league. And as has been shown multiple times, it doesn't matter who team B is, using average revenue always has a loser... even in a 3 team league of Toronto, New York Rangers and Montreal. Eventually whomever is on the bottom will have issues turning a profit.
As you know, since we've talked about before, the league's solution is to let Toronto keep even more of that money, asking the players to accept what the weakest can afford. In a way, this seems like the least fair solution to all sides.

To the point here though, as others have stated, a limit on the variance from year to year obviates the need for a term cap.

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11-11-2012, 11:03 PM
  #47
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Disagree.

League could have solved this mostly internally. Get the biggest franchises to pay significantly more into the revenue sharing pot.

Instead, the league (fairly understandably) wanted to maximize their shares of revenues by putting the onus on the players to contribute significantly.
Mostly internally? So what would they have needed from the PA?

However asking the NHL to foot the entire bill, would amount to something like a 50% tax (or more) on those team's profits. That's not realistic, and the league (rightly so) would never agree to it.

I have no issues with the league pumping in a bunch of RS money - in fact I think it should be closer to 20-30% instead of the 6.5% the NHL proposed. However they need some things from the PA... starting with a lower split.

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11-11-2012, 11:04 PM
  #48
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Originally Posted by Riptide View Post
And the PA has done nothing to help better the league. They can't... because the only real solution that will fix this long term means them taking a major hit on their share of HRR (median vs average revenue for HRR). The PA has a chance to mitigate their losses, however that means they actually have to start negotiating... something they haven't done to date. They really have no one to blame but themselves, and when this is eventually all said and done, will still come out as the losers due to the money they've already lost and will never recover.
The NHLPA has done nothing to help the league? They're the ones behind this whole revenue sharing thing. They made a strong statement that just rolling back player salaries as the NHL isn't going to solve this league's problems. Revenue sharing was made a big issue by the players for the betterment of the league. MOD


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11-11-2012, 11:07 PM
  #49
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Originally Posted by Ginu View Post
The NHLPA has done nothing to help the league? They're the ones behind this whole revenue sharing thing. They made a strong statement that just rolling back player salaries as the NHL isn't going to solve this league's problems. Revenue sharing was made a big issue by the players for the betterment of the league. MOD
And yet the amounts proposed still do very little long term (and are only 50m apart). And even the PA's proposal (if the NHL accepted exactly what they proposed) would still be in the exact same position at the end of this new CBA - as those offers will not prevent that from happening... they can't.

But then it's not like the NHLs proposals are any better in this regard. With the proposals we've seen, the NHLs is only slightly better for the long term health of the league then the PA's.

MOD


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11-12-2012, 12:44 AM
  #50
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The owners are fighting for the wrong things here. Why should they care how the 50% of HHR that the players will ultimately be paid under the new CBA is allocated? That's what they hire GMs to do. There's no logical reason to put any limitations on contracts in the new CBA if they're all subject to the 50-50 paradigm.

I say, the more DiPietro contracts the better. Let the poorly-run teams hang themselves out to dry.

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