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The Business of Hockey Discuss the financial and business aspects of the NHL. Topics may include the CBA, work stoppages, broadcast contracts, franchise sales, and NHL revenues.

Spector: Don't get greedy, Gary (IOW if you get 50-50, give on contract details)

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Old
11-13-2012, 03:20 PM
  #76
echlfreak
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The problem is that the NHL can not figure out a system that works on their own. They claimed that the last lockout was the answer to all financial problems and now the complaint is we are still losing money and there is too much money going towards players contracts.

50/50 split saves the owners the amount of money that is going out to players contracts. They got what they wanted. The main reason for the lock out!

They get their 7% HRR savings...but its not enough. Now lets go after a players contracting rights. Not in a compromising way but a take it or leave it way. Over 5 years that saves the owners over ONE BILLION dollars...not millions but over a BILLION.

Once a players share is set at a fixed percentage why does it matter how much one player gets compared to the next. If they want to stall the process of how quickly a young player cashes in then COMPROMISE. Holding a gun to the heads of the players is no way to solve a problem.

The players have given in on every level of this negotiation which the owners stand only to gain.

What on any level on this CBA negotiation have the owners done to lean in the players favor? If this is a partnership then where is the partnership from the owners? With this kind of negotiating you can be 100% sure that at the expiration of this CBA that there will be another lockout!!!!!!!!!!!

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11-13-2012, 03:24 PM
  #77
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Some nontraditional markets have adopted & supported their teams, while others have not. The problem with many of these arguments is that everyone thinks it's the same problem in all the markets.
Not true. Everyone understands that the location of the Coyote franchise and a few other franchises may be problematic.

At least half of the teams DO NOT show a profit. That is a systemic problem, not one of franchise location.

People can cite increasing revenue all they want, the bottom line for the owners is profit.

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11-13-2012, 03:34 PM
  #78
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Fugu you want to look at it this way:

The owners are just like the owners of 30 restaurants. They all have their own bottom lines, profit margins and expenses. The only have to worry about their own staff and the money their own place brings in. Sure, they want to make more than the other guy but their profit is all that matters. If they turn a profit, great! If they lose money, cut costs that work for them. That is fine and great for most business.

However, the NHL is not most businesses. They ARE tied to one another. They are going after the same prize, the Cup. They not only have to be competitive cost wise, but they have to field a winning team to do so. They simply cant have bottom dollar players and expect to create fans, revenue and ultimately win the Cup.

To stay competitive, they sometimes have to go over budget to sign the player that helps them compete against the other clubs. When on GM exposes a loophole, other GMs are FORCED to do the same. That ultimately hurts the clubs bottom line. Because of that, you have to look at the NHL as a single entity. They will always be tied to one another. Unlike in a restaurant type business where there are not free agent cooks to go grab when they hit their prime, the NHL is talent driven and money wins out. Your bottom line just got moved because Player A decided to sign a long term deal that kills your books but works out fine for your cap hit.

In order to fix that NHL bottom line, it must be looked at as a single entity and the playing field needs to be leveled. Either though a limited variance in years of the deal or limiting the length of the deal.

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11-13-2012, 03:34 PM
  #79
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Quote:
Originally Posted by KINGS17 View Post
Not true. Everyone understands that the location of the Coyote franchise and a few other franchises may be problematic.

At least half of the teams DO NOT show a profit. That is a systemic problem, not one of franchise location.

People can cite increasing revenue all they want, the bottom line for the owners is profit.
I think echlfreak's post above sums up my feelings on it.

The owners got their 50% of HRR.

Why isn't that enough to address your profit concern?

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11-13-2012, 03:36 PM
  #80
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Quote:
Originally Posted by Hanklite View Post
Fugu you want to look at it this way:

The owners are just like the owners of 30 restaurants. They all have their own bottom lines, profit margins and expenses. The only have to worry about their own staff and the money their own place brings in. Sure, they want to make more than the other guy but their profit is all that matters. If they turn a profit, great! If they lose money, cut costs that work for them. That is fine and great for most business.

However, the NHL is not most businesses. They ARE tied to one another. They are going after the same prize, the Cup. They not only have to be competitive cost wise, but they have to field a winning team to do so. They simply cant have bottom dollar players and expect to create fans, revenue and ultimately win the Cup.

To stay competitive, they sometimes have to go over budget to sign the player that helps them compete against the other clubs. When on GM exposes a loophole, other GMs are FORCED to do the same. That ultimately hurts the clubs bottom line. Because of that, you have to look at the NHL as a single entity. They will always be tied to one another. Unlike in a restaurant type business where there are not free agent cooks to go grab when they hit their prime, the NHL is talent driven and money wins out. Your bottom line just got moved because Player A decided to sign a long term deal that kills your books but works out fine for your cap hit.

In order to fix that NHL bottom line, it must be looked at as a single entity and the playing field needs to be leveled. Either though a limited variance in years of the deal or limiting the length of the deal.
They have their cap and their linkage and now a lowered share for the players.

When is enough enough?

Change the variance so that the circumvention cannot be done. We're done then, right?

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11-13-2012, 03:38 PM
  #81
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Originally Posted by Fugu View Post
I think echlfreak's post above sums up my feelings on it.

The owners got their 50% of HRR.

Why isn't that enough to address your profit concern?
They still haven't gotten their HRR split of 50%...

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11-13-2012, 03:39 PM
  #82
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Quote:
Originally Posted by Hanklite View Post
Fugu you want to look at it this way:

The owners are just like the owners of 30 restaurants. They all have their own bottom lines, profit margins and expenses. The only have to worry about their own staff and the money their own place brings in. Sure, they want to make more than the other guy but their profit is all that matters. If they turn a profit, great! If they lose money, cut costs that work for them. That is fine and great for most business.

However, the NHL is not most businesses. They ARE tied to one another. They are going after the same prize, the Cup. They not only have to be competitive cost wise, but they have to field a winning team to do so. They simply cant have bottom dollar players and expect to create fans, revenue and ultimately win the Cup.

To stay competitive, they sometimes have to go over budget to sign the player that helps them compete against the other clubs. When on GM exposes a loophole, other GMs are FORCED to do the same. That ultimately hurts the clubs bottom line. Because of that, you have to look at the NHL as a single entity. They will always be tied to one another. Unlike in a restaurant type business where there are not free agent cooks to go grab when they hit their prime, the NHL is talent driven and money wins out. Your bottom line just got moved because Player A decided to sign a long term deal that kills your books but works out fine for your cap hit.

In order to fix that NHL bottom line, it must be looked at as a single entity and the playing field needs to be leveled. Either though a limited variance in years of the deal or limiting the length of the deal.
Pretty much.

The "GMs are stoooopid, lol, they should just spend less money" is a cop-out.

When you're faced with Shea Weber leaving and your franchise basically being devastated for the next 5-10+ years, you have to pay up.

And then he's going to want help. So then you have to pay more.

The NHL is trying to make a system that's functional for all their franchises, not just a system that works great for Philly and Toronto.

The market will always favor the players unless the owners are explicitly allowed to collude with each other.

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11-13-2012, 03:45 PM
  #83
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Quote:
Originally Posted by Fugu View Post
They have their cap and their linkage and now a lowered share for the players.

When is enough enough?

Change the variance so that the circumvention cannot be done. We're done then, right?
Changing the variance will help out, definitely.

But to think that a CBA signed 7/8/9 years ago will remain relevant is naive. Economic conditions change: sponsors, dollar rates, etc.

The owners are looking for a system that helps out and contract lengths help. Signing Player A to a 15 year deal is awful for the game. What happens when Player A starts to perform more like Player B who gets paid 50% of what Player A makes?

How is that good for the game, the product and the overall revenue of the league?

Shorter deals mean only the players in their prime get the contracts they deserve. Nobody can predict the effectiveness of a certain player that far down the road.

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11-13-2012, 03:47 PM
  #84
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I ****ing hate the owners. I wish Sid would tell Mario to **** himself.

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11-13-2012, 03:59 PM
  #85
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Quote:
Originally Posted by Hanklite View Post
Changing the variance will help out, definitely.

But to think that a CBA signed 7/8/9 years ago will remain relevant is naive. Economic conditions change: sponsors, dollar rates, etc.

The owners are looking for a system that helps out and contract lengths help. Signing Player A to a 15 year deal is awful for the game. What happens when Player A starts to perform more like Player B who gets paid 50% of what Player A makes?

How is that good for the game, the product and the overall revenue of the league?

Shorter deals mean only the players in their prime get the contracts they deserve. Nobody can predict the effectiveness of a certain player that far down the road.
You're moving goalposts, Hankie.


We have moved past the need for some economic changes. The PA accepted that on their own, and even got the league to up its RS and add a special targeted assistance fund.


What more is needed? I said addressing the variance issue should resolve anything and everything that all teams need right now to have a good footing. You don't need to restrict player rights. They should get some ability to control their own destinies above and beyond the league's required economic changes.

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11-13-2012, 04:09 PM
  #86
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Quote:
Originally Posted by Hanklite View Post
Changing the variance will help out, definitely.

But to think that a CBA signed 7/8/9 years ago will remain relevant is naive. Economic conditions change: sponsors, dollar rates, etc.

The owners are looking for a system that helps out and contract lengths help. Signing Player A to a 15 year deal is awful for the game. What happens when Player A starts to perform more like Player B who gets paid 50% of what Player A makes?

How is that good for the game, the product and the overall revenue of the league?

Shorter deals mean only the players in their prime get the contracts they deserve. Nobody can predict the effectiveness of a certain player that far down the road.
It isn't about what's good for the game, it's about standing up to the fatcats!

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11-13-2012, 04:09 PM
  #87
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Originally Posted by Hanklite View Post
They still haven't gotten their HRR split of 50%...
The 50/50 split has been agreed to. It is just a matter of how quickly they get to 50/50. In order to get to 50/50 FAIRLY a step down method needs to happen.

Last CBA the players got 75% of revenues and no salary cap. Next a roll back, salary cap and 57% of HRR. They very easily could have gone into negotiations and said we want to go back closer to 75% but they didn't...and they didn't go after the salary cap which although would hurt teams ability to compete it would on the other hand solve financial difficulties for the less wealthy teams ex no cap floor to reach. Teams could spend based on what they could afford. After all this lockout is about $$$

Truth is the players have not gone after the cap and they have not gone after a greater share of revenues. They have proposed greater revenue sharing which will HELP the weaker teams AND they have proposed a step down system to get to 50/50 to yet again give the NHL a bigger piece of revenue (Over a Billion at a mere 5% revenue growth).

The players have tried to fix a broken financial system in a way which doesn't require another lock out in 5 years. Owners first proposal did nothing to change the system they merely wanted a reset in salaries. Who in their right mind creates a financial system which provides losses and then desires a simple reset of values under the same system which lost them money in the first place???



50/50 and Revenue Sharing solves the financial problems that the NHL needs. They get their 50% share compared to 43%. They have a chance to growth their business and gain a guaranteed 7% more every year. It should not matter at all how the players divide their share. Escalating second contracts need to be solved and it can be via a 2 year ELS?

The NHL is using a lock out to bully instead of negotiating FAIRLY and honorably. The NHL doesn't care that the players are losing money nor should they I guess? but they don't care about the NHL employees who are taking pay cuts and or getting terminated either...their OWN people.

OWNERS got their money there is no reason to further lock things out except GREED and POWER!

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11-13-2012, 04:10 PM
  #88
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You're moving goalposts, Hankie.


We have moved past the need for some economic changes. The PA accepted that on their own, and even got the league to up its RS and add a special targeted assistance fund.


What more is needed? I said addressing the variance issue should resolve anything and everything that all teams need right now to have a good footing. You don't need to restrict player rights. They should get some ability to control their own destinies above and beyond the league's required economic changes.
What goalposts have been moved?

The end result is still aimed economic success for the league and its owners.

Contract terms are a part of that.

You didn't address my concerns with long term deals at all. How is paying Joe Blow $7M a year for 15 years good for the game, and the revenue of the league? What happens when Joe Blow busts his knee and can't play at that high level again, yet doesn't retire. Is paying him $7M a year for the next 14 years good for anybody, besides that player?

You want no restrictions on contract length, then you have to get rid of guaranteed contracts.

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11-13-2012, 04:17 PM
  #89
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San Jose Sharks.
... won the franchise-building lottery when they were gifted a prime-aged, Hart-winning center in exchange for spare parts. How wonderful for them, but not applicable as a universal model.

Where do you think the Sharks would be budgetarily for the past 5 years if they had to acquire that player as a UFA?


Quote:
There is never a rational reason for spending more than you can afford.
"Afford" is the key word here. Teams are frequently in a situation where they choose to spend more than they can afford, simply because they can't afford NOT to spend it.

You can deny the connections here till you're blue in the face. But teams have to spend on salary to compete, and that's the truth.

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11-13-2012, 04:22 PM
  #90
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One problem we don't mention enough. In general, professional sports are crappy business. Even in successful situations, the teams themselves are often a loss leader.

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11-13-2012, 04:24 PM
  #91
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Originally Posted by echlfreak View Post
The 50/50 split has been agreed to. It is just a matter of how quickly they get to 50/50. In order to get to 50/50 FAIRLY a step down method needs to happen.

Last CBA the players got 75% of revenues and no salary cap. Next a roll back, salary cap and 57% of HRR. They very easily could have gone into negotiations and said we want to go back closer to 75% but they didn't...and they didn't go after the salary cap which although would hurt teams ability to compete it would on the other hand solve financial difficulties for the less wealthy teams ex no cap floor to reach. Teams could spend based on what they could afford. After all this lockout is about $$$

Truth is the players have not gone after the cap and they have not gone after a greater share of revenues. They have proposed greater revenue sharing which will HELP the weaker teams AND they have proposed a step down system to get to 50/50 to yet again give the NHL a bigger piece of revenue (Over a Billion at a mere 5% revenue growth).

The players have tried to fix a broken financial system in a way which doesn't require another lock out in 5 years. Owners first proposal did nothing to change the system they merely wanted a reset in salaries. Who in their right mind creates a financial system which provides losses and then desires a simple reset of values under the same system which lost them money in the first place???



50/50 and Revenue Sharing solves the financial problems that the NHL needs. They get their 50% share compared to 43%. They have a chance to growth their business and gain a guaranteed 7% more every year. It should not matter at all how the players divide their share. Escalating second contracts need to be solved and it can be via a 2 year ELS?

The NHL is using a lock out to bully instead of negotiating FAIRLY and honorably. The NHL doesn't care that the players are losing money nor should they I guess? but they don't care about the NHL employees who are taking pay cuts and or getting terminated either...their OWN people.

OWNERS got their money there is no reason to further lock things out except GREED and POWER!
Not yet, but how do we know if they will if the NHL keeps throwing away their delinked raises proposals?

So paying injured players star player money is not a long term financial concern? What happens when a team has 33% of their cap room for the next 10 years allocated to injured players, who still try to make a living in the NHL?

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11-13-2012, 04:24 PM
  #92
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What goalposts have been moved?

The end result is still aimed economic success for the league and its owners.

Contract terms are a part of that.

You didn't address my concerns with long term deals at all. How is paying Joe Blow $7M a year for 15 years good for the game, and the revenue of the league? What happens when Joe Blow busts his knee and can't play at that high level again, yet doesn't retire. Is paying him $7M a year for the next 14 years good for anybody, besides that player?

You want no restrictions on contract length, then you have to get rid of guaranteed contracts.

Nothing forces any team to give out that kind of contract. They actually have ironclad, legitimate business grounds to cite, like risk and insurance cost.

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11-13-2012, 04:25 PM
  #93
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Quote:
Originally Posted by Hanklite View Post
What goalposts have been moved?

The end result is still aimed economic success for the league and its owners.

Contract terms are a part of that.

You didn't address my concerns with long term deals at all. How is paying Joe Blow $7M a year for 15 years good for the game, and the revenue of the league? What happens when Joe Blow busts his knee and can't play at that high level again, yet doesn't retire. Is paying him $7M a year for the next 14 years good for anybody, besides that player?

You want no restrictions on contract length, then you have to get rid of guaranteed contracts.





Does a BILLIONAIRE OWNER really need a rule in place to stop him offering a 7 year contract??? Just don't offer the damn thing in the first place...problem is the OWNERS offer these contracts and then say "Hey that contract is too long or too much" HYPOCRITES!!!

An don't say well if they don't do it that they can't compete! Ryan Suter is a great D but far from worth 10M...Minnesota would have been better off with 2 $5M D than 1 $10M D...that is their own fault!!! Even if you think that they still need to do that to compete, you don't financial bankrupt your team because you have to win. Its a gamble...you either try to win and pay the price or you take a different approach maybe win and save yourself financially!!!!!!

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11-13-2012, 04:28 PM
  #94
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Originally Posted by echlfreak View Post
Does a BILLIONAIRE OWNER really need a rule in place to stop him offering a 7 year contract??? Just don't offer the damn thing in the first place...problem is the OWNERS offer these contracts and then say "Hey that contract is too long or too much" HYPOCRITES!!!

An don't say well if they don't do it that they can't compete! Ryan Suter is a great D but far from worth 10M...Minnesota would have been better off with 2 $5M D than 1 $10M D...that is their own fault!!! Even if you think that they still need to do that to compete, you don't financial bankrupt your team because you have to win. Its a gamble...you either try to win and pay the price or you take a different approach maybe win and save yourself financially!!!!!!
For you can not see the forest for the trees...

Oh hey that's fine, go ahead and sign your star player to a lifetime contract, I will just hope mine stays with me for his entire career with these 2/3 year deals...
("So my buddy Ovechkin just got a 13-year deal. I want that same deal or else I am leaving this club")

The NHL is tied to each individual club. One owners actions impact everybody else.

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11-13-2012, 04:30 PM
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Nothing forces any team to give out that kind of contract. They actually have ironclad, legitimate business grounds to cite, like risk and insurance cost.
Then why not just eliminate them altogether? Why even have that option? What is the value to the league, the team and the fans?

The only entity that benefits is the Player himself.

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11-13-2012, 04:35 PM
  #96
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Then why not just eliminate them altogether? Why even have that option? What is the value to the league, the team and the fans?

The only entity that benefits is the Player himself.

Because the current NHL proposed method forces a third contract into the mix when there's no legitimate reason for players to concede that point. There are plenty of salary restraints in the system already, as a whole. You shouldn't have to mandate it down to the level of every single player. That's why you have GMs-- to assess and valuate talent properly.

The ones who consistently fail shouldn't be rewarded by restricting player options unduly.

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11-13-2012, 04:37 PM
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... won the franchise-building lottery when they were gifted a prime-aged, Hart-winning center in exchange for spare parts. How wonderful for them, but not applicable as a universal model.
Joe Thornton is (or was) a superstar, no question, but there is (and was) a lot more to the Sharks' success on the ice than Big Joe. The goal tending depth (Nabokov + Kipursoff/Toskala?), for one, and all of it home grown.

The universal model is draft well, develop, keep your stars and supplement with the right FAs. That's how many of the top echelon teams have done it post the 04-05 lockout (Kings, Blues, Canucks, Penguins, Bruins) and it doesn't require a Kovalchuk blockbuster to do it.

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11-13-2012, 04:40 PM
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Because the current NHL proposed method forces a third contract into the mix when there's no legitimate reason for players to concede that point. There are plenty of salary restraints in the system already, as a whole. You shouldn't have to mandate it down to the level of every single player. That's why you have GMs-- to assess and valuate talent properly.

The ones who consistently fail shouldn't be rewarded by restricting player options unduly.
Wouldn't it allow the GMs to get a better assessment of that talent? How is that bad for the game. You are only looking at it being bad for a TINY percentage of NHL players. The NHLPA loves to claim they want to improve the league and help out teams, well this would help immensely. Saying a kid, a 21 year old, is going to be putting up numbers until he is 35 is a huge forecast to make.

Having more talent on your team means more fans in the seats and more revenue.

The current system only helps Star players get guaranteed money no matter how well they perform the future.

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11-13-2012, 05:01 PM
  #99
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An don't say well if they don't do it that they can't compete! Ryan Suter is a great D but far from worth 10M...Minnesota would have been better off with 2 $5M D than 1 $10M D...that is their own fault!!!
Missing the forest for the trees is right.

Ok, let's ASSUME that you're right here... they would be a better team with the one-two punch of Matt Carle and Dennis Wideman than with Ryan Suter. I mean, none of us likely believe that is true. But let's accept it anyway.

Let's also accept that the fans wouldn't be irate that a team in perfect position to court a Suter would instead intentionally settle for Carle/Wideman. Just assume that there is no backlash from this.

So, the Wild decide to pursue these two ~$5m defensemen. Well, here's the problem. Wideman and Carle ALREADY had those offers on the table without the Wild's involvement. So for Minnesota to make a winning offer, they have to outbid those contracts, and the total is now creeping upward.

So to get "two $5m defensemen" they really need to be looking at $4m defensemen, whose salaries they can inflate to equal $10m. "Hey, we didn't get Suter but check out our sick Souray/Kuba combo! Great seats are still available, call now for prices!"

Meanwhile Detroit picks up Suter at $9m and Wild fans are red in the face with management.

That is what you're recommending when you propose that teams ignore the constant upward salary pressure and pretend that they can just overpay even MORE mediocre UFAs to get the same results.

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11-13-2012, 05:04 PM
  #100
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I ****ing hate the owners. I wish Sid would tell Mario to **** himself.
how do you know mario's position in all of this?

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