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Should there be Revenue Sharing limits?

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Old
11-15-2012, 05:27 PM
  #176
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Originally Posted by SaintPatrick33 View Post
The NFL has won quite nicely by divvying up revenues nearly equally between all clubs. And they've rode that business model to become the most profitable sports league in the world.
Apples and oranges. The NFL divides up national TV money, money that all franchises contribute to with their local TV audiences. The NFL doesn't have nearly the same amount of loser franchises that the NHL does, and the ones the NFL does have are in trouble all the same.


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11-15-2012, 05:46 PM
  #177
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Originally Posted by Scurr View Post
Apples and oranges. The NFL divides up national TV money, money that all franchises contribute to with their local TV audiences. The NFL doesn't have nearly the same amount of loser franchises that the NHL does, and the ones the NFL does have are in trouble all the same.
Cleveland, Tampa in the old days, St. Louis except for a brief spurt about a decade ago, Detroit, KC, Washington . . . A lot of teams have briefs spurts of being competitive only to rapidly descend again to mediocrity with periods of mediocrity far exceeding in years their competitive eras. Go into the details of teams throwing up losing records for a decade or more; there are lots of them.

And if you use the national TV excuse, then you have to give room to the NHL to chase that contract. The facts of the increase in NHL national TV money deny your case that the chase is a failure. The chasing is ongoing and definitely showing progress.

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11-15-2012, 05:55 PM
  #178
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Originally Posted by Scurr View Post
Apples and oranges. The NFL divides up national TV money, money that all franchises contribute to with their local TV audiences. The NFL doesn't have nearly the same amount of loser franchises that the NHL does, and the ones the NFL does have are in trouble all the same.
Oh? News to me. Which NFL franchises are in trouble pray tell? Last time I checked ALL NFL franchises are in the black, courtesy of their revenue sharing policies. I'm sure it's news to the NFL too.

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11-15-2012, 07:33 PM
  #179
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Originally Posted by sandysan View Post
So just to be clear, when atlanta walked away from the thrashers that was an ownership issue but when the yotes went through bankruptcy, got bought by the NHL who kicked the tires on at least three different ownership groups and still could not find a suitor, then we cant pull the plug on the yotes because it would be bad PR ? The yotes dont have an owner now and havent for years, although i'm told that the jamison deal is going to close in a couple of weeks.

Its not surprising to me that bad markets attract bad owners. it seems to me that your argument that if you undergo rapid expansion and grant entrance into a bunch of non traditional markets that the league must throw good money after bad because admitting what everyone knows ( expansion too fast into iffy markets) and they must keep throwing money at this bottomless pit because the league cant come out and say they made a mistake.
The issue with the Yotes isn't that they can't get a deal done... none of the owners think they can make money/break even with the leases they've discussed with the COG. That's the main reason they haven't been sold yet.

If the NHL said, sure buy the team for 180m, and with another 90m as a relocation fee (if moved), you can relocate to a location of your choice (NHL has to approve location), the team would be sold overnight and re-located to Canada (take your pick - Hamilton, Toronto2/Markham, Quebec).

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11-15-2012, 09:14 PM
  #180
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Originally Posted by Riptide View Post
The issue with the Yotes isn't that they can't get a deal done... none of the owners think they can make money/break even with the leases they've discussed with the COG. That's the main reason they haven't been sold yet.

If the NHL said, sure buy the team for 180m, and with another 90m as a relocation fee (if moved), you can relocate to a location of your choice (NHL has to approve location), the team would be sold overnight and re-located to Canada (take your pick - Hamilton, Toronto2/Markham, Quebec).
So what does that say about the viability of the phoenix market? That even with a motivated seller ( the nhl) no one will pull the trigger in glendale.

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11-16-2012, 02:57 PM
  #181
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Originally Posted by Scurr View Post
No, I'm arguing against helping teams that aren't helping themselves. Giving teams handouts so they can keep running their teams poorly is not a conclusion, it only allows the real problem to continue longer.
You're just repeating the same thing over and over again. It's still not the reason they get revenue sharing. It's still not an issue SUPPOSED to be fixed by revenue sharing. It's still completely unrelated.

Before revenue sharing, there were teams taking on water. They had a hole in the bottom of the boat.
The rich aren't giving the poor revenue sharing to be a plug for that hole; they're giving the poor a bucket... because they are pouring more water on top of the boat with the salary floor.

The same teams are still losing money... because it's up to them to fix the hole. Same as before. The EXPECTED result of revenue sharing was the same as before.

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Originally Posted by Scurr View Post
If you take a look at the teams losing a lot of money they have two things in common, they haven't had sustained success on the ice and they've made poor business decisions off of it.
What teams are losing a lot of money? Phoenix -- who was driven into the ground by Moyes, and who?
The Islanders? Who don't get revenue sharing? The Islanders are the poster children for why you're wrong: The floor made them slash expenses everywhere but payroll. Scouting, Executives, Marketing, Radio. That is all revenue sharing is for: To keep THOSE EXPENSES from being cut when the payroll floor went up.
The Panthers and Sharks? The loss leader for their profitable arena business?

Give me a list of teams who shouldn't get revenue sharing because they "don't help themselves."

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Originally Posted by Scurr View Post
Nobody wins with giving revenue sharing to teams being run poorly except that inept owner.
Does Toronto keep more money with revenue sharing, or before the last CBA? By percentage, now.
Are the middle closer in payroll to the higher spending teams now, or before the last CBA? now.
Are the poor closer in payroll to the higher spending teams now, or before the last CBA? now.

That's called winning.

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Originally Posted by Scurr View Post
Apples and oranges. The NFL divides up national TV money, money that all franchises contribute to with their local TV audiences. The NFL doesn't have nearly the same amount of loser franchises that the NHL does, and the ones the NFL does have are in trouble all the same.
The NFL and NHL are totally apples to oranges. You're right.
However, the NFL doesn't have the "losers" because market size doesn't matter. Even without the TV contract (which all leagues share) the NFL has $5.3 billion in revenues and shares at least 40% of that.

LOCAL revenue shares for the NFL, NBA, and MLB are like 47%, 41% or 39% and 31% (doing that from memory, might be off). But the point is, it's a lot higher than 4.5%


Last edited by KevFu: 11-16-2012 at 03:10 PM.
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11-16-2012, 03:05 PM
  #182
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Originally Posted by KevFu View Post
What teams are losing a lot of money? Phoenix -- who was driven into the ground by Moyes, and who?
The Islanders? Who don't get revenue sharing? The Islanders are the poster children for why you're wrong: The floor made them slash expenses everywhere but payroll. Scouting, Executives, Marketing, Radio. That is all revenue sharing is for: To keep THOSE EXPENSES from being cut when the payroll floor went up.
If your own owner can't see fit to invest money in his own business, why should anyone else?


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Originally Posted by KevFu View Post
The Panthers and Sharks? The loss leader for their profitable arena business?

Give me a list of teams who shouldn't get revenue sharing because they "don't help themselves."
Islanders. Owner is a joke, runs his team like a fool, makes the whole league look bad.

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11-16-2012, 03:16 PM
  #183
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Originally Posted by Scurr View Post
Islanders. Owner is a joke, runs his team like a fool, makes the whole league look bad.
Have you actually looked at the hurdles he's had to surpass directly due to his lease? And the Islanders have not received any RS due to market restrictions.

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11-16-2012, 03:19 PM
  #184
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Quote:
Originally Posted by KevFu View Post
You're just repeating the same thing over and over again. It's still not the reason they get revenue sharing. It's still not an issue SUPPOSED to be fixed by revenue sharing. It's still completely unrelated.

Before revenue sharing, there were teams taking on water. They had a hole in the bottom of the boat.
The rich aren't giving the poor revenue sharing to be a plug for that hole; they're giving the poor a bucket... because they are pouring more water on top of the boat with the salary floor.

The same teams are still losing money... because it's up to them to fix the hole. Same as before. The EXPECTED result of revenue sharing was the same as before.



What teams are losing a lot of money? Phoenix -- who was driven into the ground by Moyes, and who?
The Islanders? Who don't get revenue sharing? The Islanders are the poster children for why you're wrong: The floor made them slash expenses everywhere but payroll. Scouting, Executives, Marketing, Radio. That is all revenue sharing is for: To keep THOSE EXPENSES from being cut when the payroll floor went up.
The Panthers and Sharks? The loss leader for their profitable arena business?

Give me a list of teams who shouldn't get revenue sharing because they "don't help themselves."



Does Toronto keep more money with revenue sharing, or before the last CBA? By percentage, now.
Are the middle closer in payroll to the higher spending teams now, or before the last CBA? now.
Are the poor closer in payroll to the higher spending teams now, or before the last CBA? now.

That's called winning.



The NFL and NHL are totally apples to oranges. You're right.
However, the NFL doesn't have the "losers" because market size doesn't matter. Even without the TV contract (which all leagues share) the NFL has $5.3 billion in revenues and shares at least 40% of that.

LOCAL revenue shares for the NFL, NBA, and MLB are like 47%, 41% or 39% and 31% (doing that from memory, might be off). But the point is, it's a lot higher than 4.5%
I'm not as familiar with NBA and MLB revenue practices but I am with the NFL. The way the NFL does business is the live gate is split 60/40 between the home and visiting teams, TV revenue is split equally between all clubs. The only thing that doesn't fall under the revenue sharing is income from luxury suites and there my knowledge may be dated as there's been rumbling for years about moving income from luxury suites under the revenue sharing and for all I know they may have already done it.


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11-16-2012, 03:36 PM
  #185
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Originally Posted by Scurr View Post
If your own owner can't see fit to invest money in his own business, why should anyone else?

Islanders. Owner is a joke, runs his team like a fool, makes the whole league look bad.
They ARE investing money in their business. It's the NHL telling them WHERE to invest it (players, due to the CBA).

All of those franchises losing money are losing money because of the league-mandated minimum payroll. All of those owners are writing personal cheques to cover the minimum payrolls.

The league minimum salary for a player is about $500,000. Teams like the Islanders or Blue Jackets could put an awful team on the ice for $15-$30 million before the cap/floor/revenue sharing.

Let's look at Columbus:
2002: $28 million payroll, +$6.0 million operating income
2003: $33 million payroll, +$3.8 million operating income.
2004: $36 million payroll, +$0.9 million operating income.

Hey look, revenue growth allowed them to increase spending and maintain a profit by managing their expenses in a responsible fashion! (Their point total rose from 57 to 69 as well!)

Now let's look what happens when the NHL CBA raises the minimum payroll:
2008: $43 mil payroll, -$7.1 mil operating income
2011: $56 mil payroll, -$13.7 mil operating income

As the floor rises, their expenses rise, their losses rise.


And I agree with you: Once the Islanders move into Barclays, they shouldn't get revenue sharing.
I think that revenue sharing should only go to teams who's leases prevent them from generating significant revenue.
That should have been the Islanders from 2006-2015, but not in Brooklyn. If the Islanders can't make money in Barclays, they shouldn't get revenue sharing. They'll have all the tools they need.

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11-16-2012, 04:26 PM
  #186
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Originally Posted by KevFu View Post
As the floor rises, their expenses rise, their losses rise.
If you haven't put a good product on the ice in 20 years and continue to put marginal NHL teams on the ice, yes you're going to struggle and lose money. I don't see the problem with that.

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Originally Posted by Riptide View Post
Have you actually looked at the hurdles he's had to surpass directly due to his lease? And the Islanders have not received any RS due to market restrictions.
Yes. I've also followed how he has chosen to run his franchise.

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11-16-2012, 04:31 PM
  #187
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If you haven't put a good product on the ice in 20 years and continue to put marginal NHL teams on the ice, yes you're going to struggle and lose money.
Ever heard of the Maple Leafs?

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11-16-2012, 04:40 PM
  #188
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Ever heard of the Maple Leafs?
They're the exception. I live in Vancouver, when we sucked they lost money. Burke came out and said the team could be moved with one phone call. Every team can't point to Toronto and say "I want what they have", it's not realistic. They didn't pay that kind of money for their franchise, nobody should be expecting that. If you run your franchise well, get some good players, have some success and build a fan base you can make a pretty good go of it in the NHL imo. Some teams need some help along the way, I think they should get it. Giving money to teams that lose a bunch because they're run poorly isn't the same thing.

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11-16-2012, 04:48 PM
  #189
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Players should be entitiled to way less than 50% imo. The owners spend all the money investing and developing the teams via Arenas, marketing, facilities, trademarks etc. The greedy players should be happy they are getting any cut period.

The players are employees & should be treated as such. The owners are owners and should be entitled to revenues. As if these guys don't get enough from NHL salary, endorsements, etc.

The NHL is a business, and owners have to be profitable for the NHL to survive. The system is broken and the players are the one's causing this with their greed. Not the owners, not Bettman, not the NHL.

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11-16-2012, 04:56 PM
  #190
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Originally Posted by Scurr View Post
If you haven't put a good product on the ice in 20 years and continue to put marginal NHL teams on the ice, yes you're going to struggle and lose money. I don't see the problem with that.
Good. That's what happens with revenue sharing.

With or without revenue sharing, poor teams having to be ridiculous smart and well-managed to overcome revenue-related disadvantages. There's teams that have done it, and those that haven't. And not doing isn't a reason to be ineligible for revenue sharing, because that's not what revenue sharing is there for.

You think of revenue sharing as welfare, and the teams who keep getting it over and over are not going out and looking for jobs.

The NHL Revenue Sharing system is more like a welfare system saying "in order to qualify for welfare, you have to own a suit for job interviews. But we're increasing your welfare check the cost of the suit."

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11-16-2012, 07:19 PM
  #191
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Players should be entitiled to way less than 50% imo. The owners spend all the money investing and developing the teams via Arenas, marketing, facilities, trademarks etc. The greedy players should be happy they are getting any cut period.

The players are employees & should be treated as such. The owners are owners and should be entitled to revenues. As if these guys don't get enough from NHL salary, endorsements, etc.

The NHL is a business, and owners have to be profitable for the NHL to survive. The system is broken and the players are the one's causing this with their greed. Not the owners, not Bettman, not the NHL.
Players are worth whatever someone will pay them, the same as you and I. Nobody is holding a gun to their heads, if the players aren't worth that money then by all means teams shouldn't offer it to them.

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11-16-2012, 07:27 PM
  #192
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The NHL Revenue Sharing system is more like a welfare system saying "in order to qualify for welfare, you have to own a suit for job interviews. But we're increasing your welfare check the cost of the suit."
That's not how I look at it. Revenue sharing should be seen as an investment from the rest of the league in the future of that franchise. They give now to get later. Smart investments are only made in well run companies.

Teams face hurdles, I know that. So did they when they bought them, and the price reflected those challenges. Overcoming those challenges usually offers significant benefit.

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11-16-2012, 07:43 PM
  #193
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Originally Posted by Scurr View Post
That's not how I look at it. Revenue sharing should be seen as an investment from the rest of the league in the future of that franchise. They give now to get later. Smart investments are only made in well run companies.

Teams face hurdles, I know that. So did they when they bought them, and the price reflected those challenges. Overcoming those challenges usually offers significant benefit.
Then the amount they are investing isn't no where near enough to get results. Not when the CBA imposes massive budget restrictions on the team.

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11-16-2012, 08:09 PM
  #194
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Then the amount they are investing isn't no where near enough to get results. Not when the CBA imposes massive budget restrictions on the team.
forcing teams to spend money is exactly what they need to do to make everyone in the league competitive and move the league forward. There should be more invest from big money teams in teams that are being run well, yes.

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11-16-2012, 10:47 PM
  #195
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forcing teams to spend money is exactly what they need to do to make everyone in the league competitive and move the league forward. There should be more invest from big money teams in teams that are being run well, yes.
You're after the European soccer model of no cap, no revenue sharing, pure Darwinism. Those leagues have no where else to go for more revenues, except to try and convert fans in the US into fans of their team.

That was the model that led to the demise of Winnipeg, Quebec, Minnesota and Hartford in the 1990s.

Also, under that scenario, why should the NHL protect the markets of the current franchises? If it's pure survival of the fittest, and teams in the league don't have a right to revenue sharing, why do other teams get the right of exclusivity? Shouldn't the Blue Jackets be able to say "I'm not making money here, I should be able to move to Toronto without rights fees?"

If "revenue sharing" was called the "annual territoral exclusive rights tax," paid to the league by every team at X percent of HRR, and the NHL had a "marketing and growth" fund of money they could hand out at their own discretion to further the league's efforts in growing popularity, would you have a problem with that?

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11-16-2012, 11:11 PM
  #196
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You're after the European soccer model of no cap, no revenue sharing, pure Darwinism.
If you completely ignored the points I was making you might come to that conclusion. I've said all along that it makes sense for the Toronto's of the world to invest in emerging markets to grow the game. I'm for revenue sharing, against owners doing a terrible job of running their franchise and then expecting to get bailed out when they lose money.

This league needs emerging markets to make further financial gains. They aren't going to see that until those markets put a good product on the ice and the league makes the on ice product better. Grinding players and asking for handouts is not a long term money making strategy, it's a poorly conceived, quick fix that stalls momentum gained. It sickens me that these guys throw their hands up in the air and blame everyone else for their losses. Look in the mirror, your league and often your team are a joke.


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11-17-2012, 12:40 AM
  #197
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Originally Posted by Scurr View Post
That's not how I look at it. Revenue sharing should be seen as an investment from the rest of the league in the future of that franchise. They give now to get later. Smart investments are only made in well run companies.

Teams face hurdles, I know that. So did they when they bought them, and the price reflected those challenges. Overcoming those challenges usually offers significant benefit.
Quote:
Originally Posted by Scurr View Post
If you completely ignored the points I was making you might come to that conclusion. I've said all along that it makes sense for the Toronto's of the world to invest in emerging markets to grow the game. I'm for revenue sharing, against owners doing a terrible job of running their franchise and then expecting to get bailed out when they lose money.
So how is St Louis or Colorado suppose to compete with Toronto (or any Canadian team for that matter)? The cap floor is driven by league revenues. For half the league, they'd have to grow their revenues at something like 1.5 times what the big clubs are doing just to stay at par. Now continue that indefinitely.

Without revenue sharing, and a cap floor that's rising independently from your internal revenue/budget, how do these teams not go broke? Being successful doesn't cut it, as that only increases the cap floor even more.

What you're saying is that these teams should get a hand up for a short period of time and then assuming that they're well run and successful, they should be able to survive on their own. Yet ignoring the fact that even if they are well run and successful (see Nashville for the perfect example), that still doesn't mean that their revenues will continue to grow at 1.5 times that of the bigger clubs that are driving the growth.

As long as the cap floor is tied to the average league revenues, then the guys at the bottom (regardless of who they are) will almost ALWAYS need RS to break even. How well run they are for the most part is irrelevant when you're telling Nashville, Columbus, Colorado, St Louis, etc to stay on par with the top teams.

Either drop the cap floor (which I do not think anyone wants), or buck up with the RS so that those teams that are not Toronto, NYR, Montreal, Vancouver, etc don't have to lose their shirt.

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11-17-2012, 12:21 PM
  #198
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Originally Posted by Riptide View Post
What you're saying is that these teams should get a hand up for a short period of time and then assuming that they're well run and successful, they should be able to survive on their own. Yet ignoring the fact that even if they are well run and successful (see Nashville for the perfect example), that still doesn't mean that their revenues will continue to grow at 1.5 times that of the bigger clubs that are driving the growth.
Eventually the big market teams will slow down, probably very soon, and the small market clubs will need to be driving the growth. Nashville is making gains, running their team well and gaining a fan base, there is light at the end of the tunnel for them. St.Louis has finally got back to putting a good product on the ice, they'll turn it around too.

The big market clubs are driving growth largely on them being so successful. Chicago, Pittsburgh, New York, Philly, Boston, LA... It was nice of a lot of small market clubs to do a terrible job to help that happen, they don't have to continue to do that. The cap was brought in with the promise it would help those small market teams compete. They now realize they also have to do a good job running their teams. Who knew?

What also drove growth, which nobody seems to notice, was a better product. IMO the league could make further gains with a continued emphasis on the product. Unfortunately, they focus on grinding the players instead.

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11-17-2012, 12:29 PM
  #199
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Originally Posted by Riptide View Post
So how is St Louis or Colorado suppose to compete with Toronto (or any Canadian team for that matter)? The cap floor is driven by league revenues. For half the league, they'd have to grow their revenues at something like 1.5 times what the big clubs are doing just to stay at par. Now continue that indefinitely.

Without revenue sharing, and a cap floor that's rising independently from your internal revenue/budget, how do these teams not go broke? Being successful doesn't cut it, as that only increases the cap floor even more.

What you're saying is that these teams should get a hand up for a short period of time and then assuming that they're well run and successful, they should be able to survive on their own. Yet ignoring the fact that even if they are well run and successful (see Nashville for the perfect example), that still doesn't mean that their revenues will continue to grow at 1.5 times that of the bigger clubs that are driving the growth.

As long as the cap floor is tied to the average league revenues, then the guys at the bottom (regardless of who they are) will almost ALWAYS need RS to break even. How well run they are for the most part is irrelevant when you're telling Nashville, Columbus, Colorado, St Louis, etc to stay on par with the top teams.

Either drop the cap floor (which I do not think anyone wants), or buck up with the RS so that those teams that are not Toronto, NYR, Montreal, Vancouver, etc don't have to lose their shirt.
Well, an easy way to do it would be to link to the median rather than the average HRR. It's such an easy fix I'm shocked it isn't being put on the table in the negotiations. Yet I've seen it mentioned numerous times on this very forum.

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11-17-2012, 01:55 PM
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Riptide
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Quote:
Originally Posted by SaintPatrick33 View Post
Well, an easy way to do it would be to link to the median rather than the average HRR. It's such an easy fix I'm shocked it isn't being put on the table in the negotiations. Yet I've seen it mentioned numerous times on this very forum.
I agree completely. However the NHL did try to get some modest and realistic exemptions into HRR, and the PA flipped. Trying to actually determine HRR by the median would never fly.

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