HFBoards

Go Back   HFBoards > General Hockey Discussion > The Business of Hockey
Mobile Hockey's Future Become a Sponsor Site Rules Support Forum vBookie Page 2
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.

Average Ticket Cost vs. Average Player Salary - 1994 to 2012

Reply
 
Thread Tools
Old
11-24-2012, 01:50 PM
  #26
SJeasy
Registered User
 
SJeasy's Avatar
 
Join Date: Feb 2005
Location: San Jose
Country: United States
Posts: 12,346
vCash: 500
Quote:
Originally Posted by robla View Post
and what? even if the ticket prices have been increased by 140% .. it's still a huge way behind the fixed costs increase by players salaries.. and further disturbing: ticket revenues are not fixed per team.. a bad year and they are down.
everyone knows that the NHL is a gate revenue league.. it doesn't have the huge tv contracts like NFL and MLB.. and never will since it's a niche sport in the US.. it has to generate most of its revenues from ticket sales.. these numbers show that the NHL business isn't working with high player salaries or even worse increasing salaries.. but heck, the players keep on dreaming/living in wonder land.. fighting their employer.. till they ruined their employer's business.. they will cry wolf when there's no league left to pay their high salaires :-) looks like this day will come sooner than later...
I believe that the net of the TV contracts has a lot to do with the change of net salary in relation to average ticket price. In the same time period, the league went from near zero to well above $500mil if you include RSN income. There is also an emphasis on luxury boxes as well. The league is getting a second income stream even if it doesn't match NBA, MLB or NFL. It isn't nothing and it is growing . . . a lot.

Someone had the net revenue of the league from the early 90s. It would probably help if it were posted here so we could have the comparison.

SJeasy is offline   Reply With Quote
Old
11-24-2012, 01:51 PM
  #27
KINGS17
Smartest in the Room
 
KINGS17's Avatar
 
Join Date: Apr 2006
Country: United States
Posts: 15,553
vCash: 500
Quote:
Originally Posted by Fugu View Post
They already gave to that charity last time.
Ok, so why isn't Fehr telling them that they have two choices:

1) They can insist on getting paid a higher percentage of revenue than any other major sport, and expect to lose about a 20% of the union members' jobs.

OR

2) They can take a percentage that is more in line with other sports, insist on increased revenue sharing among the owners, and keep most if not all of their jobs.

The charity you are talking about are the jobs of other union members.

KINGS17 is offline   Reply With Quote
Old
11-24-2012, 01:57 PM
  #28
Fugu
Administrator
HFBoards
 
Fugu's Avatar
 
Join Date: Nov 2005
Location: Pac NW
Country:
Posts: 29,706
vCash: 500
Quote:
Originally Posted by KINGS17 View Post
Ok, so why isn't Fehr telling them that they have two choices:

1) They can insist on getting paid a higher percentage of revenue than any other major sport, and expect to lose about a 20% of the union members' jobs.

OR

2) They can take a percentage that is more in line with other sports, insist on increased revenue sharing among the owners, and keep most if not all of their jobs.

The charity you are talking about are the jobs of other union members.

No, the NHL has a fixed number of player spots. Roughly 22 per team, plus extras/injury replacements.

The only issue for the union is how that money gets rearranged between them. I know I believe each should get what they can rightfully earn, with as little artificial interference as possible. That puts all players on the same playing field. If you're not Crosby, why would you think he should make less so you should make more? (You may want that to be the case, but that doesn't make it right.)

As for #2, I like billybudd's reply to your other post on the same vein, so I won't reinvent the wheel here:

Quote:
Originally Posted by billybudd View Post
I don't know about that second paragraph. The raw percentage of some arbitrary net is neither sustainable nor unsustainable on its own no matter what the percentage. Depends on what other factors do.

As a hypothetical, if the NHL had 100% revenue sharing, each team would make $8 million per year right now (and that's if you believe the NHL's most pessimistic numbers about its own profits, which I personally don't). That's not unsupportable by any means, particularly while franchise values are also rising. And that dollar value profit only goes down if operating costs outstrip growth. Which means everybody's arena lease (and everything else) would need to increase by about 8% per year before 57% became unsustainable in the long run.

There isn't a lockout because "good lord, 57% is TOO MUCH FOR US TO PAY!!!1" There's a lockout because the owners think they have the leverage to reduce that share and fly the asymmetrical growth albatross 5 years into the western sky.

Fugu is online now   Reply With Quote
Old
11-24-2012, 02:00 PM
  #29
KINGS17
Smartest in the Room
 
KINGS17's Avatar
 
Join Date: Apr 2006
Country: United States
Posts: 15,553
vCash: 500
Quote:
Originally Posted by Fugu View Post
No, the NHL has a fixed number of player spots. Roughly 22 per team, plus extras/injury replacements.

The only issue for the union is how that money gets rearranged between them. I know I believe each should get what they can rightfully earn, with as little artificial interference as possible. That puts all players on the same playing field. If you're not Crosby, why would you think he should make less so you should make more? (You may want that to be the case, but that doesn't make it right.)

As for #2, I like billybudd's reply to your other post on the same vein, so I won't reinvent the wheel here:
There won't be 30 teams in "your NHL". That's a loss of "Folded Teams" x 24/25 jobs per team.

KINGS17 is offline   Reply With Quote
Old
11-24-2012, 02:51 PM
  #30
Phu
Registered User
 
Join Date: May 2010
Posts: 6,778
vCash: 500
Contraction means less games (revenue) for the high-end teams as well. There is more money to be made with 30 teams than fewer; the NHL just has to get over its own bs rhetoric and make 30 teams sustainably viable. Everyone wins. With only the big guns winning, as we see in the US economy, it's a downward spiral with the workers (players) especially always losing out.

Phu is offline   Reply With Quote
Old
11-24-2012, 03:05 PM
  #31
Freudian
Patty likes beef
 
Freudian's Avatar
 
Join Date: Jul 2003
Country: Sweden
Posts: 29,194
vCash: 50
Mark Spector writes about league profitability and player salaries:

"That does not mean, however, that there are no repercussions for draining far more from the game than one's value as a player deems appropriate. As a whole, that's what players have done: Taken more from the coffers than the game can afford to give them over the years, and now the pendulum swings back.

The players, since about 1990, have always won on the salary front. Even in 2004-05, it turns out, they made out better than anyone could have dreamed. Now, the players are losing one of these battles, and it's all about "unfair practices" and "an unwilling partner."

Look, the owners are greedy. This is their lockout, their fault. They dug this economic hole with a series of bad decisions -- almost all of which benefited the players.

But hockey players who think they should be paid like baseball and basketball players, despite the disparity in the NHL's U.S. TV money, need a reality check. The economy does not support that, and even a sports writer can see it."

Freudian is offline   Reply With Quote
Old
11-24-2012, 03:50 PM
  #32
thinkwild
Veni Vidi Toga
 
thinkwild's Avatar
 
Join Date: Jul 2003
Location: Ottawa
Country: Canada
Posts: 8,279
vCash: 500
The players didnt make out better than anyone could've dreamed of in the last cba - they made out exactly as expected looking at the linkage numbers. Which was about 10-15 percentage points less than they were previously getting - a huge loss.

The fact that revenues grew so much might have been hard to believe for those who really believed that linkage was to save the owners in case revenues tanked and that such a demonstration of the truth of the nhls propaganda would finally be imminent when the owners were no longer forced to raise ticket prices to meet the players ever spiraling demands.

Quote:
Originally Posted by BonkTastic View Post
I posted this in the lockout thread, but thought maybe it deserved it's own thread.


I was looking at some comparisons between the "Original Bettman Lockout" (1994-95), and this year's lockout. I came across some interesting numbers:

Average NHL Ticket Price in 1994-95: $33.49
Average NHL Ticket Price in 2011/12: $57.10
Difference: 70% increase in ticket cost over 17 years.

Average NHL Player Salary in 1994/95: $572,000 (this is the FULL-SEASON-prorated figure to reflect actual games played. Players in reality earned less than this, due to the shortened schedule)
Average NHL Player Salary in 2011-12: $2,450,000
Difference: 425% increase in average player salaries over 17 years.

Interesting numbers. This shouldn't paint a full picture of anything, I'm just putting them out there. Feel free to interpret these however you want.

Dissect at your own leisure.
There really doesnt seem much to dissect there. If you actually had access to good data, there would be far more interesting hypotheses to advance with it.

On the surface, it seems that mean salaries grew far faster than average ticket prices. We arent exactly sure what average ticket prices represents. Are $250,000 suites at ACC considered ticket prices?

Looking at salaries, it might be informative to see the difference in growth between mean and median salary, pre-cap and post. Since 2005, the mean salary appears to have increased far faster than the median which suggests much more salary equalization between top and bottom. The kind of disparity changes the occupy movement seeks for a better society. Amongst the teams themselves though, the opposite seems to have occurred.

Perhaps one other thing we might take from the general concept of these suspect context numbers is that it is no longer correct to consider the nhl a gate driven league since gate accounts for less than 50% of total revenues now.

thinkwild is offline   Reply With Quote
Old
11-24-2012, 04:22 PM
  #33
Killion
Global Moderator
 
Killion's Avatar
 
Join Date: Feb 2010
Location: Morocco
Country: Morocco
Posts: 22,098
vCash: 500
Quote:
Originally Posted by thinkwild View Post
Are $250,000 suites at ACC considered ticket prices?
... you also have that little matter of Seat License Fee's at the ACC, whereby you first had to drop thousands in order to buy the rights buy the tickets. Like "Key Fee's" if you wanna rent a semi decent apartment in NYC.

Killion is offline   Reply With Quote
Old
11-24-2012, 06:27 PM
  #34
Riptide
Moderator
 
Riptide's Avatar
 
Join Date: Dec 2011
Location: Yukon
Country: Canada
Posts: 8,775
vCash: 500
Quote:
Originally Posted by Fugu View Post
Back to revenue disparity. The NHL's proposal is worse. They still want their inflationary cap range system with linkage, which once again will spiral out of control for the bottom teams. The league IGNORES revenue disparity, with the only solution they seem interested in is lowering the players' take to the affordability level of the lowest team. That the wealthiest teams pocket their gains, unfairly and against any market principle that most businesses have to deal with, but that doesn't seem to bother you one bit. There is greed here, but you cannot see the worst case of it.
And other than putting the cap floor/ceiling on a % basis, what does the PA's proposal do differently that makes it better?

__________________
"Itís not as if Donald Fehr was lying to us, several players said. Rather, itís as if he has been economical with information, these players believe, not sharing facts these players consider to be vital."
Riptide is offline   Reply With Quote
Old
11-24-2012, 09:53 PM
  #35
DuklaNation
Registered User
 
DuklaNation's Avatar
 
Join Date: Aug 2004
Posts: 2,827
vCash: 500
Would be better do it as total revenue from tickets vs total cost for salaries.

DuklaNation is offline   Reply With Quote
Old
11-25-2012, 08:28 AM
  #36
barneyg
Registered User
 
Join Date: Apr 2007
Posts: 2,234
vCash: 500
Quote:
Originally Posted by thinkwild View Post
Perhaps one other thing we might take from the general concept of these suspect context numbers is that it is no longer correct to consider the nhl a gate driven league since gate accounts for less than 50% of total revenues now.
100% agree with this.

but the numbers still aren't credible for reasons kdb posted

Quote:
Originally Posted by thinkwild View Post
Looking at salaries, it might be informative to see the difference in growth between mean and median salary, pre-cap and post. Since 2005, the mean salary appears to have increased far faster than the median which suggests much more salary equalization between top and bottom. The kind of disparity changes the occupy movement seeks for a better society. Amongst the teams themselves though, the opposite seems to have occurred.
Given the NHL's salary structure it's actually the opposite -- if the mean increases more quickly than the median then there are more inequalities, not less.

barneyg is offline   Reply With Quote
Old
11-25-2012, 09:36 AM
  #37
ScottyBowman
Registered User
 
Join Date: Mar 2003
Location: Detroit
Country: United States
Posts: 1,983
vCash: 500
One misconception is the lack of a big tv contract. While that is true in a national perspective, the introduction of the RSN's have been very friendly to the teams. The Red Wings get at least $25 mil per year from Fox Sports Detroit. That kind of stuff didn't exist or was in its infancy back in 1994.

ScottyBowman is offline   Reply With Quote
Old
11-25-2012, 01:05 PM
  #38
Fugu
Administrator
HFBoards
 
Fugu's Avatar
 
Join Date: Nov 2005
Location: Pac NW
Country:
Posts: 29,706
vCash: 500
Quote:
Originally Posted by KINGS17 View Post
There won't be 30 teams in "your NHL". That's a loss of "Folded Teams" x 24/25 jobs per team.
Would you answer my post that you quoted?

On this matter, maybe there isn't enough money to support your 30 teams.

Quote:
Originally Posted by Riptide View Post
And other than putting the cap floor/ceiling on a % basis, what does the PA's proposal do differently that makes it better?
The PA never wanted this system in the first place. It's really not up to the PA to solve the league's economic problems and strategic decisions, but they probably realize that getting Bettman to accept the cap range system is fool's folly isn't going to happen easily (if at all).

Quote:
Originally Posted by juantimer View Post
Contraction means less games (revenue) for the high-end teams as well. There is more money to be made with 30 teams than fewer; the NHL just has to get over its own bs rhetoric and make 30 teams sustainably viable. Everyone wins. With only the big guns winning, as we see in the US economy, it's a downward spiral with the workers (players) especially always losing out.

Really? Teams in the 70's played 72-76 games, iirc. There weren't 30 teams at that time.

You can have the same number of games played even if you have fewer teams. Since the remaining teams earn more revenue per game, the net result would be higher revenue.

Fugu is online now   Reply With Quote
Old
11-25-2012, 01:40 PM
  #39
thinkwild
Veni Vidi Toga
 
thinkwild's Avatar
 
Join Date: Jul 2003
Location: Ottawa
Country: Canada
Posts: 8,279
vCash: 500
Quote:
Originally Posted by Charon View Post
If only most of the fans could afford the same luxury - to retire comfortably at 35 because they don't like their boss.
Well you do have that luxury. All you have to do is become an NHL'er; it's a free country, nothing is stopping you.

I really dont find anything noble about this rather common opinion that the players make so much money that their concerns in this cba should be dismissable and subordinate to our fan desire for uninterrupted tv viewing. Especially on a business board, it's pettiness seems rather out of place and misfocused.

The owners are certainly taking these collectively bargained negotiations very seriously and have hired an army of top lawyers to deal with it. We as fans, at least before, were on pace to contribute about $20 Bil over the next 5 years into a pot of money for them to split. And for Bettman this is all about being able to say:

But i got the bigger half.

The players are forced into making a business decision here, it's not fun. Just surrendering because they make so much money already, is not wise, nor I would suggest how the majority of you would see things if you had worked to put yourself in that situation.

Its definitely understandable though how many fans will feel that way, and so players should probably know that when tweeting. But its not a noble view of fans, its a petty one.

Quote:
Originally Posted by barneyg View Post
Given the NHL's salary structure it's actually the opposite -- if the mean increases more quickly than the median then there are more inequalities, not less.
I did get that backwards didnt i. Im trying to remember the 2004 numbers, they were posted here. The mean salary was about $1.6 or $1.8 mil or something and the median about $1.1. At that time, the top ufa's were signing in a range of Heatley's $7.5 mil to Crosbys $8.7 mil as the top salary as that was the individual player cap at the time. But as the salary cap nearly doubled, the cap hits of the top ufa contracts, often yes because of backdiving risk structures, maintained that level. The effect was to allow what we used to derisively call the Tampa model, of 3 top ufas, being unsustainable, especially without at least a third of your every day roster playing for six figure contracts. But, by maintaining the Crosby ceiling even as the cap doubled, Crosby and Malkin can get some support and the much disparaged Tampa model from the start of the last cba is again very viable. As is a potential return to at least a better chance of maintaining an elite team longer.

It never really seemed to get noticed. But it seemed quite different team building environments between the start and end of the cba because of that. What will happen to these dynamics going forward. With short term no variance contracts, top ufa's will more likely get 5 yr $14 mil contracts or whatever the individual max will be. There is little room for the security/cost trade off. The disparity would more likely return. Is it being accounted for?

thinkwild is offline   Reply With Quote
Old
11-26-2012, 01:10 PM
  #40
barneyg
Registered User
 
Join Date: Apr 2007
Posts: 2,234
vCash: 500
Quote:
Originally Posted by thinkwild View Post
I did get that backwards didnt i. Im trying to remember the 2004 numbers, they were posted here. The mean salary was about $1.6 or $1.8 mil or something and the median about $1.1. At that time, the top ufa's were signing in a range of Heatley's $7.5 mil to Crosbys $8.7 mil as the top salary as that was the individual player cap at the time. But as the salary cap nearly doubled, the cap hits of the top ufa contracts, often yes because of backdiving risk structures, maintained that level. The effect was to allow what we used to derisively call the Tampa model, of 3 top ufas, being unsustainable, especially without at least a third of your every day roster playing for six figure contracts. But, by maintaining the Crosby ceiling even as the cap doubled, Crosby and Malkin can get some support and the much disparaged Tampa model from the start of the last cba is again very viable. As is a potential return to at least a better chance of maintaining an elite team longer.

It never really seemed to get noticed. But it seemed quite different team building environments between the start and end of the cba because of that. What will happen to these dynamics going forward. With short term no variance contracts, top ufa's will more likely get 5 yr $14 mil contracts or whatever the individual max will be. There is little room for the security/cost trade off. The disparity would more likely return. Is it being accounted for?
I'm not sure the difference between the top players and the rest really decreased overall -- the average salary is currently $2.4M to a $1.4M median. Crosby would still be set to make $12 million in 2013-14 without a rollback. The TB model might have worked longer than it did, had they had the hindsight to frontload the Lecavalier, Richards and Boyle deals a la Zetterberg or other 2005 CBA deals.

But I fully agree with the idea that team building will likely be different if 5-year limits are set into place.

barneyg is offline   Reply With Quote
Old
11-27-2012, 12:28 AM
  #41
Nabokov20
Karlsson for Chuck
 
Nabokov20's Avatar
 
Join Date: Sep 2009
Location: Ottawa
Country: Canada
Posts: 1,677
vCash: 1706
Ticket price increases seem to be somewhat align with GDP growth...although it would be better if that was the weighted average ticket price. Too lazy to check inflation.

Average players salaries are going up at nearly 9% compounded annually...again, it would be nice to have median player salaries because these figures tend to be skewed.

If you read between the lines, it basically suggests that star players have high bargaining power and have experienced the fruits of their labor...not necessarily at the expense of fans at the ticket booth, but rather the owners' margins.

fyi, im beyond tired at this point of the night and typing is becoming somewhat of a chore.

Nabokov20 is offline   Reply With Quote
Old
11-27-2012, 01:54 AM
  #42
Riptide
Moderator
 
Riptide's Avatar
 
Join Date: Dec 2011
Location: Yukon
Country: Canada
Posts: 8,775
vCash: 500
Quote:
Originally Posted by Fugu View Post
Quote:
Originally Posted by Riptide View Post
Quote:
Originally Posted by Fugu View Post
Back to revenue disparity. The NHL's proposal is worse. They still want their inflationary cap range system with linkage, which once again will spiral out of control for the bottom teams. The league IGNORES revenue disparity, with the only solution they seem interested in is lowering the players' take to the affordability level of the lowest team. That the wealthiest teams pocket their gains, unfairly and against any market principle that most businesses have to deal with, but that doesn't seem to bother you one bit. There is greed here, but you cannot see the worst case of it.
And other than putting the cap floor/ceiling on a % basis, what does the PA's proposal do differently that makes it better?
The PA never wanted this system in the first place. It's really not up to the PA to solve the league's economic problems and strategic decisions, but they probably realize that getting Bettman to accept the cap range system is fool's folly isn't going to happen easily (if at all).
So the PA's proposal is better... but you can't/won't explain how, other than to say it's not their issue to solve the leagues problems?

While I admit I haven't done the numbers on their latest/3rd proposal, the PA's first few proposals are not better for the NHL long term. And the latest one is 50%+some money, so long term it won't be much different than the NHL's proposal.

Yet when the league try's to solve the issue, the PA screams bloody murder. None of the PA's proposals addresses revenue disparity in any meaningful way. Every offer they've put forward is all about the PA getting as much money as possible and eliminating any risk should revenues not increase.

Riptide is offline   Reply With Quote
Old
11-27-2012, 02:10 AM
  #43
Fugu
Administrator
HFBoards
 
Fugu's Avatar
 
Join Date: Nov 2005
Location: Pac NW
Country:
Posts: 29,706
vCash: 500
Quote:
Originally Posted by Riptide View Post
So the PA's proposal is better... but you can't/won't explain how, other than to say it's not their issue to solve the leagues problems?

While I admit I haven't done the numbers on their latest/3rd proposal, the PA's first few proposals are not better for the NHL long term. And the latest one is 50%+some money, so long term it won't be much different than the NHL's proposal.

Yet when the league try's to solve the issue, the PA screams bloody murder. None of the PA's proposals addresses revenue disparity in any meaningful way. Every offer they've put forward is all about the PA getting as much money as possible and eliminating any risk should revenues not increase.


Well, using a term like "better" really depends on your perspective, doesn't it?

Does the NHL's offer yield more of the revenues for all owners? Sure.

Does it [fairly] address the revenue gap that coupled to the cap system has exacerbated the player cost for some of the teams? I'd say not really, because the revenue gap probably has grown over the past 7 years; but this time it forced spending upwards for all teams thanks to the cap range system.

So what is the NHL's solution? The same system, just with lowering the share a few percentage points. It's enough to nudge a few teams into a slightly better positions for now, but alone, it's not enough to help the truly hapless. The system will STILL have a floor that will drag everyone upwards with revenue.

That's the fallacy. Setting your costs as a fixed percentage of your revenues is basically rather asinine. If you have a banner year, you don't really get to just pocket the money, you get to look forward to a higher cap range. The system decouples business tenets that should not be decoupled. These are all variables (revenue, cost, profit) over which you should have control. If you grow revenue, why would you want to be shackled to raising your labor cost commensurately? Most businesses adjust, but you can't do that in capped leagues.

Fugu is online now   Reply With Quote
Old
11-27-2012, 06:48 PM
  #44
thinkwild
Veni Vidi Toga
 
thinkwild's Avatar
 
Join Date: Jul 2003
Location: Ottawa
Country: Canada
Posts: 8,279
vCash: 500
Quote:
Originally Posted by barneyg View Post
I'm not sure the difference between the top players and the rest really decreased overall -- the average salary is currently $2.4M to a $1.4M median. Crosby would still be set to make $12 million in 2013-14 without a rollback. The TB model might have worked longer than it did, had they had the hindsight to frontload the Lecavalier, Richards and Boyle deals a la Zetterberg or other 2005 CBA deals.
$2.4 and $1.4, hmmm, thanks, thats not quite what i was expecting, Perhaps i am mixing up actual salary dollars paid which perhaps are being distributed rather similarly to before, with cap hit dollars, which for top ufa's, seem to have remained static since the start of the cba. Perhaps if the cycle were to mature, and there was as many on the backend of the long contracts with high cap hits but low actual dollars it would change a bit.



Looking at all Edmontons young guns, i guess the contracting changes will affect how long they can keep that team together. If they are all kept artificially a lot cheaper than their stats would warrant for a few years, (i guess we might call that circumventing the cap), well if only Ottawa knew back then that they could sign Spezza, Heatley and still get Chara. Perhaps what Ott and TB didnt take enough advantage of was the backdiving contracts.

thinkwild is offline   Reply With Quote
Reply

Forum Jump


Bookmarks

Thread Tools

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off



All times are GMT -5. The time now is 04:28 PM.

monitoring_string = "e4251c93e2ba248d29da988d93bf5144"
Contact Us - HFBoards - Archive - Privacy Statement - Terms of Use - Advertise - Top - AdChoices

vBulletin Copyright ©2000 - 2014, Jelsoft Enterprises Ltd.
HFBoards.com is a property of CraveOnline Media, LLC, an Evolve Media, LLC company. ©2014 All Rights Reserved.