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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.

Contraction a necessary evil for survival of NHL says economist

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Old
12-03-2012, 02:19 PM
  #326
sandysan
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Originally Posted by gordie View Post
If the New York Rangers and Los Angeles Kings want to win the cup they could outbid & outspend (compared to them) medium market Toronto and in fact crush all of Canada to win cup after cup.
sure they could. The question is would they ? In my opinion, no. For the leafs, I am not so sure. you bring a cup to toronto, thats about as close to sainthood as one can get.

Are you saying that the kings are a better market than the leafs or that AEG has deeper pockets ?

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12-03-2012, 02:29 PM
  #327
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Originally Posted by sandysan View Post
sure they could. The question is would they ? In my opinion, no. For the leafs, I am not so sure. you bring a cup to toronto, thats about as close to sainthood as one can get.

Are you saying that the kings are a better market than the leafs or that AEG has deeper pockets ?
If New York and Los Angeles were huge hockey markets (the're not even if those teams do win) then Toronto would be eating their dust. As a Pittsburgh Penguin fan I know the Pens average more TV households per local broadcast than either the Rangers or Kings. This tells you how much work the NHL needs to do in the U.S. to make serious inroads financially.

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12-03-2012, 03:03 PM
  #328
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Originally Posted by gordie View Post
If New York and Los Angeles were huge hockey markets (the're not even if those teams do win) then Toronto would be eating their dust. As a Pittsburgh Penguin fan I know the Pens average more TV households per local broadcast than either the Rangers or Kings. This tells you how much work the NHL needs to do in the U.S. to make serious inroads financially.
NY is but LA is not. They might be one day but those " potential" fans never seem to buy tickets and if california annexed mexico it still wouldn't be a better marker than toronto. You don't have to imagine what toronto would do if they were a huge market, they already are a huge market.

I'm not sure what you mean by how much inroads they need to make. I would think they should focus their efforts on the ones that are currently bordering on unsustainable.

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12-03-2012, 03:08 PM
  #329
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Originally Posted by gordie View Post
If New York and Los Angeles were huge hockey markets (the're not even if those teams do win) then Toronto would be eating their dust. As a Pittsburgh Penguin fan I know the Pens average more TV households per local broadcast than either the Rangers or Kings. This tells you how much work the NHL needs to do in the U.S. to make serious inroads financially.
And as I suspect you already know, the Rangers dont care if you watch. If you have the cablevision tier, you are already paying the rangers ( at least it was like this the last time I read about it).

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12-03-2012, 03:13 PM
  #330
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Originally Posted by txpd View Post
maybe i dont understand. but iirc before the salary cap nhl teams could and did spend freely. did the leafs win a cup? challenge for one? how many did the rangers get? how many did the flyers get?
Pre-2004, remember, players didn't go UFA until 31, barring strange contract circumstances. Forwards tend to be past their prime by that point, sometimes well past their prime. The ability of the Rangers, Leafs, and other large-market teams to buy their way to a championship was quite limited.

If you were to try a no-cap league today, when players hit UFA at 27, buying a title would have a better chance at success. Still not sure if the Leafs could manage it since they tend to screw up everything

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12-03-2012, 03:48 PM
  #331
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Originally Posted by optimus2861 View Post
Pre-2004, remember, players didn't go UFA until 31, barring strange contract circumstances. Forwards tend to be past their prime by that point, sometimes well past their prime. The ability of the Rangers, Leafs, and other large-market teams to buy their way to a championship was quite limited.

If you were to try a no-cap league today, when players hit UFA at 27, buying a title would have a better chance at success. Still not sure if the Leafs could manage it since they tend to screw up everything
The NHL gave up the one thing that really protected smaller markets and put an inflationary system in place that forced these very teetering markets to the brink by overspending. Brilliant.

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12-03-2012, 04:42 PM
  #332
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Originally Posted by txpd View Post
maybe i dont understand. but iirc before the salary cap nhl teams could and did spend freely. did the leafs win a cup?
After Ballard (who was cheap), and before the last lock out, the Leafs made the conference final 4 times over a decade and a half.

Better than most teams. They had large payrolls, because of heavy stock of veterans.

Those Leafs teams did not win, but they were very competitive.

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12-03-2012, 05:34 PM
  #333
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Originally Posted by Erik Estrada View Post
The PAs position is clear... Relocate failing franchises.
-If NHL insists staying put in money-losing markets, NHL pays for them.
-If NHL insists in pursuing it's Southern Strategy for an elusive big-money deal in 5, 10, 15 years, NHL pays for it.
There are not 30 north American markets that can or will operate under a 50m floor. There just aren't. There aren't even 20.
The NHL does plan on paying for its expansion plan by reducing the salaries of its employees who are extremely overpaid.
With a lower cap, many of these franchises can and will survive. Contraction makes no sense.

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12-03-2012, 05:37 PM
  #334
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Originally Posted by saskganesh View Post
After Ballard (who was cheap), and before the last lock out, the Leafs made the conference final 4 times over a decade and a half.

Better than most teams. They had large payrolls, because of heavy stock of veterans.

Those Leafs teams did not win, but they were very competitive.
So the answer is no?

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12-04-2012, 12:15 AM
  #335
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Originally Posted by CrazeeEddie View Post
There are not 30 north American markets that can or will operate under a 50m floor. There just aren't. There aren't even 20.
The NHL does plan on paying for its expansion plan by reducing the salaries of its employees who are extremely overpaid.
With a lower cap, many of these franchises can and will survive. Contraction makes no sense.
No they won't This is propaganda. There will always be franchises who lose money. Next we ask NY, Tor for more money too? Like I said, its the only the NHL where business acumen is applied sparingly.
Quote:
Originally Posted by CrazeeEddie View Post
So the answer is no?
What do you think? Look it up

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12-04-2012, 12:23 AM
  #336
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Originally Posted by Top 6 Spaling View Post
We tried that. They didn't win a cup for about 40 years. Now you're saying Toronto would somehow have an All-Star team. Name one big-ticket UFA who has chosen to go to the Leafs in the last decade when he could go anywhere.
frankly canadians teams don't get players because of what Dukla and sandy are talking about, the pressure.

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12-04-2012, 01:38 AM
  #337
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Quote:
Originally Posted by gordie View Post
If the New York Rangers and Los Angeles Kings want to win the cup they could outbid & outspend (compared to them) medium market Toronto and in fact crush all of Canada to win cup after cup.
The 4th biggest market (under Chicago) in the US and Canada is medium??

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12-04-2012, 02:46 AM
  #338
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Originally Posted by Dojji View Post
Pretty much the Maple Leafs are finding out that they actually have to think and they're not used to it.

24 teams have gone past at least one round of the playoffs during the cap era. If you were not one of them, that's not the cap's fault. If you could spend to the cap and are STILL not one if them, that's entirely your own fault.

I'll say it again -- the Canadian franchises don't have to compete for fans, so they don't tend to want to have to compete at all. American franchises know that they have to fight hard for what they get, so they tend to be more resilient from the top down. Canadian franchises have it much too easy to ever expect them to dominate the league again.
That is the sad truth. Canadian fans generaly have been too easy on their home organization amidst mediocrity.

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12-04-2012, 07:27 AM
  #339
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Originally Posted by Melrose Munch View Post
frankly canadians teams don't get players because of what Dukla and sandy are talking about, the pressure.
Vancouver, Edmonton, Calgary, and Winnipeg won't get top free agents without overpaying the overpayment because they're not in the eastern time zone. Vancouver can get guys that were born in BC and want to play close to home, Calgary has to give NMC's/NTC's to anyone and everyone who signs there, Edmonton will just never be a destination for top free agents unless they come up with more money than anyone else, and Winnipeg is in the same situation.

That leaves Montreal, Ottawa, and Toronto. Montreal is a different animal, since it seems to also have a language issue to deal with, in addition to the pressure. Ottawa has never really been a big spender. Toronto was a big spender, and they still spend a lot, but it looks like their talent evaluation has been poor. I've read a few times that Burke has been against, and doesn't like, giving out the long contracts either, which is fine, but standing on principle sometimes has its consequences.

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12-04-2012, 08:41 AM
  #340
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Originally Posted by kaneone View Post
How would contraction even work? Would the NHL have to buy the team from the owner of the contracting team?
As the players consider themselves partners in this league they would have to pay their share as well

Seriously though, the NHL is never going to make a silk purse out of the sows ear that is some US markets. The league will continue bleeding through these markets as long as those 3 or possibly 5 teams are locked into having the lowest ticket prices in the league in order to attract fans, and the players still believe they need to be paid like the players are paid in the leagues that have huge media contracts.


Last edited by therealkoho: 12-04-2012 at 09:05 AM.
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12-04-2012, 10:01 AM
  #341
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Originally Posted by therealkoho View Post
As the players consider themselves partners in this league they would have to pay their share as well

Seriously though, the NHL is never going to make a silk purse out of the sows ear that is some US markets. The league will continue bleeding through these markets as long as those 3 or possibly 5 teams are locked into having the lowest ticket prices in the league in order to attract fans, and the players still believe they need to be paid like the players are paid in the leagues that have huge media contracts.

Yeah the players can just go into their accounts where they put all of that expansion fee money. I'm sure with a reasonable return they would not have a problem paying back the owners of the contracted teams.

0h wait............

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12-04-2012, 10:59 AM
  #342
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any idea what that smilie means

no

didn't think so


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12-04-2012, 11:16 AM
  #343
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Originally Posted by therealkoho View Post
As the players consider themselves partners in this league they would have to pay their share as well

Seriously though, the NHL is never going to make a silk purse out of the sows ear that is some US markets. The league will continue bleeding through these markets as long as those 3 or possibly 5 teams are locked into having the lowest ticket prices in the league in order to attract fans, and the players still believe they need to be paid like the players are paid in the leagues that have huge media contracts.
Then in 4,5, or 6 years when this CBA expires we can go through all this again. Good times!

A sure way to fix this is if the feds changed tax laws so that these guys couldn't right off losses caused by their hobby businesses. The league would kill 5 or 6 teams in a heartbeat.

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12-04-2012, 11:17 AM
  #344
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Originally Posted by Pyrophorus View Post
The 4th biggest market (under Chicago) in the US and Canada is medium??
Philadelphia, Dallas, San Francisco, Atlanta, Boston, Washington DC, Houston are all about Toronto's size and that makes Toronto a large city if located in U.S. but certainly well below New York, Los Angeles and even Chicago. Some fans especially in Canada don't realize that despite being Original 6 cities New York and Chicago have plenty of work to do to catch NFL,MLB and NBA in those markets and the NHL financial league benefits that go along with it.

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12-05-2012, 11:03 AM
  #345
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Originally Posted by gordie View Post
Philadelphia, Dallas, San Francisco, Atlanta, Boston, Washington DC, Houston are all about Toronto's size and that makes Toronto a large city if located in U.S. but certainly well below New York, Los Angeles and even Chicago. Some fans especially in Canada don't realize that despite being Original 6 cities New York and Chicago have plenty of work to do to catch NFL,MLB and NBA in those markets and the NHL financial league benefits that go along with it.
Right. The only US city right now that's really "tapped out" in terms of hockey growth potential is probably Boston, they'll always fill the barn unless they have a specific major turn-off with ownership or management -- Boston fans are passionate, but have a vindictive streak -- but certainly any of the MAJOR city teams in America (which despite its own protestations, Boston IS NOT) have plenty of room to expand their penetration into their own cities.

Realistically the only NHL franchises that are making as money as they could make are probably some of the Canadian ones -- and even not really all of those.

That big media deal they're chasing would go a looooooong way to getting there. Most Americans decide to go to games based on what they like to watch on TV, not the other way around. More eyeballs on the screen means more butts in seats.

Unfortunately that depends HEAVILY on the southern expansion not being a mixed bag of niche teams. The league has to make sure those teams succeed by all means, and if that means that the league needs to wage a campaign to convince non-hockey fans that hockey is fun to watch, that's exactly what they need to do. And giving up on southern markets is exactly the wrong way to grow. A retreat to the north would be all about short term gain, and would hurt the league in the long run


Last edited by Dojji*: 12-05-2012 at 11:09 AM.
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12-05-2012, 11:39 AM
  #346
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Originally Posted by CrazeeEddie View Post
There are not 30 north American markets that can or will operate under a 50m floor. There just aren't. There aren't even 20.
The NHL does plan on paying for its expansion plan by reducing the salaries of its employees who are extremely overpaid.
With a lower cap, many of these franchises can and will survive. Contraction makes no sense.
I agree, I fail to see the argument that franchises must fold in order to have superstars be paid more money.

The NHL is a niche sport in the U.S. There are not enough markets in Canada to support the number of professional players in the market place. The players are THE major expense for teams. They will have to take less money.

That being said the NHL needs to make sure that their revenue sharing plan is sound and fills the gaps for the lower revenue teams.

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Old
12-08-2012, 12:38 PM
  #347
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Maintaining my opinion that:

2 Teams Need To Fold
2 Teams Need To Relocate



While many here can argue we have several teams that are doing poorly, I believe only 4 are in extreme need to be lifted.


Obviously I won't name names.


I do think it's rather impossible for there not to be any change when you're looking at two seasons lost in the span of 8 years. And this is the NHL we're talking about, the 4th guy in sports in North America.

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12-09-2012, 11:10 PM
  #348
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Originally Posted by WingsFan95 View Post
Maintaining my opinion that:

2 Teams Need To Fold
2 Teams Need To Relocate



While many here can argue we have several teams that are doing poorly, I believe only 4 are in extreme need to be lifted.


Obviously I won't name names.


I do think it's rather impossible for there not to be any change when you're looking at two seasons lost in the span of 8 years. And this is the NHL we're talking about, the 4th guy in sports in North America.
I'm only seeing 2 franchises that are in any real longterm trouble. Those two being Phoenix and possibly Columbus. There's a few cracks in other places, but not nearly enough to warrant a nuclear option like relocation or contraction.

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12-09-2012, 11:17 PM
  #349
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I'm only seeing 2 franchises that are in any real longterm trouble. Those two being Phoenix and possibly Columbus. There's a few cracks in other places, but not nearly enough to warrant a nuclear option like relocation or contraction.
Anyone who has ever been to Columbus has wondered for years why they have a pro sports franchise let alone hockey. It's a head scratcher kinda like the Jaguars in Jacksonville. It's too bad they can't get the ownership settled in Phoenix though. It's a huge market and long term success in Phoenix would be great for the NHL. Either way I am not a fan of contraction.

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12-10-2012, 12:17 AM
  #350
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Anyone who has ever been to Columbus has wondered for years why they have a pro sports franchise let alone hockey. It's a head scratcher kinda like the Jaguars in Jacksonville. It's too bad they can't get the ownership settled in Phoenix though. It's a huge market and long term success in Phoenix would be great for the NHL. Either way I am not a fan of contraction.
Gee, thanks.

Columbus was awarded a team for the following reasons:
1) A long-running history of hockey

2) An extremely passionate and dedicated following for the local ECHL team (Columbus Chill) when the NHL was considering expansion. International acclaim for marketing and promotions, the longest sellout streak in minor league history despite playing at a dump, and the CBC branding it "the most successful minor league franchise in history". This was all despite a noted lack of actual on-ice success.

3) Ownership that was committed to permanently cementing a claim, regardless of the cost. John H. McConnell, the ultimate self-made man, basically handled the franchise like a source of civic pride rather than a business.

How committed, you may ask? Nationwide Arena was built without a single public dollar being used. No other NHL venue can make the same claim, and I can't think of another in North American pro sports off the top of my head.

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