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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.

My thoughts on the NHL's situation

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Old
09-03-2004, 10:12 PM
  #1
DownFromNJ
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My thoughts on the NHL's situation

Theres been a lot of talk lately about Hockey not being a major sport in the United States. Gary Bettman gets a lot of crap for bringing hockey to places it isn't supposed to belong.

I disagree. Hockey is thoroughly entrenched as the 4th sport in the United States, behind Football (1), Baseball (2), and Basketball (3). These three sports have a few key advantages over hockey:

1) Grass roots players. Theres a lot more kids playing the above three sports than hockey. Part of it is rink availability, part of it is culture.

2) The Media is on their side. Hockey is not a big draw, because it is not very TV friendly. Therefore, the media tends to ignore hockey when it can.

3) The big teams win. This is huge.

I'd like to focus on #3 first. Who can you blame for hockey's bad TV contract? I blame the Rangers. Well, not just the Rangers, but our big market teams in general. The NHL cannot afford to have LA, Chicago, and New York out of the playoffs year after year. The New York Media is the greatest equalizer in sports reporting. If you want to create a superstar in the NHL today, he's going to have to come out of New York.

Now, about the grassroots movement in hockey. Gary Bettman has done an excellent job in expanding hockey to the outer limits of the United States. Ice Rinks and kids hockey teams are darting up in Texas, Georgia, Florida, Tennessee, California, Arizona, and plenty of other places. By placing pro teams in these markets, hockey's seeds have been planted. It worked in New Jersey, I know that first hand (it doesn't help that we have three teams eating up our market, but it seems like a new ice rink opens every year in Northern Jersey).

The Rangers can win over the media and we win over the people. In short, Gary Bettman's long term plan will work, and in the short term we will improve only if the big market teams can improve.

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09-03-2004, 10:40 PM
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I never understood the need to "expand the market". The only thing it has done is taking teams out of places where they have huge audiences and putting them in places where no one cares.

The NHL doesn't need to expand their markets, they need to contract it. Bring the hockey back to cities that care.

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09-04-2004, 09:06 AM
  #3
hockeytown9321
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Quote:
Originally Posted by DownFromNJ
Theres been a lot of talk lately about Hockey not being a major sport in the United States. Gary Bettman gets a lot of crap for bringing hockey to places it isn't supposed to belong.

I disagree. Hockey is thoroughly entrenched as the 4th sport in the United States, behind Football (1), Baseball (2), and Basketball (3). These three sports have a few key advantages over hockey:

1) Grass roots players. Theres a lot more kids playing the above three sports than hockey. Part of it is rink availability, part of it is culture.

2) The Media is on their side. Hockey is not a big draw, because it is not very TV friendly. Therefore, the media tends to ignore hockey when it can.

3) The big teams win. This is huge.

I'd like to focus on #3 first. Who can you blame for hockey's bad TV contract? I blame the Rangers. Well, not just the Rangers, but our big market teams in general. The NHL cannot afford to have LA, Chicago, and New York out of the playoffs year after year. The New York Media is the greatest equalizer in sports reporting. If you want to create a superstar in the NHL today, he's going to have to come out of New York.

Now, about the grassroots movement in hockey. Gary Bettman has done an excellent job in expanding hockey to the outer limits of the United States. Ice Rinks and kids hockey teams are darting up in Texas, Georgia, Florida, Tennessee, California, Arizona, and plenty of other places. By placing pro teams in these markets, hockey's seeds have been planted. It worked in New Jersey, I know that first hand (it doesn't help that we have three teams eating up our market, but it seems like a new ice rink opens every year in Northern Jersey).

The Rangers can win over the media and we win over the people. In short, Gary Bettman's long term plan will work, and in the short term we will improve only if the big market teams can improve.
I agree that they need marquee teams to be successful. This is why a salary cap is bad for hockey. It creates total parity.

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09-04-2004, 09:34 AM
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The concept of 30 equal teams isnt Utopia, its Hell. There is a lot of second guessing over what they have achieved in the NFL. Many are rethinking their views on parity.

Its funny that what is being suggested that Bettmans palns for cost certainty will help the big markets win more, and that the lack of their winning is part of the problem. I sometimes fear you could be right. While at the same time, many are complaining that this CBA is unfair to small markets as they cant win. I think what DownFromNJ is suggesting is correct. The large markets are disadvantaged because they are pressured to spend and buy marquee names rather than build. Maybe Wirtz is on the right track. His cheapness will soon be rewarded.


As for all the talk of hockey being outdrawn by tiddlywinkls or what ever, I think you have to note these are talking about nationally. Within the markets themselves, they are still doing quite well.

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09-04-2004, 10:04 AM
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Quote:
Originally Posted by H/H
I never understood the need to "expand the market". The only thing it has done is taking teams out of places where they have huge audiences and putting them in places where no one cares.

The NHL doesn't need to expand their markets, they need to contract it. Bring the hockey back to cities that care.

"Expand the market" has nothing to do with taking teams out of places where they have huge audiences. Adding new teams (expanding) puts teams in other markets.

What does take teams out of places where they have huge audience is rising player salaries and the fans in that place being unable to support the rising salaries. If you take 1 team out of the NHL or 10 teams out of the NHL, places like Winnipeg, Quebec, or Hartford are not going to get teams back as long as the player salaries are as high as they are now.

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09-04-2004, 10:36 AM
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Originally Posted by DownFromNJ
The Rangers can win over the media and we win over the people. In short, Gary Bettman's long term plan will work, and in the short term we will improve only if the big market teams can improve.
I think this is the biggest irony of all. The best thing for the business of the NHL would be successful teams in the big US markets. That's what they need to improve the TV deal and media footprint. The fact that teams like Ottawa, Tampa and Calgary can be successful under this CBA is very bad for business.

The best thing for the business of hockey is to have big market dynasties with the fans convinced the league is fair. Kind of like the NBA.

Tom

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09-04-2004, 10:54 AM
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Originally Posted by Tom_Benjamin
The fact that teams like Ottawa, Tampa and Calgary can be successful under this CBA is very bad for business.
this is the irony of th debate here at HF. The NHL wants to change the CBA so that the big markets have a better chance against the small markets, yet the fans think its the other way around.

Under this CBA, OTT can keep all its players if it chooses to. If it does keep all its players, it will continue to be a dominant team. Under a capped CBA, OTT will not be able to keep all its players and will not continue to be a dominant team.

How does this help a team like NYR ? Well clearly they are unable to catch up to OTT by spending their way to success, so now they can catch up by forcing OTT down to the pack AND NYR gets to pocket an extra 40m or so per season.

No wonder the NHL is going with the scorched earth policy, there is so much to win and the scenario is like bizarro world, where they have convinced the masses that the results will be turn out to be good for the fans of small markets, when in fact its the exact opposite.

DR

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09-04-2004, 11:08 AM
  #8
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Expanding the market is incredibly important for the NHL's future. In a decade, we'll be seeing drafted players coming out of Texas, New Jersey, the D.C. area, etc. In two decades, we'll be seeing players come out of Atlanta and Tennessee.

I don't think the current CBA gives an advantage to small market teams. I think it keeps the playing field even, with an edge to richer teams. There is a reason Detroit and Colorado win consistantly, and New York loses. Detroit and Colorado are managed well, and New York has Glen Sathar. If the Rangers managed their assets well, they should be as unstoppable as Detroit.

Hockey isn't baseball. You can't buy a victory. Money helps retain players that you wisely developed and drafted. That is the problem that Tampa, Ottawa, Calgary, and other talented young teams are running in to. Under a perfect system, those new UFAs would go to New York, Los Angeles, Boston, Toronto, Chicago, etc. However, without sufficient young player bases, these teams end up failing. Either that, or the big market teams refuse to spend, putting themselves at a similar level to the small market teams (example: Boston, Chicago).

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09-04-2004, 11:15 AM
  #9
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Quote:
Originally Posted by DownFromNJ
Money helps retain players that you wisely developed and drafted. That is the problem that Tampa, Ottawa, Calgary, and other talented young teams are running in to. .
as an anti cap person, this is the one area that I can agree with. however, a cap isnt the solution to the problem. if there is only so much money from the team to pay those players, then they need to make smarter decisions.

like not giving Toni Lydman a contract for over 2m per season when he had no leverage.

dr

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09-04-2004, 11:47 AM
  #10
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Originally Posted by DementedReality
as an anti cap person, this is the one area that I can agree with. however, a cap isnt the solution to the problem. if there is only so much money from the team to pay those players, then they need to make smarter decisions.

like not giving Toni Lydman a contract for over 2m per season when he had no leverage.

dr
No leverage. Because he is not 31 years old and about to become a free agent, right?

The team offered him a contract over $2M per season to avoid arbitration where they probably feel that he would be awarded even more, and/or need to go through the same thing the next year. Or are you saying that they should have taken their chances in arbitration, and walk away if the rulling was anywhere near this $2M per season level, thus starting the dismantling of the Calgary stanley cup contending team how many seasons after they were in the finals? Oh, wait. If they simply make a wise decision drafting, they would have a D man just as good as him waiting in the wings, since good d-men are so easy to come by...

Seems to me he had a lot of leverage.


Last edited by djhn579: 09-04-2004 at 12:32 PM.
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09-04-2004, 11:52 AM
  #11
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Originally Posted by DownFromNJ
Expanding the market is incredibly important for the NHL's future.
No. It is incredibly important for the business of the NHL. If the league remains small time in the US, it remains small time in the US. Big deal. The owners can make less and the players can make less. It is not in the fan's best interest for the owners and players to make more.

Quote:
I don't think the current CBA gives an advantage to small market teams. I think it keeps the playing field even, with an edge to richer teams.
Note the bait and switch here. We are not talking small market versus large market any more. We are suddenly talking rich versus poor. Colorado and Detroit and New Jersey may be rich but they are not big market. They are not big market enough to attract US TV or a US media footprint.

These teams earned their success. Calgary is every bit as good iof a market as Denver. If they keep winning they will be rich too. That is an advantage, but it is good that this advantage exists. It is a reward for doing well. It encourages teams to try to do well.

The NHL wants all teams to do well. They want all teams to have a chance to win with the big markets - not the rich teams - having a big enough advantage that there is always at least one giant TV market in the Stanley Cup Final. They want guaranteed profits for the incompetent, and larger TV revenues and a bigger footprint that will benefit everybody.

That's best for the business of hockey. The remarkable thing is they have managed to convince most fans that what's good for the business of hockey is also good for the game and the fan.

Tom

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09-04-2004, 12:22 PM
  #12
DownFromNJ
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No. It is incredibly important for the business of the NHL. If the league remains small time in the US, it remains small time in the US. Big deal. The owners can make less and the players can make less. It is not in the fan's best interest for the owners and players to make more.
Canada cannot support the NHL in it's present state. Sorry, I hate to break it to you. The United States is the richest country in the world, and has 9 times the population of Canada. If the NHL could tap into the United States like the other sports leagues, it would become huge.

It is in the fan's interest. I want to see North American players coming out of places besides Canada, Minnesota, Michigan, and New England. Remember when we opened up Europe to the NHL? Think of all the talent we got out of Europe. The same can happen in America.

People say that expansion thinned the talent base. I disagree. There are so many talented hockey players out there. More teams means more talented players from Europe can come over and get better.

In the United States, High School teams are training star football, basketball, and baseball players. Imagine those resources put into hockey. Its more than anything Canada can offer.



Quote:
Note the bait and switch here. We are not talking small market versus large market any more. We are suddenly talking rich versus poor. Colorado and Detroit and New Jersey may be rich but they are not big market. They are not big market enough to attract US TV or a US media footprint.
I agree. However, theres nothing on the ice that puts a team like Detroit over a team like the Rangers. They have similar bankrolls, they play by the same rules. Theres no excuse for the big market teams not to succeed.



Quote:
These teams earned their success. Calgary is every bit as good iof a market as Denver. If they keep winning they will be rich too. That is an advantage, but it is good that this advantage exists. It is a reward for doing well. It encourages teams to try to do well.
A Canadian market will never be as rich as Colorado, Detroit, New York, Philly, etc. America is simply richer. A Canadian team needs to sell something along the lines of 20% more tickets to raise the money of an American team. American TV networks have more money, as do American consumers. I'm not anti-Canadian (I'm rooting for Canada at the world cup. I have two team Canada jersies), but its just fact.


Quote:
That's best for the business of hockey. The remarkable thing is they have managed to convince most fans that what's good for the business of hockey is also good for the game and the fan.
Hockey is a business. In fact, its a multi-billion dollar business. Get used to it. Money makes the world go round.

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09-04-2004, 12:49 PM
  #13
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Originally Posted by DownFromNJ
Canada cannot support the NHL in it's present state.
I don't care. So the NHL goes back to being what it was in the 1980's. Fine by me.

Quote:
It is in the fan's interest. I want to see North American players coming out of places besides Canada, Minnesota, Michigan, and New England. Remember when we opened up Europe to the NHL? Think of all the talent we got out of Europe. The same can happen in America.
I could care less. There is lots of talent.

Quote:
In the United States, High School teams are training star football, basketball, and baseball players. Imagine those resources put into hockey. Its more than anything Canada can offer.
So? All it would mean is more expensive hockey. It isn't like Canadians will stop watching or going to the games if the league stays Mickey Mouse in the United States. I see no downside. Hockey survives in Europe. It would survive in Canada too. I don't care whether it does well in the United States or not. Why should I?

Quote:
A Canadian market will never be as rich as Colorado, Detroit, New York, Philly, etc. America is simply richer.
A Canadian market that is icing a winner will be richer by far than an American team that ices a loser. That's all that matters.

Quote:
Hockey is a business. In fact, its a multi-billion dollar business. Get used to it. Money makes the world go round.
It makes the world go around for the owners and players. It does not make the world go around for the fans.

Tom

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09-04-2004, 12:57 PM
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A Canadian market that is icing a winner will be richer by far than an American team that ices a loser. That's all that matters.
No, it wouldn't.

California and New York are each richer than all of Canada. New York City is 1/3 the population of Canada. California has 14 million more people than Canada. Canadian teams cannot make anywhere near the potential profit that the Rangers, Kings, Blackhawks, etc can make. Hell, New Jersey is potentially more profitable than any Canadian market.

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09-04-2004, 01:44 PM
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Originally Posted by DownFromNJ
Hell, New Jersey is potentially more profitable than any Canadian market.
Interesting claim.

Last year New Jersey was the defending Stanley Cup champion and has a lesser attendance than *ANY* Canadian franchise

http://sports.espn.go.com/nhl/attendance?year=2004

How is your claim consistent with this fact?

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09-04-2004, 02:52 PM
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Nice story.

New Jersey also made more money than *half* the Canadian Franchises.

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09-04-2004, 03:11 PM
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Originally Posted by DownFromNJ

Hell, New Jersey is potentially more profitable than any Canadian market.
Quote:
Originally Posted by CH
Interesting claim.

Last year New Jersey was the defending Stanley Cup champion and has a lesser attendance than *ANY* Canadian franchise

http://sports.espn.go.com/nhl/attendance?year=2004

How is your claim consistent with this fact?
Quote:
Originally Posted by DownFromNJ

Nice story.

New Jersey also made more money than *half* the Canadian Franchises.
I have no idea if your final fact is true or not (although it might be). Do you have a source for it?

Even if it is true, New Jersey was the defending Stanley cup champions last year. Their financial position was about as good as it can possibly be, since there isnt any room to improve on the ice. If New Jersey is a legit NHL market they better have made huge money last year.

However, you claim that they failed to make as much money as some of the Canadian NHL franchises (I think that is what your claim that they made more money than *half* the Canadian franchises means).

How is New Jersey potentially more profitable than any Canadian NHL franchise when when even in a year when they are the defending cup champs they fail to make as much money as several Canadian teams?

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09-04-2004, 03:13 PM
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Originally Posted by djhn579
No leverage. Because he is not 31 years old and about to become a free agent, right?

The team offered him a contract over $2M per season to avoid arbitration where they probably feel that he would be awarded even more, and/or need to go through the same thing the next year. Or are you saying that they should have taken their chances in arbitration, and walk away if the rulling was anywhere near this $2M per season level, thus starting the dismantling of the Calgary stanley cup contending team how many seasons after they were in the finals? Oh, wait. If they simply make a wise decision drafting, they would have a D man just as good as him waiting in the wings, since good d-men are so easy to come by...

Seems to me he had a lot of leverage.
Lydman wouldnt have arbitration rights 2 years ago when he signed the contract. also, what basis would have Lydman been able to command that much $ from an arbitrator ? he has done nothing outstanding in his career, so i cant imagine the Flames had much risk of a large arbitration award, even if he was eleginbe.

dr

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09-04-2004, 03:27 PM
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Originally Posted by DementedReality
Lydman wouldnt have arbitration rights 2 years ago when he signed the contract. also, what basis would have Lydman been able to command that much $ from an arbitrator ? he has done nothing outstanding in his career, so i cant imagine the Flames had much risk of a large arbitration award, even if he was eleginbe.

dr
August 11, 2003

"I am happy to have worked it out and avoid arbitration," said Lydman, who turns 26 next month. "It was important to me to have a longer term deal rather than the one year that would have resulted from arbitration. I wanted to remain in Calgary."

http://www.all-sports.com/cgi-bin/sh...story_id=43621

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09-04-2004, 03:44 PM
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The original topic for this thread is a lot of the backing to my idea for a CBA resolution. By seperating the big markets from the small markets, you might be able to at least draw more attention to the big markets side of the league, and thus create more overall interest in the league.

Face the facts, it would draw more attention from the media if you had Detroit versus New York in the finals than if you had Phoenix versus Tampa Bay. The ratings would be larger, and the overall exposure would be greater.

That's why I say you take all the big market teams, throw them in a division/conference/league, whatever you want to call it. You have them compete amongst each other without a cap largely until the Cup final where they would face a small market team. Now I know that is where the logic is flawed, because then you don't have two large markets in the finals. As it is now, how many of the big markets have gone to the finals the past 10 years? This would insure that at least 10 out of 10 Finals have one of the bigger market teams.

On the flip side, you have the small market teams who are able to survive comparitively with a cap in place at very least allowing all the teams the chance to be competitive in their group of small market teams.

It's similar to the Tier system, and it's based on the economics and popularity of the league.

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09-04-2004, 03:46 PM
  #21
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Originally Posted by DownFromNJ

I don't think the current CBA gives an advantage to small market teams. I think it keeps the playing field even, with an edge to richer teams. There is a reason Detroit and Colorado win consistantly, and New York loses. Detroit and Colorado are managed well, and New York has Glen Sathar. If the Rangers managed their assets well, they should be as unstoppable as Detroit.
Thank you. I wish everyone would realize this.

If you have good management, you'll make good moves and have a good team, regardless of payroll. Some teams need to look at themselves in the mirror and take responsibility for making bad moves, instead of blaming Detroit or Colorado.

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09-04-2004, 03:51 PM
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Quote:
Originally Posted by djhn579
August 11, 2003

"I am happy to have worked it out and avoid arbitration," said Lydman, who turns 26 next month. "It was important to me to have a longer term deal rather than the one year that would have resulted from arbitration. I wanted to remain in Calgary."

http://www.all-sports.com/cgi-bin/sh...story_id=43621

ok ... he was elegible. .... still no reason to give him a contract for that amount AND at the same time cry poverty.

what had he done to be worth over 2m per season ?

dr

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09-04-2004, 03:53 PM
  #23
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Originally Posted by GoCoyotes
The original topic for this thread is a lot of the backing to my idea for a CBA resolution. By seperating the big markets from the small markets, you might be able to at least draw more attention to the big markets side of the league, and thus create more overall interest in the league.

Face the facts, it would draw more attention from the media if you had Detroit versus New York in the finals than if you had Phoenix versus Tampa Bay. The ratings would be larger, and the overall exposure would be greater.

That's why I say you take all the big market teams, throw them in a division/conference/league, whatever you want to call it. You have them compete amongst each other without a cap largely until the Cup final where they would face a small market team. Now I know that is where the logic is flawed, because then you don't have two large markets in the finals. As it is now, how many of the big markets have gone to the finals the past 10 years? This would insure that at least 10 out of 10 Finals have one of the bigger market teams.

On the flip side, you have the small market teams who are able to survive comparitively with a cap in place at very least allowing all the teams the chance to be competitive in their group of small market teams.

It's similar to the Tier system, and it's based on the economics and popularity of the league.

Its not really that far fetched. There's alot of smaller Division 1 schools with no chance of winning a national title, but they're still out there. And the competitive imbalance in college football is much greater than in hockey.

Maybe even something like how the Superbowl was created. The AFL and NFL had seperate championships, the Super Bowl was more or less an exhibition. And beleive it or not, after a few years, the AFL was seen as equals. You could have a Stanley Cup series as the SuperBowl between the two leagues.

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09-04-2004, 04:05 PM
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Originally Posted by DementedReality
ok ... he was elegible. .... still no reason to give him a contract for that amount AND at the same time cry poverty.

what had he done to be worth over 2m per season ?

dr
August 11, 2003

CALGARY, Alberta (Ticker) - The Calgary Flames on Monday re-signed Toni Lydman, who led their defensemen in scoring last season, to a multi-year contract.

"Toni has a big offensive side to his game and makes our team better," Flames general manager and coach Darryl Sutter said. "He will play in our group of top four defensemen that I consider to be the best young defense corps in hockey."

http://www.all-sports.com/cgi-bin/sh...story_id=43621

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09-04-2004, 04:07 PM
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Originally Posted by djhn579
August 11, 2003

CALGARY, Alberta (Ticker) - The Calgary Flames on Monday re-signed Toni Lydman, who led their defensemen in scoring last season, to a multi-year contract.

"Toni has a big offensive side to his game and makes our team better," Flames general manager and coach Darryl Sutter said. "He will play in our group of top four defensemen that I consider to be the best young defense corps in hockey."

http://www.all-sports.com/cgi-bin/sh...story_id=43621
What would you expect Sutter to say?

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