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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, NHL revenues, relocation and expansion.

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Old
09-23-2004, 03:42 PM
  #76
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Quote:
Originally Posted by habitual_hab
It is my understanding that a franchisor or franchisee cannot impose on the employees working for the franchisee anything that infringes on their ability to negotiate freely in the labour market UNLESS it that "anything" has been negotiated as part of a collective bargaining agreement.

Correct me if I'm wrong.
No, you are wrong. You gotta distinguish between what the franchisee can negotiate & what he is authorized to negotiate. Furthurmore, employers & franchisees "impose" their salary scale all the time on employees. If the employee does not like it, they are always free to go play ball with a different employer/franchisee (not with the same franchisor, of course) anytime they so choose.
If you dont like the terms of the franchise agreement , where you are been dictated to as to how to run your buisness, dont becaome a franchisee.

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09-23-2004, 03:46 PM
  #77
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Quote:
Originally Posted by Seachd
It doesn't matter who or who doesn't understand "status quo". I'll explain it for them now - nothing changes with the NHLPA's proposal. If you want to believe that means it's completely different than now, fine. But that's not how it is.
read my post bud. i was not commenting on the merits of the proposal, simply on the claim that it is status quo.

the end result may not change anything in your opinion, but the framework of the proposal by the NHLPA is simply not status quo to the current framework of the CBA.

whether the NHLPA's proposal is acceptable or addresses the needs of the owners isnt what i am talking about. secondly, the #'s themselves in the proposal can be negotiated. why wont the owners even negotiate those #'s ?

dr


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Old
09-23-2004, 03:47 PM
  #78
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Quote:
Originally Posted by habitual_hab
That's not very nice. I own my own business and I negotiate wages with my employees. And never, unlike NHL players, have my employees taken a wage cut.
I've taken a pay cut voluntarily, H_H, because I thought at the time that onwership of the company was worth my loyalty during a lean period. They rewarded that loyalty by doing everything imaginable to preserve my job, but, ultimately, that wasn't possible and I volunteered to be laid off a few months later, because I was in a better position to find a replacement job than many of my co-workers were.

That loyalty came about by being up front with the satff and respectful of their needs, and treating them as partners.

They recovered soon after the layoff, and I had already found another job at a better pay rate.

Ta,

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09-23-2004, 03:50 PM
  #79
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Quote:
Originally Posted by Sammy
No, you are wrong. You gotta distinguish between what the franchisee can negotiate & what he is authorized to negotiate. Furthurmore, employers & franchisees "impose" their salary scale all the time on employees. If the employee does not like it, they are always free to go play ball with a different employer/franchisee (not with the same franchisor, of course) anytime they so choose.
If you dont like the terms of the franchise agreement , where you are been dictated to as to how to run your buisness, dont becaome a franchisee.
So as a DQ franchisor, I can direct my DQ franchisees to write up contracts with their employees that caps their income during the entirety of their employment at my DQ franchisee's franchise?

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09-23-2004, 03:52 PM
  #80
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Originally Posted by DementedReality
you are right, BUT if the owners want thsi group of players and not a lower level group, then they need to negotiate from a position that these players will accept.

these players have said "as a group, we wont play in your league under a salary cap". the owners now must decide if they want these players or another level of player to play in their league.

it works both ways.

dr
That's cool, my point was that the NHLPA is using a false arguement by indicating that if the NHL had a salary cap it would somehow no longer be a free market which is not true. If there was no other professional leagues for the players to play in, then it would be true. I guess we will find out if the NHLPA does eventually agree to a Cap. I personally think the NHLPA executive is over-estimating the support they have amongst the players or perhaps this is nothing more than posturing to test the owners resolve.

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09-23-2004, 03:52 PM
  #81
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Quote:
Originally Posted by habitual_hab
Stipulating a given wage in the (NHL)franchise agreement reduces the level of competition in the labor market (basically, when every franchise offers the same wage, or offers a wage up to a certain level, the competition in the labor market is reduced because there is an artificial restriction on the wages). This is absolutely and without a doubt a violation of the Sherman Anti-trust Act.
And, as an anarcho-syndicalist H_H, I find it funny that you are arguing for the enforcement of a LAW.

The Sherman Anti-Trust act is stupid and redundant. It doesn't do anything that the Free Market can't take care of on its own.

Ta,

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09-23-2004, 03:56 PM
  #82
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Quote:
Originally Posted by habitual_hab
So as a DQ franchisor, I can direct my DQ franchisees to write up contracts with their employees that caps their income during the entirety of their employment at my DQ franchisee's franchise?
Yep. If thats what the franchise or employment agreement says& I assume they were entered into freely & voluntarily. And if the employee or franchisee doesnt like it, they can go elswhere. Theres your free market at work.
I get the impression you feel there is some sort of inherent legal obligation to an employer to keep on giving higher & higher wages to their employees.


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09-23-2004, 03:58 PM
  #83
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Originally Posted by joechip
And, as an anarcho-syndicalist H_H, I find it funny that you are arguing for the enforcement of a LAW.

The Sherman Anti-Trust act is stupid and redundant. It doesn't do anything that the Free Market can't take care of on its own.
Just arguing facts. Whether or not The Sherman Anti-Trust act is stupid and redundant is besides the point.

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09-23-2004, 04:11 PM
  #84
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Originally Posted by Seachd
All you have to do is read the link. I assume that's why you asked for it.

"I would respectfully suggest that any collective bargaining agreement that results in 75% of your revenues going to the players is a flawed collective bargaining agreement."
That does say anything about salaries. In fact the Levitt report clearly stated that it included things such as per diems, insurance, awards, travel costs, etc.

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09-23-2004, 04:13 PM
  #85
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Quote:
Originally Posted by Guy Caballero
I don't think revenue sharing would work in the NHL. In the NFL it works because they have revenue streams that are not related to gate receipts. The NHL doesn't have that. If I were the Leafs, I wouldn't want to give millions of dollars from my gate to the Anaheim Mighty Ducks so they could sign big-name free agents.

Each team in the NHL should be able to ice a competitive team on their own, without the help of others. A cap would enable this. If some teams get rich because of the lower operating costs, good for their shareholders. But those higher revenues shouldn't determine who has the best teams every year. Let baseball use that system. It's a crap sport anyway.
If they're trying to implement a cap based on league revenues, then for the health and future of the league, then they need to (in my opinion) come up with some sort form of solid revenue sharing. Why should an Ed Belfour or Matts Sundin accept 3 or 4 mill per knowing the Leafs Owners are now making 50 mill per off them instead of 20?? Or Bertuzzi & Jovo should accept the same knowing their owners are making 35 mill? What happens when the Ducks/Canes/Panthers of the NHL fold? Does the Cap go up accordingly? It should! Although with teams folding, it doesn't really present much of a solid image for a league struggling to find it's place in the US!!

Revenue sharing might also force the Penguins or whoever owners to go out and market their team properly ... I don't think Mario would appreciate the nasty looks he'll get from Ed Snyder when he sends a Penguins team that can't fill Philly's arena! On the other hand, if Philly sells out the Igloo, Mario may end up paying Snyder more then Snyder pays him!!! Simularly, if no team wnats to add Pens games to their TV sched., then Mario & co. is SOL in my revenue sharing scenario & maybe it's time to rethink whatever startegy the team has...

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Old
09-23-2004, 04:14 PM
  #86
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Quote:
Originally Posted by guitaraholic
which is apparently most of you as all I ever read on this board is how the owners are not to blame and it's all the fault of the big bad greedy players... blah blah blah. Anyway, you folks assert that a salary cap of some kind (I read many of your posts saying things like "players shouldn't make more than a million a year.." and crap like that) is a reasonable solution or even a fair option to 'solving' the current CBA issues, which it isn't. So, I have a simple challenge for you: Find any other profession in the United States (the NHL is, I believe, based in New York and is technically an American enterprise) where pay rates are artificially capped by a governing entity. Find even one. Find any profession where the governing body of that profession says a person CANNNOT make more than $xxx,xxx.xx amount per year. I want you guys to know just how unbelievably morally wrong it is for one person to dictate to another the amount of money they can make in a (erstwhile) free market economy. I'd particularly be amused by any Republicans who want to take up the position that the league has the right to intervene in a free marketplace and regulate it. Please, make my day.
Do you know what a free market is?

Pro sports, NHL hockey in this case is not a "free market". If there is no league created for hockey players to play in, then they don't get paid anything. The market in this case is the league, which was created by owners so hockey players could compete for the entertainment of the fans (and some owners to I assume), and to generate revenue and profile for the owners.

What gacks me out so much about your statement is that most posters have gone out of their way to point out that it was the owners initial folly of paying stupid amounts of $$$ that set this whole ball rolling. The players should be more than intelligent enough to know that it is in their best interst as a group to negotiate what they deem to be a "cap", as ultimately it would ensure they all can earn fabulous wages playing a game they are good at.

Players can not in good faith say they are willing to negotiate if they are saying no to tying salary to revenue. I will point out here that the Owners absolutely must open their books to satisfy any of the players questions about generated income.

Setting an intial point from which you will not negotiate is a demand.

Tieing paychecks to revenue is hardly rare, and ultimately makes the players more responsible for what they earn. If they don't compete hard, then fans don't come to the games and their incomes won't increase. Conversley, if the team is great to watch, the fans spend the money and revenue increases for the league and salaries can then increase. The TV deals get better and the league gets healthier.

Obviously the owners have to give up a fair amount in this deal as well, but at least there is a sensible amount of cost certainty. Owners can't just raise prices to pad their earnings... as any extra income generated will also be shared with the players.

All this will likely do is to keep 10% of the players from making the extreme amounts they are now making.

You are correct in that the players are now being asked (to some degree) to save the owners from themselves, but it's also in their best interest to do so. Having a heathy, working environment is sensible.

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09-23-2004, 04:17 PM
  #87
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Originally Posted by BlackRedGold
That does say anything about salaries. In fact the Levitt report clearly stated that it included things such as per diems, insurance, awards, travel costs, etc.
And honestly, how much do you think those other costs actually are?

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09-23-2004, 04:22 PM
  #88
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When the recently expired CBA was negotiated back in 1995, the players were opposed not only to a salary cap but also to a luxury tax. I wonder what they had against the luxury tax. It wouldn't have come out of their pockets. Now they realize it and propose a luxury tax. I hope the owners have become smart enough to see that a luxury tax isn't in their best interests. It doesn't work in MLB, and it wouldn't be good for the NHL.

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09-23-2004, 04:31 PM
  #89
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Quote:
Originally Posted by guitaraholic
which is apparently most of you as all I ever read on this board is how the owners are not to blame and it's all the fault of the big bad greedy players... blah blah blah. Anyway, you folks assert that a salary cap of some kind (I read many of your posts saying things like "players shouldn't make more than a million a year.." and crap like that) is a reasonable solution or even a fair option to 'solving' the current CBA issues, which it isn't. So, I have a simple challenge for you: Find any other profession in the United States (the NHL is, I believe, based in New York and is technically an American enterprise) where pay rates are artificially capped by a governing entity. Find even one. Find any profession where the governing body of that profession says a person CANNNOT make more than $xxx,xxx.xx amount per year. I want you guys to know just how unbelievably morally wrong it is for one person to dictate to another the amount of money they can make in a (erstwhile) free market economy. I'd particularly be amused by any Republicans who want to take up the position that the league has the right to intervene in a free marketplace and regulate it. Please, make my day.
If you were to join the military, you would have your pay governed by the gov't. There is no negotiation. For your rank and time in service, you get a specified amount. And the gov't determines wen you can be promoted.

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09-23-2004, 04:35 PM
  #90
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Quote:
Originally Posted by Corey
When the recently expired CBA was negotiated back in 1995, the players were opposed not only to a salary cap but also to a luxury tax. I wonder what they had against the luxury tax. It wouldn't have come out of their pockets. Now they realize it and propose a luxury tax. I hope the owners have become smart enough to see that a luxury tax isn't in their best interests. It doesn't work in MLB, and it wouldn't be good for the NHL.
The issue they had back then was that in their opinion the luxury tax was so harsh in their eyes that it 'amounted to' a salary cap.

Sure they mention a luxury tax now, but rest assured that any idea put forth by the NHL to have a luxury tax with a harsher bite to it would evoke similar rhetoric from them.

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Old
09-23-2004, 06:14 PM
  #91
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Quote:
Originally Posted by guitaraholic
So, I have a simple challenge for you: Find any other profession in the United States (the NHL is, I believe, based in New York and is technically an American enterprise) where pay rates are artificially capped by a governing entity.
In Canada, I believe we have capped the salaries Doctors can make. I think they even try to force new doctors to work in underpriveleged communites if they want to bill OHIP. Everyone in Canada gets healthcare, which is great. Except of course the rich people, who go to the States for private treatment with the best doctors. Well best paid anyway.

I dont know if I like using this example to demonstrate the results of a cap, as I know the arguments Im going to hear, but there it is.

I know and agree with you, but Im not sure trying to make comparisons between hockey and any other business is a worthwhile tack to take



Quote:
Originally Posted by habitual_hab
For example, the 1994-95 MLB players strike didn't end until a federal judge ruled that the baseball owners engaged in unfair labour practices and could not unilaterally impose a salary cap on players
Perhaps their thinking this time is that if they dont engage in ufair labour practices the courts will not only allow something they strike down every time, but legislate its implementation for them.


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Couldn't hack the 9 week course in Rigeau?
Its Rigaud

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Originally Posted by BlackRedGold
How can Goodenow deny something that has never been claimed by anyone other then yourself?
The players have said that everything in their framework proposal is negotiable. It is the framework that isnt.

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Old
09-23-2004, 06:17 PM
  #92
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Players would welcome free market

Quote:
Originally Posted by Guy Caballero
If the NHLPA truly wants a "free market" where the owners dictate how much players can make, players should accept that they can be fired for poor performance, just like any CEO.
It works both ways, a player would then also be able to resign from one employer (one week's notice, maybe even one day's notice) and move to play for another team.

In a free market sports environment it's usually the teams who want longer and guaranteed contracts for players in their prime or for youngsters with great promise (just look at the European soccer market, which is quite close to free market).

Like Tom Benjamin said it in another thread NHL needs NHLPA much more than the players do.

"If the players decide to chuck the union at some point during this dispute, NHL teams won't be able to do anything at all to suppress wages. They will not be able to hold an entry draft. No entry level salary system. No restricted free agents. No compensation for lost UFA's. They will not hold the rights to any player beyond the term of each contract. The NHL needs the union more than the players do. Tom"

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Old
09-23-2004, 06:20 PM
  #93
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Originally Posted by ceber
The expired CBA certainly wasn't a free market at all, so why do people keep bringing that term up. The NHLPA doesn't want a free market, do they? I think the NHLPA wants to put more controls on the marketplace that the owners do. A truly free marketplace would mean no guaranteed contracts, no guaranteed increases, and no restricted player movement. Everyone's a UFA, and everyone can be fired at any time for pretty much any reason.
The players would probably go for that. They have agents they trust. Its for competiveness balance and fairness to small market purposes that they accept the restrictions they do.

It certainly is a free market. Players have the right to negotiate their contracts to a value they agree on as their worth. Just like drug dealers. Perhaps the ultimate capitalist market. UFA's can do this with any team for any price with no outside restrictions on what that number can be.

RFAs have a made a great and vastly underappreciated significant concession for the sake of the competiveness of the league ( which has never been better) They have had the leverage to negotiate their free market value removed until they are 31. They start on a scale capped by the rookie cap, and rise to their market value over 13 years until they are 31. The closer they get to unrestricted free agency, the more leverage their hold out has. The closer they will get to their market value.

All arbitration decisions are basically measuring the speed with which they can approach their market value. Whether they get 40% or 60% of their market value as a 25 year old. If they get 100% awarded, all you lose is their righjts. And judging by how freely most fans are willing to throw 2 years of restricted free agency by lowering the free agent age to 29 or 26, why does this bother you.

The difference between the Yankees and the Rangers of course, is that the Yankees can buy 26 year olds, and all the Rangers can buy is 31 year olds. Although there are still those who believe that this strategy can be succesful if done right, it sure reamins to be proven, or even plausible.

Everyone under 31 is capped because they cant get market value. This is so fantastic because you can get 80mil of talent on your team, if you can get them all together under 26 when they dont have the ability to get their market value in salary negotiations. Which means drafting rules.

To then complain like NJ, because after a decade of success and 3 champs, and dynasty folloing their name, they are so hard done by because their core is expensive and they cant afford to keep them together, man gimme a break.

Bob Mackenzie, please write about rebuilding and how to properly build a champ and dispell the myth that Tampa Bay will never be able to compete with Colorado because Colorado has 3 $10mil players. How can Tampa afford to comepte against Colorado and all its $10mil players. Surely without the same money, there is no other way. Is there?

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Old
09-23-2004, 06:29 PM
  #94
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Quote:
Originally Posted by BobMckenzie

Ford, GM and Chrysler, for example, are all part of the same industry but they are intense competitors. But the competition is not so intense that they spend to put each other out of business. Most of the employees of the Big Three automakers are union employees of the United Auto Workers. If a production worker at Ford doesn't like his salary at Ford, he can't jump to Chrysler or GM because the salaries are the same there as at Ford.

Each time the UAW collective agreement expires, the union targets one of the companies for a strike or negotiation. When a new CBA is reached with that target, the same terms and conditions are levied across the board at the other two automakers. If that's not a cap, it's damn close to it
Bob the main difference between auto workers and the absolutely ridiculous analogy of Macdonalds franchises or their workers is that that these employees are replaceable tools to create the product.

The players ARE the product.

Management or software consulting companies certainly spend 75% of their revenues on their employees. Many of their consultants can get up to 95% of their per diems. When the players themselves are the product, 75% is more than fair. And as revenues rise, and owners fixed costs remain the same, 75% gets even more fair for owners.

Why dont the owners cap the amount they can spend on legal counsel? How about on their ad agencies? What about the CEOs of all the owners other companies or the owners salaries themselves?

The players are not Macdonalds employees. They are the industry. To remove their right to negotiate their market value completely is not only unfair, but illegal.

The trick is to find a way to provide different opportunities to success. So that Tampa Bay nad NYR could start on the same day, one buiklding cheaply, one buying every top UFA, and neither path is easier.

How about writing about Washington Rerdskins the Billion dollar franchise with revenues of a quarter billion paying 25% of that in salaries? That cap doesnt seem to be allowing to the players to properly capture a fair share of the revenue they are responsible for generating. Unlike Auto Workers who arent the product.

Bob its status quo in the sense that yes they dont want to allow the owners to take them off commision and put them on a salary, but its not status quo in the sense that its not addressing the owners stated specific concerns or finding ways to save money that owners aree losing because of CBA related causes and cant recover otherwise.

And Bob, what percentage of the losses would you say are CBA related?


And Bob, listening to Pierre say the Thrashers were sold for nothing. Come on Bob, you are great hockey mind and a good journalist. Look into it, im pretty sure you will find that that perception was an absolutley brilliant bit of deception. And then lets discuss why.

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09-23-2004, 07:16 PM
  #95
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Originally Posted by thinkwild
It certainly is a free market.
It certainly isn't. You mention it yourself when you talk about restricted free agents. Player movement is restricted; it's not a free market A free market also places no constraints on the maximum, or the minumum, a player can be paid to play. There's a league minumum, ergo the market is not free. Player movement is restricted, again not a free market.

Quote:
Originally Posted by thinkwild
The closer they get to unrestricted free agency, the more leverage their hold out has. The closer they will get to their market value.
I believe this is precisely what prevents them from reaching their market value. There's an artificial limit placed on supply. Lower supply, demand constant, price goes up. If you set all these players free, and allowed the GMs to negotiate with anyone, player salaries would go down. Some would go down so low it would be unfair. Only the top talent would continue to command large salaries. It's likely some teams would fail, and it's likely some teams would have an extreme advantage in the number of talented players they could sign. This is why a free market is bad. The average player salary would probably go down. The problem is competitive balance and financial health of every team in the league. A manipulated market is required to keep the average player salary up to ensure every player is fairly compensated, and it's required to ensure all teams have a fair shot at surviving and competing.

Doesn't have to be a cap, in my opinion, but there needs to be something in place.

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09-23-2004, 07:28 PM
  #96
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Originally Posted by thinkwild
The players ARE the product.
Wasn't there just a thread where many people said they would not mind going to games if the owners used replacement players? The game is the product. The players are replaceable. Many people would miss the star players, but new stars would emerge soon enough...

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09-23-2004, 08:09 PM
  #97
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Quote:
Originally Posted by thinkwild
The players ARE the product.
"MAKE WAY FOR THE BAD GUY...." - Tony Montana

The players are no more the product than Al Pacino is the product in 'Scarface'...

When people pay to see a movie, they pay to watch the movie - starring the actor... The movie is the product (i.e. the movie is what the ticket is for... the ticket is not to purchase Al Pacino)...

Likewise, when people pay to see a hockey game, they pay to watch the hockey game - starring the players... (i.e. the game is what the ticket is for... the ticket is not to purchase the hockey players)...

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09-23-2004, 08:12 PM
  #98
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Then why do you care so much about the UFAs other teams are signing. They are replaceable. Why do fans always demand their GM sign the best player whoever he is for whatever it takes.

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09-23-2004, 08:17 PM
  #99
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Quote:
Originally Posted by thinkwild
Then why do you care so much about the UFAs other teams are signing. They are replaceable. Why do fans always demand their GM sign the best player whoever he is for whatever it takes.
I don't demand that my GM sign the best player whoever he is for whatever he takes... But I imagine, because it potentially makes for a better movie (i.e. a better product)...

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09-23-2004, 08:19 PM
  #100
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Quote:
Originally Posted by ceber
It certainly isn't. You mention it yourself when you talk about restricted free agents. Player movement is restricted; it's not a free market A free market also places no constraints on the maximum, or the minumum, a player can be paid to play. There's a league minumum, ergo the market is not free. Player movement is restricted, again not a free market.
The owners start the year with their financial advisors, probably looking over their 5 year plan, the revenues they are going to get, the rate at which their young players are approaching their right to negotiate their market value, and formulate a plan on how to manage their assets to do it, and what budget to set. In this sense, it is a free market

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I believe this is precisely what prevents them from reaching their market value. There's an artificial limit placed on supply. Lower supply, demand constant, price goes up. If you set all these players free, and allowed the GMs to negotiate with anyone, player salaries would go down. Some would go down so low it would be unfair. Only the top talent would continue to command large salaries. It's likely some teams would fail, and it's likely some teams would have an extreme advantage in the number of talented players they could sign. This is why a free market is bad. The average player salary would probably go down.
Im not sure if its limiting supply, but setting the leverage their under 31 years old players have to negotiate their value in the marketplace.

Its possible that making everyone a UFA would lower some salaries. But Thats a drastic change, allowing Crosby and Heatley to negotiate their real value. I dont think the effects would be as pleasing as you seem to be suggesting. It takes away the advantage Ottawa used to become one of the model franchises.

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