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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.

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Old
02-06-2005, 04:40 PM
  #1
WHARF1940
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two questions

1. as far as the parity in the league....is it possible that we already have too much? Haven't the last few finals that involved small market, non-traditional clubs gotten absolutely horrible ratings? I agree that the finances need to be spread around to help certain teams, But don't we want the Detroits and Montreals and Colorados in the later rounds of the playoffs? Shouldn't they be able to put together big clubs but help out others by doing so through a stiff tax? We always need that cinderella team, sure, and that team will always be there when one small market club spends their tax money wisely, But c'mon, if it wasn't for the fact that one of the teams in the final this year was canadian, NOONE would have watched it. The big clubs need to be there.

2. What is with the insistince of linkage? A cap, Ok. I think it is too radical a change all at once, and for the reason stated above, I'd prefer trying a VERY punitive tax at first, but it could work. Not one tied to revenues, however. Based loosely on revenues, sure, but strict to the point of "if we pay you too much, you have to pay us back from an escrow account" is completely insane. If they need that much certainty, they shouldn't be in business. I agree that the players need to HELP fix the game, not run it for the owners. And linkage actually hampers growth. It is the stupid retail way of doing things.....watch this example....

Where I work, sunday is time and a half, so they cut to bare bones staff even though it is the busiest day of the week.
My department does 10 grand on avg on sunday with 24 man-hours
we go down a couple grand on any given Sunday and the store mgr yanks 4 hours away from us....linkage!
result, the following Sunday is almost guaranteed to be busier, but now we are short 4 hours, the job doesn't get done and we lose out on sales and profits. We are barely able to hit the same number as the week before because we simply cannot get enough product out.
now you would think he'd give us those hours back to get sales back up, but today's business men are so focused on the bottom line and the numbers, that all he sees is that we did the amount of business we should with the amount of help that we had. The link to revenues was in balance. They don't look at lost potential sales as lost revenue. Our Sunday "cap" can't be based on one week, and the NHL's can't be based on one season.

If this happens in the NHL, especially if there is a cap this season, (if there is one)
based on the 2.1 billion figure and next years is based on a pro-rated (inflated to approximate 82 games) amount of this season's revenue, the cap is going to get cut almost in half, because I imagine the league will take a big hit from this mess. I am afraid that if the league does not choose to invest in the staff first in order to get bigger profits later, it will start a downward spiral that could eventually cause the NHL to no longer be the top paying league in the world, especially if the game continues to grow at the rate it is in europe. A long shot, but a possibility. Some guys are making as much as 3 million this year over there.

Sorry this is so long winded, but I needed to get all of that out!

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02-06-2005, 04:50 PM
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I really don't know if I have heard this out of a player's mouth. But if the players are willing to accept a cap that isn't linked to revenues because they know revenues will drop significantly over the next few years, that is extremely hypocritical. Aren't they questioning whether the league is losing money to begin with?

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02-06-2005, 05:06 PM
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Quote:
All I know is that to me
You look like you're havin' fun
Open up your lovin' arms
Watch out, here I come

You spin me right round, baby
right round like a record, baby
Right round round round
You spin me right round, baby
Right round like a record, baby
Right round round round
This all has been beaten to death...

Anyway, as soon as they cancel the season we'll be free of all this stuff until next year.

Nothing makes sense anymore. There is a deal to be done, some compromise, but the people at the top of this process are deaf and blind.

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Old
02-06-2005, 05:14 PM
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Originally Posted by WHARF1940
1. as far as the parity in the league....is it possible that we already have too much? Haven't the last few finals that involved small market, non-traditional clubs gotten absolutely horrible ratings?
1995 - New Jersey
1996 - Colorado
1997 - Detroit
1998 - Detroit
1999 - Dallas
2000 - New Jersey
2001 - Colorado
2002- Detroit
2003 - New Jersey
2004 Tampa Bay

In the past 10 years, only 5 different teams have won the cup and only 1 team was from a "small market". That is not parity.

 
Old
02-06-2005, 06:11 PM
  #5
WHARF1940
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Quote:
Originally Posted by Crazy Lunatic
1995 - New Jersey
1996 - Colorado
1997 - Detroit
1998 - Detroit
1999 - Dallas
2000 - New Jersey
2001 - Colorado
2002- Detroit
2003 - New Jersey
2004 Tampa Bay

In the past 10 years, only 5 different teams have won the cup and only 1 team was from a "small market". That is not parity.
NJ is not considered a big, nationally recognized franchise,(they can't even fill their building for the playoffs!) which is what i meant, but did not clearly state. Many different teams have made it there, however. I also was not talking only about who won it but who played in it. Carolina, Anaheim, Tampa....i simply meant that to the casual fan (which is who is really represented in the ratings....we'll always watch , regardless of who is playing) it matters. I know a lot of my friends who have a passing interest in hockey, were making fun of the finals and didn't watch when teams they had very little knowledge about were playing. Who knows, maybe it is marketings fault, but these are the fans that need to be enticed to follow the sport.

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Old
02-06-2005, 06:32 PM
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Quote:
Originally Posted by Crazy Lunatic
1995 - New Jersey
1996 - Colorado
1997 - Detroit
1998 - Detroit
1999 - Dallas
2000 - New Jersey
2001 - Colorado
2002- Detroit
2003 - New Jersey
2004 Tampa Bay

In the past 10 years, only 5 different teams have won the cup and only 1 team was from a "small market". That is not parity.
would you prefer 10 different winners ?

the fact is each of those teams built their team the right way. not one cup was "bought", as the cliche goes.

so whats wrong with this ?

dr

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02-06-2005, 07:06 PM
  #7
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Quote:
Originally Posted by DR
would you prefer 10 different winners ?

the fact is each of those teams built their team the right way. not one cup was "bought", as the cliche goes.

so whats wrong with this ?

dr
what is really sad, and alarming, is thatthe last cup that was "bought", was the rangers' cup, and that generated more interest in the sport than the last 10 combined. As an Islander fan, it pains me to admit this!!

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02-06-2005, 07:32 PM
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Quote:
Originally Posted by WHARF1940
what is really sad, and alarming, is thatthe last cup that was "bought", was the rangers' cup, and that generated more interest in the sport than the last 10 combined. As an Islander fan, it pains me to admit this!!
even they didnt buy it. ... they traded Amonte and Weight to get key pieces and had drafted players like Richter, Leetch and Kovalev play huge roles.

buying is just another cliche. its not possible in the NHL.

dr

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02-06-2005, 08:22 PM
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Quote:
Originally Posted by Crazy Lunatic
1995 - New Jersey
1996 - Colorado
1997 - Detroit
1998 - Detroit
1999 - Dallas
2000 - New Jersey
2001 - Colorado
2002- Detroit
2003 - New Jersey
2004 Tampa Bay

In the past 10 years, only 5 different teams have won the cup and only 1 team was from a "small market". That is not parity.
Let me add a couple of things to this.
1. these are all teams with payrolls in the top 10 w/ most in the top 5 with the exception of Tampa Bay. with the lockout approaching spending habits not exactly what they had been in the past, so last season was kind of an odd season anyway.

2. NJ may not qualify as a large market team, but their payroll does. As of today only Philadelphia and Toronto have committed to more salary for this season, $60.9m.

3. The question is not would 10 winners in 10 years be better than the 5 there were in the last ten years. The question is does the NHL want payroll size to dictate who wins? that is what was happening. You bring up Florida, Washington and Carolina's appearances in the finals. While its true that they were in the finals, its also true that they won, i think, a combined total of one finals game and have made the playoffs a combined twice(both Washington) since losing in the finals.

4. How much did Detroit do it the right way. Their last cup team had Hasek in net, Chelios on defense, Shanahan, Hull, Robitaille. Colorado needed to acquire in salary dump deals $16m in defensemen, Blake and Bourque, in order to get over the top. That franchise is always known for the blockbuster deadline deal involving big name and expensive players.

Yes, these teams were built with some great players drafted, but lets be honest that these teams also keep the teams currently competitive buy adding big money free agents and salary dump deals for big contract players. Blake, Bourque, Roy, Hatcher, Schneider, Lang, Whitney, Hasek, Joseph, Hull, Hull again, Hull again, and so on and so on and so on.

Trying to sell the Detroit Red Wings as a home grown team because they have Yzerman from 20 years ago and Lidstrom from the draft just doesnt fly.

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02-06-2005, 08:45 PM
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Quote:
Originally Posted by txpd
The question is does the NHL want payroll size to dictate who wins?
I think you have missed the thread where the payroll growth was shown to follow the playoff success. So it's more like who wins dictates their payroll size. Attempts to do it the other way around have failed miserably so far.

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Old
02-06-2005, 08:50 PM
  #11
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Originally Posted by DR
would you prefer 10 different winners ?

the fact is each of those teams built their team the right way. not one cup was "bought", as the cliche goes.

so whats wrong with this ?

dr
Oh yes, I would say most of those cups were "bought". Every single team with the exception of Tampa Bay had a top 5 payroll. Colorado, Detroit and Dallas were all as close to "buying" a cup as you can get in hockey. And if Tampa ever wanted to keep that team together, they would need to have a payroll in the 70-80 million dollar range in a next few years.

 
Old
02-06-2005, 08:52 PM
  #12
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Originally Posted by shveik
I think you have missed the thread where the payroll growth was shown to follow the playoff success. So it's more like who wins dictates their payroll size. Attempts to do it the other way around have failed miserably so far.
And how exactly are small market teams supposed to do this? Tampa barely made a penny winning the Stanly Cup last year with what, a 30 million payroll? Under the old CBA, Tampa would have had to up their payroll to a ridiculour 70-80 million to keep that team.

 
Old
02-06-2005, 09:23 PM
  #13
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Originally Posted by Crazy Lunatic
And how exactly are small market teams supposed to do this? Tampa barely made a penny winning the Stanly Cup last year with what, a 30 million payroll?
I was only referring to the fact that for the SC winning teams the high payroll is the consequence of success, not the other way around.

But since you brought it up.

Tampa Bay team sucked for a long time (no offense TB fans). It takes time to build the fan base, so I would not be surprised to learn that the TB revenues are not so good. But if the trip to SC finals would barely make them break even with a 30mil payroll, we should just say good buy to Tampa Bay, because they will only be able to survive in the new NHL (32mil payroll minimum) if they win the Cup every year.

Quote:
Under the old CBA, Tampa would have had to up their payroll to a ridiculour 70-80 million to keep that team.
Oh really? 70-80 million? What, would they bump Lecavalier's salary to 15million? Let's be real here. If TB keeps up its success over a few years, I can see its payroll grow to 45-50 million in 3 years. But a jump from 30 to 70 millions would be plain ridiculous.

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02-06-2005, 09:50 PM
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Originally Posted by shveik
I was only referring to the fact that for the SC winning teams the high payroll is the consequence of success, not the other way around.

But since you brought it up.

Tampa Bay team sucked for a long time (no offense TB fans). It takes time to build the fan base, so I would not be surprised to learn that the TB revenues are not so good. But if the trip to SC finals would barely make them break even with a 30mil payroll, we should just say good buy to Tampa Bay, because they will only be able to survive in the new NHL (32mil payroll minimum) if they win the Cup every year.



Oh really? 70-80 million? What, would they bump Lecavalier's salary to 15million? Let's be real here. If TB keeps up its success over a few years, I can see its payroll grow to 45-50 million in 3 years. But a jump from 30 to 70 millions would be plain ridiculous.
Are you forgetting the NHL MVP Martin St.Louis, what about Brad Richards, Modin and Khabibulin? Add in a hefty raise for Lecavalier (and yes, if Tampa didn't give him a 10 million salary, another team would) and you have one of the leagues biggest payrolls.

 
Old
02-06-2005, 10:12 PM
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Originally Posted by Crazy Lunatic
Add in a hefty raise for Lecavalier (and yes, if Tampa didn't give him a 10 million salary, another team would) and you have one of the leagues biggest payrolls.
who would ? this isnt SIM hockey, no one makes RFA offers in the NHL.

next.

dr

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02-06-2005, 10:16 PM
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Quote:
Originally Posted by Crazy Lunatic
Are you forgetting the NHL MVP Martin St.Louis.
what about him ?

under the NHL's proposal, if Marty files for arbitration, the team can automatically sign him for a 5% increase and avoid arbitration.

seems like a good deal for the players huh.

dr

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02-06-2005, 10:18 PM
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Barely made a penny? Didn't the Forbes report say they made $8 million last season? That doesn't make up for all the losses they racked up in the years before, but that's still pretty profitable compared to most teams in the league, though I guess that's more of a comment on the league itself..

Edit: In fact the Lightning had the 4th highest operating income last season. http://www.forbes.com/lists/results....y&passKeyword=

Still they're going to need help to keep the core together with a new CBA.


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02-06-2005, 10:19 PM
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Players have gotten huge salaries even though they were not UFA's, isn't Pronger an example?

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02-06-2005, 10:33 PM
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Originally Posted by Machiavelli
Players have gotten huge salaries even though they were not UFA's, isn't Pronger an example?
that had nothing to do with the CBA. whats your point ?

dr

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02-06-2005, 10:54 PM
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Quote:
Originally Posted by shveik
Oh really? 70-80 million? What, would they bump Lecavalier's salary to 15million? Let's be real here. If TB keeps up its success over a few years, I can see its payroll grow to 45-50 million in 3 years. But a jump from 30 to 70 millions would be plain ridiculous.
Three years? You know Tampa *already* is over $40 million, and without St. Louis signed? Which means that for *this* season, they're around $46+ million at least.

Which is why I don't buy the Tampa/small salary argument. If that Gelinas near-goal is counted in game 6, Tampa has a $45+ million salary this year anyways. It wasn't winning the Cup that made them get that high, they were that high regardless.

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02-06-2005, 10:57 PM
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Quote:
Originally Posted by Crazy Lunatic
And how exactly are small market teams supposed to do this? Tampa barely made a penny winning the Stanly Cup last year with what, a 30 million payroll? Under the old CBA, Tampa would have had to up their payroll to a ridiculour 70-80 million to keep that team.
FYI - Tampa's payroll was $31M last season, and if there was a full season this year, salaries would be at $40M without Marty St. Louis and there's still two other roster spots open (1 Dman/1 Forward). Next season 05-06 would be an even bigger increase since only 8 players currently have contracts thru 05-06.

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02-06-2005, 11:03 PM
  #22
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Originally Posted by DR
under the NHL's proposal, if Marty files for arbitration, the team can automatically sign him for a 5% increase and avoid arbitration.

seems like a good deal for the players huh.
And of course, should they do that, Marty can choose a term of one year, and then get his arbitration the next year.

And you're completely ignoring his other option, that of sitting down with Tampa and negotiating a huge contract *without* arbitration.

But no, foks try and paint it as if they'll be destitute forever.

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02-06-2005, 11:06 PM
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Quote:
Originally Posted by PecaFan
And of course, should they do that, Marty can choose a term of one year, and then get his arbitration the next year.

And you're completely ignoring his other option, that of sitting down with Tampa and negotiating a huge contract *without* arbitration.

But no, foks try and paint it as if they'll be destitute forever.
yup and if the owners werent asking for a hard cap ontop of this new arbitration twist, they would be reasonable in asking for it.

however, not only do they want the ultimate cap, they also want a whole lot of other tools.

its too much to ask for and expect a resolution. its like they dont even want a home run, they want a grand slam.

its not the way to get a negotiated settlement. of course, its clear they arent interested in a negotiated settlement. they are quite content to play this out and see what they can get by breaking the union.

dr

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02-07-2005, 01:23 AM
  #24
shveik
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Originally Posted by PecaFan
Three years? You know Tampa *already* is over $40 million, and without St. Louis signed? Which means that for *this* season, they're around $46+ million at least.

Which is why I don't buy the Tampa/small salary argument. If that Gelinas near-goal is counted in game 6, Tampa has a $45+ million salary this year anyways. It wasn't winning the Cup that made them get that high, they were that high regardless.
Well, so it would've been a jump from 31 to 46 million. Still a far cry from 70-80, isn't it? Either way, that's not the point, the Tampa Bay are not buying the Cup, but they are paying for it nevertheless. Just like any other team before them.

The only question is if the Tampa market can support an elite team or not. With cap, it would be more of a question if the prospect pipeline can sustain the constant drain of talent forced by the cap. Right now the small market teams are in this situation, when they sometimes have to ship their star players away. With the cap, everybody will be in the same shoes, and watch their stars shipped to the teams that can't draft worth a lick, and because of that have cap room.

Let me summarize.

1. Without the cap, you can try to maintain a star team if the success helps you grow the market. If the market growth is limited (small market teams) you can only have a short term success.

2. With the cap, everybody is limited to the short term success, so in a way everyone becomes a small market team. I can understand the pain of small market team fans, what I do not understand is why so many of them want everybody to join them. It's not going to help you, you know

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02-07-2005, 04:19 AM
  #25
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Quote:
Originally Posted by shveik
1. Without the cap, you can try to maintain a star team if the success helps you grow the market. If the market growth is limited (small market teams) you can only have a short term success.
I agree, I think this is essentially true.

Quote:
2. With the cap, everybody is limited to the short term success, so in a way everyone becomes a small market team.
This is not, however. There is nothing inherent in a cap that makes long term success unachievable. There'll still be the bottom feeders with crappy management that are lousy for a decade. And they're still be the great teams, contenders year after year.

All a cap does is adjust *opportunity*. It provides it to all, instead of the select few like exists in (1).

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