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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.

Storm Clouds Brewing in NHLPA - Chris Chelios the Peacemaker???

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Old
06-09-2017, 06:07 PM
  #26
Legionnaire11
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But if the players had accepted earlier offers, they could have had a higher​ cap and lower salary rollback. But they insisted on no cap, or no hard cap. When everyone in the universe knew that the cap was inevitable.

Many teams were better off financially by not playing that season, how did the players actually think they were going to outlast the owners?

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06-11-2017, 04:06 PM
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Friedman on Chelios' possible role in NHLPA
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It is a very difficult time for the NHLPA. You’re familiar with the concerns about player escrow, but the loss of Olympic participation (and the realization it did not get negotiated into the CBA this time around) have really blown the doors off the building. As has been reported, agents Kurt Overhardt, Anton Thun and Ritch Winter have been particularly vocal, although more are weighing in on both sides of the discussion. It’s getting nasty.

A couple of the agents I spoke to this week made it clear that their clients are most concerned for business reasons, since the cap is flattening. Those players feel strongly another CBA fight is a waste of time; that “growing the game” should be, by far, the No. 1 priority for both the NHL and NHLPA. There is definitely a movement to have Chris Chelios installed as ombudsman, and if you remember his Hall of Fame speech, you know he’s passionate about player causes.

The ombudsman position is tricky, it caused a lot of friction between Paul Kelly and Eric Lindros when both served in the union. But some agents say they’d prefer the NHLPA’s executive board create a “subcommittee of the board” to consult on an ongoing basis with the executive director (Don Fehr), as per the organization’s constitution. They think their clients would be better served by that apparatus. Whatever the case, changes are coming.

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06-11-2017, 07:47 PM
  #28
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Originally Posted by cheswick View Post
The only way is to reverse the situation. Lower the salary cap to be 50% of revenue. Then all players would receive their full contracts. At year end the owners would have to kick in additional money to reach the 50% and players would get a year end bonus. In the end it would be the same thing but the players would get the value of what their contracts say and rather than paying escrow over the course of the season the owners would be paying the escrow if you will.
Lowering the salary cap to be 50% of revenue means an ~ 20% rollback in salaries to make it work. Are the players voting for that?

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06-11-2017, 07:50 PM
  #29
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The last two work stoppages have been lockouts by the owners. It wasn't because of demands of the players. They were both because of demands by the owners. The question is what are the owners going to be looking for in the next CBA.
A big part of the lockouts though were the players refusing to honor their promise of no work stoppage in the 1992 season, then breaking their work just before the playoffs. The minute they did that they all but guaranteed the owners would never enter another season without a CBA. They shot themselves in the foot over that one.

And of course the owners were demanding changes. They were losing 100's of millions per years while the players were making billions per year. Of course that has to change.

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06-11-2017, 09:10 PM
  #30
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Originally Posted by ottawah View Post
A big part of the lockouts though were the players refusing to honor their promise of no work stoppage in the 1992 season, then breaking their work just before the playoffs. The minute they did that they all but guaranteed the owners would never enter another season without a CBA. They shot themselves in the foot over that one.

And of course the owners were demanding changes. They were losing 100's of millions per years while the players were making billions per year. Of course that has to change.
I agree...for me I wouldn't call it a big part, IMO it is the single reason




Regarding the quote from the Friedman article saying "You’re familiar with the concerns about player escrow, but the loss of Olympic participation (and the realization it did not get negotiated into the CBA this time around) have really blown the doors off the building" - wow! really?

Seems to me a bunch of NHLPA lawyers/negotiators should really be working at McDonalds now (how have Fehr and others kept their jobs?)
Agreed to escrow but didn't get players to understand what escrow is for years, forgot about the Olympics....wow, just wow

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06-11-2017, 09:24 PM
  #31
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Quote:
Originally Posted by Nino33 View Post
I agree...for me I wouldn't call it a big part, IMO it is the single reason




Regarding the quote from the Friedman article saying "You’re familiar with the concerns about player escrow, but the loss of Olympic participation (and the realization it did not get negotiated into the CBA this time around) have really blown the doors off the building" - wow! really?

Seems to me a bunch of NHLPA lawyers/negotiators should really be working at McDonalds now (how have Fehr and others kept their jobs?)
Agreed to escrow but didn't get players to understand what escrow is for years, forgot about the Olympics....wow, just wow
Let's not forget the Baseball strike as well.

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06-11-2017, 09:30 PM
  #32
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Originally Posted by Nino33 View Post
Regarding the quote from the Friedman article saying "You’re familiar with the concerns about player escrow, but the loss of Olympic participation (and the realization it did not get negotiated into the CBA this time around) have really blown the doors off the building" - wow! really?

Seems to me a bunch of NHLPA lawyers/negotiators should really be working at McDonalds now (how have Fehr and others kept their jobs?)
Agreed to escrow but didn't get players to understand what escrow is for years, forgot about the Olympics....wow, just wow
It is amazing how most of the articles indicating how upset the players are with escrow seem to betray a lack of how it or basic math works. Escrow won't just be magically lowered without a reworking of the cap system itself.

I have no idea if the NHL had any idea how important the Olympic issue would become at least as a media talking point but they've clearly gained a bargaining chip without giving up anything, and this upcoming Olympics not being included in the CBA seems either brilliant on the NHL's side, or incompetent on the NHLPA's.

Really will be interesting to see how the next CBA goes as an observer, though I think the attempted Olympics for extended current CBA offer gives some hope of a non-lost games solutions, we shall see, I don't underestimate the greed involved.

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06-11-2017, 09:41 PM
  #33
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I wonder if the NHL can just set the cap at the previous years revenue numbers instead of the current year. Wouldn't need any escrow at all if the cap number is 100% known before the season started.

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06-11-2017, 09:42 PM
  #34
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Originally Posted by BaccusDrunk View Post
It is amazing how most of the articles indicating how upset the players are with escrow seem to betray a lack of how it or basic math works. Escrow won't just be magically lowered without a reworking of the cap system itself.

I have no idea if the NHL had any idea how important the Olympic issue would become at least as a media talking point but they've clearly gained a bargaining chip without giving up anything, and this upcoming Olympics not being included in the CBA seems either brilliant on the NHL's side, or incompetent on the NHLPA's.

Really will be interesting to see how the next CBA goes as an observer, though I think the attempted Olympics for extended current CBA offer gives some hope of a non-lost games solutions, we shall see, I don't underestimate the greed involved.
IF, and that's a big IF, the players don't use the escalator, they will lose 5% less in escrow. That might be enough to keep them satisfied. They are balancing the possibility of high $$ contracts for this year's free agents with a higher escrow loss.

And, you are right. You could rework the CBA to something like this:
Keep the 50% payout.
Move the cap midpoint to 47% of HRR. That way, if the teams all spend to the cap, there is less escrow loss.

But, doing that again means a one year adjustment in free agent contracts.

And, you are also right that it is greed that drives the whole thing.

Again, I say that the owners are the ones with the big problem, because their needs are so different from each other because of the difference in local revenues from Toronto/Montreal/NYR to Arizona/Carolina/Florida.

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06-11-2017, 10:13 PM
  #35
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Originally Posted by MNNumbers View Post
IF, and that's a big IF, the players don't use the escalator, they will lose 5% less in escrow. That might be enough to keep them satisfied. They are balancing the possibility of high $$ contracts for this year's free agents with a higher escrow loss.

And, you are right. You could rework the CBA to something like this:
Keep the 50% payout.
Move the cap midpoint to 47% of HRR. That way, if the teams all spend to the cap, there is less escrow loss.

But, doing that again means a one year adjustment in free agent contracts.

And, you are also right that it is greed that drives the whole thing.

Again, I say that the owners are the ones with the big problem, because their needs are so different from each other because of the difference in local revenues from Toronto/Montreal/NYR to Arizona/Carolina/Florida.
I think the lack of escalator this year (if it happens) is a smart sell by the NHLPA management to the players with Vegas coming in. I really can't imagine they have the wherewithal to stick with it in the future.

I would agree that owners vs fans (though the real fight is always NHL vs NHLPA) the biggest issue is the lackluster revenue sharing/non-massive TV contract since it leads to these inevitable CBA fights, though I think as an internal matter the NHL has been pushing towards owners who can absorb minor year to year losses for overall franchise value gain. I don't know that as a whole the NHL has any other real choice, I can't see a likely period where all teams make a profit/break even. The lower end in the NHL = actual losses without a decent TV gain & adjacent revenue sharing, if they can limit those losses to single digit (millions), it probably continues to work long term. Upcoming TV deal will be the clear signal. IE, CBA after this one, the TV deal will signal massive serious lockout for concessions vs ongoing current deal in some form.

Obviously the monetary reality is different, but the NHL seems to have more over the NHLPA this upcoming negotiation then they normally do, so I'm more interested in if the NHL is happy to continue the current (minor modifications) vs pushing something drastic (ie, kill guaranteed contracts or something), so we shall see where the greed level is. I again think the offered Olympics for CBA extension means we're at a CBA point where the NHL feels it's profits are adequate vs squeezing for more blood. Clearly some owners will just squeeze for the sake of it (Hi Mr Jacobs).

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06-11-2017, 10:18 PM
  #36
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Originally Posted by BaccusDrunk View Post
this upcoming Olympics not being included in the CBA seems either brilliant on the NHL's side, or incompetent on the NHLPA's.
It has to be incompetence on the NHLPA's side IMO
Just like the NHLPA not understanding escrow (and whining about it)...
It's not like either issue is complicated...

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06-11-2017, 10:27 PM
  #37
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Originally Posted by MNNumbers View Post
This is exactly the reality. Look at the reasons Bettman gave for the last one....Essentially, "We are paying too much to the players, and so our franchises are in a bad spot."

Now, on this board we all know that the problem is that there is WAY (like 2 or 3 times or more) more local revenue in Toronto than in Carolina or Arizona. So, that guarantees that the owners will pull the same argument. And, to make that worse, the winds are blowing that national broadcast revenue will be LESS next time, because of cord cutters. Which simply, percentage wise, makes the problem worse.

The question is: How low will the owners try to go?

And, how far will the PA push back with proposals that require greater revenue redistribution?

Interesting times on the BoH....
I think the owners will be fine continuing the 50/50 HRR split.

I expect their focus will be on either eliminating guaranteed contracts or limiting the max contract length to something like 6 years instead of 8 years.

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06-11-2017, 10:31 PM
  #38
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Originally Posted by McRpro View Post
I wonder if the NHL can just set the cap at the previous years revenue numbers instead of the current year. Wouldn't need any escrow at all if the cap number is 100% known before the season started.
It is set based on the previous season revenue. One key element is that the prior revenue is used to set the cap midpoint, not the ceiling. If I correctly understand what you're suggesting you would have to drop the cap by about $10m to avoid an escrow risk.

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06-11-2017, 10:31 PM
  #39
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Originally Posted by BaccusDrunk View Post
I think the lack of escalator this year (if it happens) is a smart sell by the NHLPA management to the players with Vegas coming in. I really can't imagine they have the wherewithal to stick with it in the future.

I would agree that owners vs fans (though the real fight is always NHL vs NHLPA) the biggest issue is the lackluster revenue sharing/non-massive TV contract since it leads to these inevitable CBA fights, though I think as an internal matter the NHL has been pushing towards owners who can absorb minor year to year losses for overall franchise value gain. I don't know that as a whole the NHL has any other real choice, I can't see a likely period where all teams make a profit/break even. The lower end in the NHL = actual losses without a decent TV gain & adjacent revenue sharing, if they can limit those losses to single digit (millions), it probably continues to work long term. Upcoming TV deal will be the clear signal. IE, CBA after this one, the TV deal will signal massive serious lockout for concessions vs ongoing current deal in some form.

Obviously the monetary reality is different, but the NHL seems to have more over the NHLPA this upcoming negotiation then they normally do, so I'm more interested in if the NHL is happy to continue the current (minor modifications) vs pushing something drastic (ie, kill guaranteed contracts or something), so we shall see where the greed level is. I again think the offered Olympics for CBA extension means we're at a CBA point where the NHL feels it's profits are adequate vs squeezing for more blood. Clearly some owners will just squeeze for the sake of it (Hi Mr Jacobs).
I think I mostly agree. The media contracts run for another CBA cycle (or, at least into it), so, the NHL being very reactive, rather than fore-sightful, won't worry about that. Arizona is in trouble, but that's not new at all. The other fires are just smoldering. Islanders situation is most interesting. So, there is likely not enough push from enough owners to need to scale back the players share of HRR yet.

Players likely want World Cup defined at HRR. Players don't like escrow, but that's a math problem, not a real complaint. Players don't like NOT going to the Olympics.

I think that the Olympics are the big thing in the next CBA negotiations.

The round after that will be the hard one, because of nat'l media changes....

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06-11-2017, 10:40 PM
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Originally Posted by MNNumbers View Post
I think I mostly agree. The media contracts run for another CBA cycle (or, at least into it), so, the NHL being very reactive, rather than fore-sightful, won't worry about that. Arizona is in trouble, but that's not new at all. The other fires are just smoldering. Islanders situation is most interesting. So, there is likely not enough push from enough owners to need to scale back the players share of HRR yet.

Players likely want World Cup defined at HRR. Players don't like escrow, but that's a math problem, not a real complaint. Players don't like NOT going to the Olympics.

I think that the Olympics are the big thing in the next CBA negotiations.

The round after that will be the hard one, because of nat'l media changes....
I doubt that's a CBA issue for the players. The WCoH is already treated pretty much the same as HRR--NHL and PA each get a 50/50 split after costs. The PA gets to decide how to distribute their 50% share among the union membership.

It makes sense not to include WCoH directly in HRR since the event doesn't take place every year.

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06-12-2017, 06:18 AM
  #41
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Originally Posted by McRpro View Post
I wonder if the NHL can just set the cap at the previous years revenue numbers instead of the current year. Wouldn't need any escrow at all if the cap number is 100% known before the season started.
The owners can, but the players have the ability to increase the salary cap by 5% unilaterally regardless of where revenues go (called the escalator). They have used that very liberally in the past even when the revenues did not justify it. When they do that, it does not increase the money the players get, it stays flat because escrow will rise to match it.

Not to blame one party, because they both came up with this system, but the players have to realize that it has been their consistant use of the escalator when revenues did not justify a cap raise that s responsible for escrow.

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06-12-2017, 09:42 AM
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Players likely want World Cup defined at HRR. Players don't like escrow, but that's a math problem, not a real complaint. Players don't like NOT going to the Olympics.
Given the small percentage of players this affects, I'm still not convinced that a majority of the NHLPA cares about the Olympics

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06-12-2017, 11:48 AM
  #43
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The owners can, but the players have the ability to increase the salary cap by 5% unilaterally regardless of where revenues go (called the escalator). They have used that very liberally in the past even when the revenues did not justify it. When they do that, it does not increase the money the players get, it stays flat because escrow will rise to match it.

Not to blame one party, because they both came up with this system, but the players have to realize that it has been their consistant use of the escalator when revenues did not justify a cap raise that s responsible for escrow.
Actually the PA does not have a unilateral right to apply the 5% escalator. We've just never seen the NHL object to it.

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06-12-2017, 12:24 PM
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I swear some people on this board would rather have a perpetual lockout than another NHL season.

Bettman is not some hero. He's a businessman who looks out for the narrow interests of his franchise owners, at the expense of the players, the fans, and the health of the sport.

The cycle of lockouts will never end until the fans say enough is enough.

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06-12-2017, 01:36 PM
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Actually the PA does not have a unilateral right to apply the 5% escalator. We've just never seen the NHL object to it.
Not saying that is not true, but its the first time I have ever heard of it. My understanding has always been that the NHLPA makes the decision.

Most owners probably like it anyway, so I can understand why they would not object.

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06-12-2017, 02:36 PM
  #46
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i got admit the " grow the league" anthem the nhlpa war going on tickles me.. when they had the best opportunity they mocked the idea .....

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06-12-2017, 03:51 PM
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In any case does this showcase Fehr as the fraud he really is?

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06-13-2017, 12:06 PM
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I still can't figure out what would be the contentious issue that the two sides would be completely unable to come to an agreement on to the point that there would be a league stoppage, which is just bad for everyone (no one getting paid).

All the lockout talk seems to be media hype more than anything else, there's no logical reason it would go that far.

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06-13-2017, 03:29 PM
  #49
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Not saying that is not true, but its the first time I have ever heard of it. My understanding has always been that the NHLPA makes the decision.

Most owners probably like it anyway, so I can understand why they would not object.
CBA

(Preliminary HRR for the prior League Year multiplied by fifty (50) percent (the Applicable Percentage), minus [-] Projected Benefits), divided [/] by the number of Clubs then playing in the NHL (e.g., 30), shall equal [=] the Midpoint of the Payroll Range (which figure shall be considered the Midpoint only for purposes of calculating the Adjusted Midpoint; all references to the "Midpoint" thereafter shall mean the "Adjusted Midpoint"), which shall be adjusted upward by a factor of five (5) percent in each League Year (yielding the Adjusted Midpoint, which shall then become the Midpoint of the Payroll Range) unless or until either party to this Agreement proposes a different growth factor based on actual revenue experience and/or projections, in which case the parties shall discuss and agree upon a new factor.

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06-13-2017, 05:01 PM
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I swear some people on this board would rather have a perpetual lockout than another NHL season.

Bettman is not some hero. He's a businessman who looks out for the narrow interests of his franchise owners, at the expense of the players, the fans, and the health of the sport.

The cycle of lockouts will never end until the fans say enough is enough.
Same goes for the players. They are looking out for their own interests, at the expense of the fans and the health of the sport.

The reality is fans have no backbone. Each lockout, whether player or owner initiated, we come back in droves. We keep paying the higher ticket prices to pay the average player > $3M a year and fatten the pockets of billionaire owners.

The only people we should expect to act in our interests are ourselves (which we don't collectively). You can look for examples in Europe soccer, like some of the English clubs, where fans do a better job of organizing themselves and making collective demonstrable actions in their interests that force owner/player actions. Not saying that they are perfect by any means however.


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