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Report on NHL losses...

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Old
02-12-2004, 03:39 PM
  #1
Fletch
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Report on NHL losses...

http://www.usatoday.com/sports/hocke...es-study_x.htm

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02-12-2004, 04:39 PM
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Nineteen teams lost money, while 11 made a profit. The largest team loss was $40.9 million. The largest profit was $14.6 million.
Basically, this study has shown that 2/3 of the owners and managers in this league don't know how to run a profitable business. As a manager, why would you willfully approve a payroll that guarantees an economic loss, then turn around and blame the players and their union for the financial disaster you've created?

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02-12-2004, 05:31 PM
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Maybe...just maybe...its because some owners realise you can't run a pro sports team as though its a business.

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02-13-2004, 01:05 AM
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and generally when you have a business that isnt profitable you have the option of turning it into a profitable business, that option isnt always as clear cut in sports because based on that analogy you'd have to put together a borderline NHL team to turn a profit and then you won't get anyone to go to the games so you lose money anyway.

When i start my own firm, i have options so that i can turn a profit and offer a better service, I know i'm not likely going to have to pay ALL of my public relations practicioners $120,000 each. Now hockey has become so bad that even borderline NHL'ers are guranteed to make half a millon each. Essentially you could have a team full of fourth line goonds making no more than a million dollars and your payroll is STILL gonna ge over 20 million dollars. Now a team full of 4th liners isn't gonna draws crowds for very long and you're gonna lose money fast. So how far do you cut expenses? Basically the league salaries are too high for the popularity of the sport. Even the best business minds in the world couldn't win with the current hand of cards.

Right now there needs to be some economic change in the game or else you're gonna have a league of 13 teams.

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02-13-2004, 08:54 AM
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It's not the league's job to determine what market will bear in terms of salaries. It's the job of the owners and managers. I agree that they're stuck between a rock and a hard place TODAY, but it was their own fiscal irresponsibility that created the situation they now claim to be a victim of. If the league had more Harry Sindens and fewer Ted Leonsis', ie. people who know how to manage the economics a sports franchise, the league would not be in this situation. The time to take a stand against slimming profit margins is not when the economics of the market have already been shot to hell. It shouldn't take a top financial manager to tell anyone that.

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02-13-2004, 02:10 PM
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the problem is that teams like the rangers, detroit and colorado threw everything out of whack.

When you look at the NHL it's not 30 out of 30 teams that made salaries out of this world, it was really only 5 -10 teams at the most.

however i believe the nhl itself also must look in the mirror and say "why did we expand so much", as that helped to put a premium on good players because hockey doesnt have the feeder system or pipe lines that other sports do {as a result of expense, exposure, interest, etc.}.

In conclusion the league is grave danger right now. i doubt the nhlpa lets them reduce teams or pass a salary cap but frankly the game cannot survive in its current state.

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02-13-2004, 02:28 PM
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The bottom line is that at this point, who's to blame for the current state of the game is irrelevant. Although the two sides seem to do a lot of that, along with silly posturing. (Like JR's, 'we can outlast the owners, we''ll just go play in Europe' remark.) But it's all pointless. If fingerpointing and empty rhetoric were solutions to the game's problems, the NHL would have achieved fiscal utopia long ago.

They all have the obligation to fix it, regardless of who broke it. Both sides are going to have to make concessions and compromises. The survival of the league depends on it. A work stoppage would be fatal, a lot cities cities out there would quickly come to realize that they could live without the NHL.

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02-13-2004, 02:51 PM
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I read further today that....

there is a target % they want salaries league-wide to be of revenues (I forget the target, perhaps 50-60%) which equates to about $30+ million per team (and contraction of the league is not an option).

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02-13-2004, 03:11 PM
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the NHL should try a luxury tax if the players won't agree to a cap, at least until teams like the Wings, et al can get their spending under control (and perhaps Illich was then focus more attention on the Tigers). The problem is when teams over pay on guys, like Iginla, no way should he be making as much as he does in Calgary, but they paid him that much anyway. The NHL is deep doo doo as long as the expenditures are favoring the players as much as they are.

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02-13-2004, 03:59 PM
  #10
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Quote:
Originally Posted by Fletch
there is a target % they want salaries league-wide to be of revenues (I forget the target, perhaps 50-60%) which equates to about $30+ million per team (and contraction of the league is not an option).
I read similar things. What essentially Bettman & Co. are promising to each other is a $31m hard cap and not contraction.
There are several problems w/ that. First of all, we all know that no teams are going to get contracted. However, they as much admited that there was no need to expand by 4 teams. Even if the NHL's claims are true about having a $300m warchest with wich to go to was with, I just don't see how 4-6 teams will be able to survive w/ no season. Getting rid of 4-6 teams would make the league A LOT better.
And the other problem is that the $31m cap is there for only 1 reason. To cater to the Canadian teams. That, in itself, is why such a low hardcap is so stupid. You cannot have equality when you are dealing w/ international economics. Why should the US teams be forced to only be able to spend what the Canadian teams can afford to spend because of the difference in valuation of the Canadian $ to the US $?
Such a low cap # is assinine. Heck, the Devils would have to shred close to $25m off of their payroll and I do not think that anyone would call them lavish spenders.

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02-13-2004, 04:10 PM
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Quote:
Originally Posted by Edge
however i believe the nhl itself also must look in the mirror and say "why did we expand so much", as that helped to put a premium on good players because hockey doesnt have the feeder system or pipe lines that other sports do {as a result of expense, exposure, interest, etc.}.

.
This is one of the biggest problems and worst mistake the NHL has on it's plate.

21 teams to 30 in a decade????

Good call guys.

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Old
02-13-2004, 04:22 PM
  #12
Edge
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fact is, the league is a mess and it seems everyone but the two opposing sides seem to know that concessions need to be made on both sides

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