Blogs by Patrick J McCormick
Hockey: The Non-Season
2/15/2005 9:49:57 PM
Hockey: the Non-Season
I cannot say I have been following all the details of the dispute between the NHL and its players, and cannot say that I have missed watching the games; I lost interest a long time ago. I think a lot of the deprived fans actually feel the same way, and I do not think that bodes very well for either the league or the players. There is no question the two principal players in the dispute Bettman and Goodenow have to go and I am not sure the same shouldn’t also be said for Bill Daly who on TV at times seemed reasonably happy things were not going well. The league is in a mess and it has to be fixed. The consensus at the start of the non-season was that the players were making too much money and the league was losing too much money. Bettman persuaded most fans and the sports media that the players were therefore to blame, but I have to say that if the league could not afford to pay those high salaries then why did it agree to pay them. Bettman would probably point to the arbitration awards, but I understand that these awards are based on the salaries of other players of a similar degree of skill. I would think the salaries paid freely to those other players are therefore the root cause and not the arbitration awards. The amount of money the league claimed it was losing at the start of the season apparently ignored some revenue, which would seem to indicate the League was padding the losses to gain more sympathy.
Since the start of the non-season the Players Association has made some concessions, but Bettman still insists on having a salary cap. Goodenow suggested the league should consider some form of revenue sharing, but Bettman cast that aside with the comment ‘there has never been a history of revenue sharing in the NHL”. Well Gary as I understand it there has never been a history of Salary caps in the NHL either, so how do you justify insisting on starting the history for one while ignoring the other? The truth is that some teams like New York, Philadelphia and Toronto are doing very well. If Bettman succeeds in getting a salary cap in might succeed in stopping the bleeding of the financially weaker teams, but the teams which are making a profit now will make an even bigger profit. There has been a suggestion that the price of tickets would be reduced if the players agreed to a salary cap. I think this was just thrown out by the league in an attempt to get more fan support. If Gary manages to get fans to believe that he should get into the Florida swamp real estate business, which could be very profitable. Without any kind of revenue sharing the salary cap would have to be based on the revenue of the weakest team for that team to survive. The owners of the teams in Toronto and New York are probably rubbing their hands together in glee at that one. Then there is the other situation of new teams coming in (Bettman has done a lot of that), what if they start to struggle and their revenue is below the salary cap, will the league want to lower the salary cap to take care of that. This could be very good business for the owners of the Toronto and New York teams, Not only would they now make an even bigger profit from each season, but they get a good slice of the entrance fees as well. I think if you pull that off Gary, you should be asking those teams for a big fat bonus, and if you manage to break the Players Union, which I suspect may be the main item on your agenda, you should ask for an even bigger bonus.
The truth of the matter is that the NHL caused this problem themselves. Having said this however I cannot agree with Goodenow’s attitude that why should they help the league to fix a problem the league caused. The player’s association did take advantage of the situation and have to help to fix it. The league brought in several teams from small market areas and those teams had to compete with the larger market teams for players. The larger market teams had the money and could easily outbid the newer teams for key players. Those newer teams needed the star players to sell the game in their area, and they had to pay the salaries for those players. The newer teams in many cases were caught in a difficult situation. Go out of business because they could not pay the salaries of the star players and no one came to their games, or go out of business because they paid the high salaries and ran out of money. The salary cap will give these newer teams some protection since they will be able to compete for players on a more even playing ground, but it is a windfall for the established teams. Some teams will probably still have difficulty affording the salary caps mentioned, and some will no doubt go out of business, but the established teams will still play the same number of games with the remaining teams.
The players have to be concerned about the teams going out of business since it means fewer jobs. They would like to see all the teams staying in business, but do not want to be the only group paying for this, which is why they are suggesting revenue sharing. When you think about this, a game requires two teams, what is wrong with each team sharing equally in the revenue from that game. The established teams will be very quick to point out most of the people at their home games are their fans, and if the new teams can’t attract the fans that is their problem. I think we need to point out to those teams they are a major part of the problem in the high salaries. They are the major force behind Bettman in the lockout and charged a big fat entrance fee to each of these new teams. Are they prepared to pay those fees back if they kill the league? Perhaps the newer teams should be seeking a stronger association with the players since the players approach would benefit them more than the approach of the established teams.
I think the league should look at revenue sharing. Without knowing any of the revenue figures of each of the teams I played around with a sharing formula and it did not seem to hurt the established teams too much, in fact the hurt could probably be made up with salary concessions from the players. It did help the poorer teams. Before killing the season those who do know the figures involved should check it out. Check it out that is if their agenda really does include trying to come to an agreement, and not just breaking the players association.
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Hockey: The Non-Season - Tuesday, February 15, 2005
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