How to fix the NHL...

[Arles]

Now that the season is over, I figure that the collective minds at FOFC could come together and find a solution that somehow elluded tweedle dee (Bettman) and tweedle dum (Goodenow). I will get the ball rolling, but expect to see better ideas ;)

The NHL brings in about $2.2 billion in revenue. So, I would first set a "soft" cap of 60% of the revenue - that's about $44 million. I would then transform it to a hard cap at $49 million (about 68%). Any dollar spent over $44 million would go dollar for dollar into the revenue sharing piece as a luxery tax of sorts. Next, I would setup the league to have 20% revenue sharing. That means that all the teams would contribute 20% of their yearly revenue into a pot that also included the TV and merchandising revenue, as well as any luxery tax for that season. Then, that total amount would be split equally among all 30 teams. That amount would probably end up being slightly less than $20 million per team.

Finally, I would have a salary floor of $25 million (or 35% of the revenue). Any team that goes under that amount would forfeit an equal amount of their revenue sharing. So, if a team wanted to only pay $20 million, their piece of the revenue sharing would be cut from $20 million to $15 mil.

Now, I know this system isn't perfect but it ensures that atleast 35% of the total revenue is spent on the players and allows for a max amount of 68% of the revenue to go to players if the league is booming and everyone hits the hard cap limit. It also gives smaller market teams atleast $20 million to play with in revenue sharing, meaning they only have to earn an extra $5 million to meet the salary floor. I also think that there would have to be adjustments on the arbitration setup and some changes in the league's rules to eliminate the grabbing in the neutral zone at a minimum. Any thoughts?

[General Mike]

Revenue sharing won't work. Teams that own their own TV networks, like the Rangers and Bruins, will find ways to hide revenues.

NHL will not be bringing in 2.2B in revenues in 2005-06. Why should the NHL players get a higher percentage of whatever the ammount is, then NBA or NFL or MLB players make.

[albionmoonlight]

Contraction seems like it might be an option. It will increase the overall talent in the game, and the league can focus more on developing what it has instead of expanding as fast as possible. It would work even better if the NHL got rid of some of the "outpost" franchises and marketed it as "remembering the true fans."

[Arles]

Revenue sharing won't work. Teams that own their own TV networks, like the Rangers and Bruins, will find ways to hide revenues.
Then maybe do a higher % of gate receipts, parking and other easily trackable items.

NHL will not be bringing in 2.2B in revenues in 2005-06.
Then the cap would be lower.

Why should the NHL players get a higher percentage of whatever the ammount is, then NBA or NFL or MLB players make.
Because the NHL has been unable to negociate a competant TV deal. Therefore, the % will end up being at or above those other leagues. If the NHL can ever get a better TV deal and more league revenue, the % could be revisited and lower a bit in a future deal. But, at this point, the NHL is not bringing in the revenue that the other sports are doing so they are going to end up having a higher % cap until that changes.

[Arles]

Contraction seems like it might be an option. It will increase the overall talent in the game, and the league can focus more on developing what it has instead of expanding as fast as possible. It would work even better if the NHL got rid of some of the "outpost" franchises and marketed it as "remembering the true fans."
The problem is that many of those "outpost" franchises are much more financially viable (recent new stadiums, higher attendence, bigger market for TV) than some of the original franchises. Still, you could probably get rid of 4-5 franchises that are on the ropes. Of course, that would also be removing 125 jobs for players in the NHL. I would think that the player's union would prefer some kind of revenue sharing before that would happen.

[Anthony]

i agree with albion: i'd love to see about 4 or 5 teams contract, and have that talent be spread to the remaining teams.

[General Mike]

Contraction seems like it might be an option. It will increase the overall talent in the game, and the league can focus more on developing what it has instead of expanding as fast as possible. It would work even better if the NHL got rid of some of the "outpost" franchises and marketed it as "remembering the true fans."

I don't mind the elimination of teams, but I don't like the idea of contraction. If a team goes bankrupt, I have no problem with them going out of business. The NHL can bail them out for the rest of the season (because I don't think its good for a team to just dissapear in the middle of the year) and then get rid of the team after the season.

[Chubby]

think i already posted this here once before...

*$35 million salary cap.
*Cap increases/decreases in relation to the television revenue increases/decreases.
*Gradual implementation of the cap over a three (3) year period. Teams over the cap for
the first 3 years of the CBA are allowed to resign players already under contract to lower
salaries but restricted from signing new players or increasing their cap cost in the current
season.
*Teams over the cap will pay a percentage of the difference between their payroll and
the cap to a fund which will be evenly distributed to all teams under the cap. This
percentage will be 10% the 1st season, 25% the second season, and 50% the third season.
*Any teams over the cap after the third season of this agreement will be subject to
punishment by the league up to and including voiding of contracts and loss of draft picks.
*The Gretzky Rule - One player can be designated as a Gretzky Rule Player so that his
contract does not count against the cap. This designation stays with the player for the
duration of his contract and all teams may only have one Gretzky Rule Player on their roster
at all times.
*Accurate financial reports for each team must be kept and turned over to the NHLPA after
each season. These reports are to be kept confidential and not released to the public.

[clintl]

Bring back the WHA!

[cartman]

Bring back the WHA!

I think this might have a bit of truth to it. Instead of contraction of marginal teams, this might be a golden opportunity for hockey to move to a European soccer style league structure. Have 4 leagues, with 16 teams in each league. Each season 4 teams move up, and 4 teams move down.

It gets teams in cities that would otherwise have to go through an expansion process, it gets more players in the NHLPA, it has a penalty for mismanaging a team (relegation) and rewards for running a team properly (promotion).

I've already made my feelings known about the salary cap in another thread. To me, a salary cap is the equivalent of getting your stomach stapled. You know what you need to do to lose weight (responsible budget), and that is eating less (stop splashing out enormous contracts). But to keep yourself from eating too much (big contracts), you staple your stomach (salary cap) instead of just eating less (spending wisely).

[Arles]

I think Cartman's anology has some merit. But my problem with not using a salary cap (and say rolling back salaries 24%) is that owners will always be trying to better their individual team without looking to the greater good of the league. Let's say that all the player's roll back their salaries 24%. Then, after the first season, a team like Colorado realizes they are one player away from a cup run and they go out and overspend for that one piece (a good RW). They realize that with that one piece they are in great shape for a run at the cup and have some extra cash because of the salary roll back. They end up winning the cup in the next year and the move pays off for them.

However, because of the deal they overpaid to the RW, a similar RW in Minnesota gets much more in arbritration because of the new benchmark. Now, Minnesota is pushed to a point where they must keep a player paid much more than he's worth. This cycle would continue until we are right back at square one with 75+% of the revenue going to players again.

The market gets set by the big salaries. And while some of the richer teams that sign players to these deals may actually come out OK, the effects to the smaller market teams (esp in arbitration) will always have them on the brink of solvency.

The best parallel I can think of for this would be a company like HP. Now, most people know that HP makes most of its money on printer cartridges from a margin standpoint. They do not, however, make much on the printers themselves. So, imagine the division that makes the printers is the Edmonton Oilers and the division that makes the cartridges is the Detroit Red Wings. Obviously, the cartridges are going to make more money for the company but HP also needs printer sales to help fuel the need to purchase new cartridges. Therefore, even though the printers aren't making much money, they can't afford to let the division go under and lose all that market share.

If you look at it from that point of view, it makes more sense to try and institute some type of revenue sharing system/salary cap to ensure all of the teams stay viable and competitive to keep the interest in each market (and potentially get a good TV deal at some point).

[Sharpieman]

I would watch the NHL if it changed some of the things on the ice. Make it more like International hockey first of all. Get rid of the stupid blue line and install a shootout instead of ties. No Americans want to see ties. It would also help out during the playoffs since games wouldn't last 5 hours.

[LloydLungs]

I would watch the NHL if it changed some of the things on the ice. Make it more like International hockey first of all. Get rid of the stupid blue line and install a shootout instead of ties. No Americans want to see ties. It would also help out during the playoffs since games wouldn't last 5 hours.

Whoaaa. I'm fine with breaking ties with shootouts during the regular season. I don't really care anyway because I only watch the playoffs. But shootouts in the playoffs? I LOVE those damn 5 hour sudden death games. You hit that third overtime and guys can barely stand up anymore but they're still going... not much in sports is more dramatic than those games... one of the primary reasons to love playoff hockey.

[Arles]

If you got rid of all the neutral zone clutching and grabbing, it's doubtful you would go more than one overtime to see a goal ;)

[Honolulu_Blue]

I've already made my feelings known about the salary cap in another thread. To me, a salary cap is the equivalent of getting your stomach stapled. You know what you need to do to lose weight (responsible budget), and that is eating less (stop splashing out enormous contracts). But to keep yourself from eating too much (big contracts), you staple your stomach (salary cap) instead of just eating less (spending wisely).
There's a one big problem with this analogy. In order for this to be apt, you would have to have 30 people (the owners) all trying to lose weight. They would have to agree that what they need to do lose weight (responsible budget), and that is they would have to agree to eat less (stop splashing out enormouse contracts). But the problem is that without getting their stomachs stapled (a salary cap as part of a CBA with the NHLPA), agreeing to keep from eating too much (big contracts) is highly illegal (collusion) and could result in serious fines if not criminal prosecution (see: Sherman Act Section I). Even if they do get their stomachs stapled, they still can't collude to pay players less. The cap just creates a legal barrier which the owners must abide.

[Tekneek]

I don't mind the elimination of teams, but I don't like the idea of contraction. If a team goes bankrupt, I have no problem with them going out of business.

How do you propose to resolve trades involving future draft picks and those teams?