Hey, don’t knock the Igloo!
As for return on investment, Neurotik, I take your point but your business math isn’t too good. Going from $70M in 1998 to $104M in 2005 isn’t a 48% return on investment. Assuming my quick and dirty spreadsheet is corrrect, such growth reflects approximately a 5.8% annual return on the investment.
Millionaire players squabling with billionaire owners. If the NHL never has another season, it is no loss.
Let the Thunderwolves play for the Stanley Cup.
Yep, we don’t have anything else to talk about, because it is apparently your fundamental belief that owners are in it for their employees and have no right to enrich themselves after taking risks with their money.
Marx himself would be proud of you.
I’ll happily concede my math sucks, and welcome any corrections, but I didn’t mean an annual return on investment, I meant a total return. Although, I guess annual return is the smarter way to go about it.
:rolleyes: Did you read my post?
My fundamental belief can in no way shape or form be construed to say that owners are in it for their employees. As I pointed out before, I have no problem with the owners trying to break the union and institute a salary cap. More power to 'em if they can do it. I simply pointed out that the players have no obligation to roll over for the owners. There’s no season because the owners refused to budge from their position, while the players were willing to negotiate. That there has been no hockey season must be laid completely at the feet of the owners.
I’d be surprised at the difficulty you’re having with my position, if you hadn’t consistently demonstrated poor reading comprehension and an inability to grasp nuance in the past.
Ah, I see. Another “nuanced” position. Where’s the nuance this time? :rolleyes:
I saw a simple, declarative sentence. Therefore, am I to assume that anything that doesn’t appear in the Constitution is not a right? Oh, that’s the nuance. You’re being clever, so that when I comment you can tell me how dumb I am. Gotcha.
But RickJay, what about San Jose :)? They sit at least squarely in the middle in valuation:
http://www.forbes.com/free_forbes/2003/1208/nhl_16.html
Why, eactly, did they put teams in places where most people have to visit a crappy place named the “Ice-arium” to skate, anyway?
Airman, the owners don’t have a right to a profit. Nowhere in business is a profit guaranteed. Not even in professional sports. That’s what you seem to be missing.
If the owners wanted to increase profits by controlling salaries then they’ve had quite a few chances and passed on all of them. Any time the CBA came up for renegotiation, they passed. Every time a player became a free agent, an owner was willing to overpay him.
I’m pissed that there isn’t going to be a season. Hockey is about the only sport that I really follow. I like football, but man do I love some hockey. I spent 6 years in Dallas and I went to zero Cowboys games. During the same period I went to tons of Stars games.
I blame the players. I also blame the public for liking NASCAR and baseball instead of hockey. Stupid ass people. Watch a sport that requires actual athleticism and talent instead of the ability to turn left or stand in a field waiting for a ball to be hit to you.
Bah. 
RickJay -
What’s your proposal for adjusting salaries for American dollars vs. Canadian dollars, and the US income tax system vs. the Canadian tax system? It is my understanding that these disparities drive quite a few players to the US. The players would rather play in Tampa Bay, which has no state income tax, vis a vis Toronto or Winnipeg.
The problem in all sports is that the teams are competing with each other, butnot economically. That is where the usual anology of comparing hockey and the like ot other inductries fails. The Rangers gain nothing by forcing out of business their competitors. IN fact, they need their competitors. But a free market solution, which in other industries encourages a sort of Darwinian suvival, is not conducive to sport. The owners don’t have to pay? True enough, but it really only takes a couple of owners to skew the whole marketplace and suddenly teams are left uncompetitive, which is fine for the auto industry, but not so much for sports leagues. Their product is competition an the irony is that economic competition is probably the antithesis to athletic competition.
Answers to Ellis Dee and zamboniracer:
You’re referring to the Ottawa Senators. And you’ve got a major logical problem there; if the Ottawa Senators are in trouble because they can’t afford their salaries, how in the name of God’s left nut will a $40 million salary cap help them? The Senators have NEVER spent $40 million a season on salaries.
The Senators going bankrupt is a perfect example, actually, because it had nothing to do with player salaries; they would have been losing money even had the players played for free. The Senators went bankrupt because they could not even come close to servicing their startup debt; the team has made a healthy operating margin every year it’s existed. But the NHL gave the franchise to a new owner that did not, strictly speaking, have any money; the first owner, Bruce Firestone, had to borrow almost every penny. He didn’t even have the expansion fee. And then they allowed him to “sell” the team to another owner (Rod Bryden) that did not actually have any money - in fact, Bryden had already lost almost all his money years before on bad investments. He simply had no money at all; it was preposterous that the NHL allowed the man to buy a franchise. By 2002 the team was $375 million in debt, almost all of it startup costs; the franchise fee, the stadium, and the costs of starting the team. The Senators were created from scratch, and run for ten straight years, on pure borrowed money. They built a stadium in the middle of nowhere, paid $35 million for a highway exit in the middle of nowhere, and started the entire team, from soup to nuts, on what basically amounted to smoke and mirrors. When the team was finally bought by someone who had some money, and who could actually pay off the initial investment to have an NHL team, it suddenly started seeing black.
The Ottawa Senators are a picture perfect example of the stupidity of the NHL; they gave a franchise to a guy who couldn’t even pay the expansion fee. What can you possibly expect if the NHL doesn’t even do due diligence to ensure that new franchises have the financial backing to survive just starting the team? Think about how fucking dumb that is:
1990
NHL: Ottawa looks like a good place to run a team. It’ll cost you $50 million up front.
FIRESTONE: I don’t have $50 million.
NHL: Can you put it on your Visa?
FIRESTONE: Sure!
NHL: Great! Got a stadium?
FIRESTONE: Not really.
NHL: Can you put it on your Visa?
FIRESTONE: Uhhh, maybe if they increase my limit!
NHL: Great!
1993:
FIRESTONE: I can’t pay my Visa bill. I need to sell the team. I have this guy lined up, his name is Rod Bryden.
NHL: Hi Rod! Do you have some money?
BRYDEN: No, but I can put it on my Mastercard!
NHL: Great!
2000:
BRYDEN: I can’t pay my Mastercard bill.
NHL: Can you pay it off your American Express card?
BRYDEN: Amex had my card cut up into little peices.
NHL: Maybe you can convince the government to give you money!
BRYDEN: They spit at me.
NHL: Oh no! How could this possibly have happened?
Anyone could see the team would be in perpetual financial trouble even if they packed the house every night. The Senators’ woes had nothing to do with the NHL’s salary structure. Absolutely nothing.
So why do players want to play in places like New York City and Boston? Income tax load in New York or Massachusetts is just as high as Ontario, and close to Quebec or British Columbia… and much higher than Florida. If the Panthers and Lightning are drawing more free agents than the Rangers and Bruins, I must have missed that. The only really large Canadian market, the Maple Leafs, seem to have no problem at all convincing big name free agents to sign there.
It’s beyond the NHL’s ability to equalize income tax levels in all states and provinces. Life sucks, get a helmet.
As to the issue of the different currencies… sigh. It just does not matter. Never has and never will. Currency and money are two different things. The Canadian dollar being worth about 4/5ths of an American dollar is accounted for by the fact that Canadian consumer prices are generally about 20% more Canadian dollars. Paying someone $6 million CDN and paying him $5 million US is not different. They are the same amounts of money.
Currency exchange can have a shocking effect if it changes rapidly - but that could be to the benefit of Canadian teams just as easily as it could be to their detriment. As it was in the 2003-2004 season.
The disadvantage that Calgary, Edmonton and Ottawa in particular have is that they are very small markets, all about a million people. The Toronto market is larger than all three combined, quite a bit larger. That inequality isn’t going away, those franchises just have to play smarter. But I’m wagering that Edmonton will always be a better hockey market than Phoenix.
Tamerlane, I somehow forgot San Jose. Great hockey town. I think I have no choice but to go to 20 teams.
Welll, I admit, it’s not very nuanced in the wide world of nuance - but it’s a hell of a lot more nuanced than “It’s the players fault and anyone who disagrees with me that it’s the players jobs to look after the profits of the owners is a dirty communist” - which is the position you seem to have taken.
Perhaps you should have kept reading. Then you would have understood that I believe owners have a right to try and make a profit, just as the players have a right to decide what conditions they’re going to work under.
I know, I know. Reading beyond the first sentence in order to grasp an entire argument is sooo much more difficult, but hey, that’s life.
Actually, the position I’ve staked out is much easier to grasp than that. The owners screwed themselves, they decided that to unscrew themselves they had to find a way to control spending money they couldn’t afford, and the players were on the hit list. It’s an unfortunate position that they put themselves in, but that’s what they chose to do.
The players are at fault because they refused to adjust to the changed reality. The owners were not going to give in. You can call them assholes if you like, but I call them employers. Example: if the airlines decide that they have to have concessions to survive, they get them. The employees adapt to the new reality.
The players may very well have priced themselves out of a job. If the NHL dies they’ll get 100% of nothing. The salaries will never, ever see the heights that they were at, and for some reason they tried to deny that fact. They signed on to a suicide pact. That’s another thing I’ve never understood about unions: when the opposing party refuses to negotiate, unions cannot win. So it becomes the labor version of Jonestown. They just keep drinking the Kool-Aid until they die rather than getting 50% of something.
The owners never blinked. The union better blink really hard before they end up representing themselves to death.
Were I an owner, I would expect a certain return on my investment, or else I wouldn’t invest. The owners have changed the rules to reflect this new reality. They should have done this in 1994, then they wouldn’t be in this position. I’m certainly not crying over a millionaire playing a kid’s game, and to tell you the truth I’m not crying over the billionaire owners, either. I’m looking at it from a business perspective. The owner has a right to expect a return on his investment. If his employees are making more than he is something is wrong. It’s that simple.
In a strange way, it may be Wayne Gretzky who is responsible for killing the NHL.
What happened was that when Gretzky went to LA in the early 1990’s, he stimulated a boom in interest in hockey in the U.S. The NHL started to get network TV contracts, and the league fooled itself into thinking that it had ‘broken through’ and was about to become another major sports league like baseball or basketball. In that atmosphere, in 1994 the players negotiated a contract that was wildly in their favor. Then the TV audience ccollapsed, and the league started hemorrhaging money. The players in the NHL take a higher percentage of league income than do players in any other major sports league. And by a good margin, as I recall.
I think what has happened here is that the owners have decided that they don’t just need some rollbacks here and there, but they need to revamp the entire way in which the players are hired, either with salary caps, or ties of salaries to revenues, or something else. The players are on the other end, still maintaining unrealistic expectations of income.
If the two sides can’t meet in the middle, the union might break or the league could even collapse and start losing teams. The problem is, the current gap is pretty wide.
I heard Grant Fuhr on the radio this morning, and he says the players bear most of the fault. The last offer on the table was a cap of, I think, 45%, but the players wanted 49% and refused to budge. So the season’s over. As Fuhr pointed out, the loss of a season is going to hurt revenues next year, no doubt. So if they get their 49% next year, it might be 49% of a much smaller pie. Both sides lose.
Sam, the offer was $42.5 million US straight up, not a percentage; the players’ counteroffer was $49 million. Both assume a onetime rollback of 24% on all salaries.
The “revenue linked to payroll” thing was dropped.
Wayne Gretzky joined the Kings in 1989.
I would agree that the surge-and-collapse of hockey interest did have something to do with this mess, but it’s also true that the NHL became addicted to expansion fees. They’ve been running the pro sports equivalent of an Amway pyramid, with the existing teams surviving on the blood of new recruits. Even after the bloom was obviously off the rose, they added Atlanta, Nashville, Minnesota and Columbus, and that was after adding five new teams in seven previous years. In total, nine teams were added in just ten years, increasing the size of the league by almost fifty percent. No other major sports league has ever expanded so fast.
It’s true that the NHL pays players far, far more as a percentage of league revenues than the other sports, but you have to ask why that is. Baseball has no salary cap, either, but baseball salaries are a much lower percentage of team revenue. I blame the quality of play and overexpansion:
The effect of hyperexpansion was;
It’s a revenue problem, plain and simple. The quality of play sucks. Teams are in places nobody cares about hockey. If you ran a pro football league in India with high school players would you expect to make millions?
I would like to note for the backers of the owners here, that the rollback offer came from the players.
I’d also note that of all the posters in this thread, including me, RickJay is making more sense than any three of the rest of us put together.
So, the solution is obvious. Fire Bettman. Name RickJay commissioner of the NHL.
Close, fire Bettman and Goodenow. Right now I’ve just about had it with both of them. :mad: