Sharks still a have not- qualify for Revenue sharing

Discussion in 'The Business of Hockey' started by rekrul, Oct 24, 2006.

  1. rekrul

    rekrul Registered User

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    Sharks are considered among the NHL's financial have-nots, doing it by high player salaries and limited revenue money comming in. one of 11 teams that recieved $$ from the new agreement.

    http://www.mercurynews.com/mld/mercurynews/sports/hockey/nhl/san_jose_sharks/15833728.htm

     
  2. Irish Blues

    Irish Blues Still on hiatus

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    That was last year. The Sharks are *well* above the midpoint this year for salary cap purposes, so there won't be any revenue sharing for them in 2006-07.
     
  3. crashlanding

    crashlanding Registered User

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    Doesn't spending over the midpoint just disqualify you from the secong go-round in revenue sharing? The part that comes from escrow? If every team over the midpoint is disqualified, are Columbus, St. Louis, Washington, and Pittsburgh the only teams that will share that windfall?
     
  4. Irish Blues

    Irish Blues Still on hiatus

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    I'm going to have to read this carefully again ... I've seen this interpreted three ways.

    Back in a little while.
     
  5. burstgreen

    burstgreen Registered User

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    Eligibility for the "first round" of revenue sharing is defined by 49.3(b). It's defined in sort of a backwards way, providing three conditions that cause ineligibility, the inference being, that if you are not ineligible because of 49.3(b)(i), (ii), or (iii), then you are eligible.

    49.3(b)(i) is pretty easy to understand. They create a "master list" listing teams in order of revenue, with the highest revenue team on top. If you're on the top half of the list, you're ineligible.

    49.3(b)(ii) applies only to "big market" teams. This means that even if Chicago's revenues are skimpy, they are still ineligible because they are in a big city and it is the owners' own damn fault if he can't find a way to make money in Chicago.

    49.3(b)(iii) at first blush looks like some compensation-related requirement, but if you look at the defined terms "Available Team Player Compensation" and "Targeted Team Player Compensation" defined in 49.1, what this section does is say: targeted team player compensation is (more or less) the salary cap midpoint (this isn't exactly true, but this is a rough way to understand the general idea). If the players get 54% in a given year, then take your teams revenues and multiply it by 0.54, and then if that figure is greater than the league-wide compensation midpoint, then you're ineligible. Bottom line--49(b)(iii) has nothing to do with actual compensation or actual salary cap figure--the definitions tie back only to revenue.

    So the difference between (i) and (iii) is that (i) says you can't be above the median and (iii) says you can't be above the mean (aka average). Either being above the median or above the mean in revenues will disqualify the team. This means that actual player compensation (or cap figure for that matter) will not disqualify a team from "round one."

    The so-called "second round" of redistribution is set forth in 49.7, and this clause does explicitly disqualify teams from the second round if the team has "an Actual Club Salary" that is greater than the "Midpoint of the Payroll Range."
     
  6. USF Shark

    USF Shark Zôion politikòn

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    it's total BS. Last year Jamison told CNBC in an interview that the Sharks would make money, and that was after the trading deadline. Good accountants can make it look like your team is losing money in order to get more money from revenue sharing. Until they open up their books I won't believe a single thing any owner says about losing money.

    That CNBC video is on youtube: http://www.youtube.com/watch?v=3IVvs-I71hw
     
  7. ColoradoHockeyFan

    ColoradoHockeyFan Registered User

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    What kind of ratings did the Sharks average over the course of last season?
     
  8. Grizzly Adams

    Grizzly Adams Registered User

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    I don't think anybody should believe them.
     
  9. Falloooooon

    Falloooooon Registered User

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    I don't and you won't see me at the tank this season because I'm not going to support these clowns. I root for the players on the team, screw the rest of them.
     
  10. kdb209

    kdb209 Registered User

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    This matches my interpretation of 49.3(b)(i) and (ii) and 49.7, but is a bit off on 49.3(b)(iii).

    49.3(b)(i) is pretty straight forward - if you're in the upper half of teams in Regular Season and Pre Season (but explicitly NOT Post Season) revenues, you don't qualify.

    49.3(b)(ii) is the Screw You Wirtz Rule. The only teams with a DMA greater than 2.5M households (households, not population) are New York, LA, Chicago and Philly.
    PHP:
    Nielsen Media Research Local Universe Estimates* (US)

        *
    Estimates used throughout the 2005-2006 television season which starts on September 242005

         
        RANK     Designated Market Area 
    (DMA)     TV Homes     of US
        1     
    New York     7,375,530     6.692
        2     Los Angeles     5
    ,536,430     5.023
        3     Chicago     3
    ,430,790     3.113
        4     Philadelphia     2
    ,925,560     2.654
        5     Boston 
    (Manchester)     2,375,310     2.155
        6     San Francisco
    -Oak-San Jose     2,355,740     2.137
        7     Dallas
    -FtWorth     2,336,140     2.120
        8     Washington
    DC (Hagrstwn)     2,252,550     2.044
        9     Atlanta     2
    ,097,220     1.903
        10     Houston     1
    ,938,670     1.759
    49.3(b)(iii) is just a qualifier that makes the redistribution amounts greater than zero.

    "Available Team Player Compensation" is (approx) 54% of the teams Regular Season HRR.

    "Targeted Team Player Compensation" is just the revenue sharing target payroll (between midpoint-$4M and midpoint) plus the per team benefits (~$2.2M).

    The baseline revenue sharing distribution is "an amount equal to the difference between the Club's Available Team Player Compensation and the Targeted Team Player Compensation."

    If a teams "Available Team Player Compensation" exceeded its "Targeted Team Player Compensation" - as in the case of 49.3(b)(iii) - the revenue sharing distribution would be negative.
    The first round of Revenue Sharing is designed to bring the teams ability to pay up to the club's "Targeted Team Player Compensation" - between midpoint minus $4m and the midpoint. The leage gets to arbitrarily set the "Targeted Team Player Compensation" between those limits based on available revenues.

    The second round of Revenue Sharing - the "Escrow Funding Phase" - is designed to then bring the teams ability to pay up to the midpoint itself. It is this second round that has the exclusion for "Actual Club Salary" being above the midpoint.

    Actual Club Salary has no bearing on the first round of Revenue Sharing.

     
  11. 190Octane

    190Octane Registered User

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    So would the Ducks not qualify because they are in the LA tv market?
     
  12. rekrul

    rekrul Registered User

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    I can't find hard numbers but during the 2004 WCF run the sharks were on the Sac kings playoff games out drew the sharks in cable ratings. Sort of 2.8 to 2.2 share.

    Basicly they had to scrounge for radio these days and locally they are on a FM classic rock station- pregame ONLY if game starts after 7PM PST and a 15 postgame rap thats it. Having lived in the Bay Area for a while I have seen the sharks suffer for a number of reasons:

    1) Hockey is a tough sell anywhere
    2) Bay Area is a very soft sports market- really its 49ers/Giants and everyone else. Sure we have 2 sports stations but our market is like the 5th largest so it can support it. Warm weather= playing outside.
    3) Anything NOT San Francisco is second class in the media's mind. Especially a non-urban ( read un-hip ) suburban sprawl like San Jose.

    combined with the fact that the Arena has 65 Lux Suites where as the new ones today have around 100, infact they play now in 5th oldest Arena I think. They also lamment that they did not plan well enough to clear on parking, most is provided by the city ( and many are in free lots ).

    On the otherside I remember the original Gund deal with the city, which SVEE works on. Its a absurd $500K per year lease and the sharks, now SVEE, get EVERYTHING from the circus, to promis keepers to U2 concerts or other events. How they could qualify for revenue sharing is an awfully tricky numbers shanangians IMO.
     
  13. kdb209

    kdb209 Registered User

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    Correct. The Ducks are part of the Los Angeles DMA.

    It looks like the LA DMA includes all of Los Angeles, Orange, San Bernadino, Ventura, and Inyo Counties and parts of Riverside and Kern Counties.

    http://www.truckads.com/Affiliate/Los_Angeles.htm#map
     
  14. Falloooooon

    Falloooooon Registered User

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    I think the Sharks made a pretty good jump during last postseason in the TV ratings. I seem to remember an article which said they were in the area of 3.0, which is similar to what an Oakland A's regular season game on FSNBA gets.

    But they get almost zilch in the regular season.
     
  15. MLH

    MLH Registered User

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    So who exactly is eligible for revenue sharing money? Only four teams?
     
  16. kdb209

    kdb209 Registered User

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    According to the Murky News article, 11 teams (including San Jose) received revenue sharing money last year. It did not identify the teams.
     
  17. crashlanding

    crashlanding Registered User

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    That seems pretty standard for most teams. I know that's how NJ works, they're talking about the Mets or Yankees up until 7:30, then a 5 minute pre-game before the drop of the puck. Then if I go to the game the postgame is usually over by the time I get to my car. The only difference is the FM classic rock station, which could actually HELP ratings and reach people who wouldn't normally tune in for the five seconds after they get in the car and before they change the station.
     

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