What do we know for sure and what would be helpful to know more about?

Discussion in 'The Business of Hockey' started by eye, Nov 30, 2004.

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  1. eye

    eye Registered User

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    This board is filled with speculation of what we believe to be true. Our opinions differ but I thought maybe we could dedicate one thread to simple facts. Not that I think it will help resolve the dispute or sway anyone's opinion but it would be nice to deal with factual information rather than our own biased opinions.

    1. Can we agree that unlike other pro sports in N.A. the NHL is mostly a gate driven league? Has anyone taken the time to put together total attendence figures along with revenue derived from ticket and luxury box sales? Which teams own their buildings and which ones lease?

    2. Does anyone have a total list of operating expenses for a typical NHL team or all teams total for that matter? Bettman and Daley claim app.73% - 75% of all league revenue is paid out to player salaries alone. From another thread fromtherock posted "$77,856,100 is the highest team salary for the Detroit Red Wings. The lowest team salary belongs to the Nashville Predators at $21,932,500. The difference in the extremities is $55,923,600, 23 of the NHL teams do not even have a team salary over the difference in high-low. Players salaries totalled $1,332,014,890 last season, averaging $44,400,496 per team. 18/30 teams were under the average team salaries last season.

    I heard Richard Peddie of the Leafs yesterday say the Leafs/Raptors spend over 5 million a year just on arena maintenance. I would not have thought of that until I heard it.
    What about team travel for 60-80 days away from home, hotel, charter flights, per diem, player bonus money, signing bonus money, scouting staff travel and salaries, how many administrative staff on a typical team, arena lease or mortgage carrying costs, taxes, currency exchange, draft expenses for an entire teams staff, coaching staff, cars, gas, insurance for staff that get cars with their salaries, NHL execs-employee salary and office expenses, arena staff and security, on and on and on.

    3. Will the NHL still have the ability to generate 2.1 billion when this thing is settled?

    Answers to any other questions which might be helpful in supporting the NHL's stand or if anyone can actually tell me what exactly the principal is that players and the NHLPA stand for and why exactly they are so dead set against a cap that works relatively well in other sports please enlighten me. I have never really heard a reasonable explanation of what this principal is.

    NHL players seem to be paid similar to pro players in other major sports but the NHL doesn't have the TV revenue to support it's pay stucture and that's the biggest reason I tend to take the owners side on this, unless someone can provide facts to the contrary.
     
  2. As I pointed out in that thread started by fromtherock that the league is stating that 75% of revenue goes to player "costs" which actually includes things like Pensions, Medical/Dental Insurance, Life Insurance, etc. according to the Levitt report. These extra costs probably won't change significantly regardless of what system is in place. The actual percentage of salaries paid from revenue is actually closer to about 63% (based on the $2.1 billion in revenues) which is inline with the other major sports. What I find fault is that the league is using the 75% to justify a "salary" cap which only puts a limit on player salaries. But in reality, the league and the players aren't that far off. The league wants salaries to be 53% of revenue and the players have offered it be reduced to 58% (5% salary rollback). If the NHL can maintain a $2.1 billion industry (this lockout isn't helping that effort), then the league can support paying their players between 55% and 60% easily...if they can agree on how to get to that point (the arbitration system must be completely overhauled).
     
  3. eye

    eye Registered User

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    First off, did you have access to the Leavitt report to determine what is included as part of the NHL's 75% of stated costs for player payroll? Second, other leagues are reported to be around the 47-49% of gross revenue being spent on wages, hardly the 63% you indicate and do we know for certain if the 47-49% in other leagues includes pension, dental medical etc. or is this just payroll? It seems to me that leaving 25% of all left over gross revenue is not nearly enough to cover the listed expenses in my intial post which is only a partial list I might add plus the fact they must be operating their clubs at a very high tax rate. I just don't get it? It seems that players would be able to see that their pay is far too great of a % of gross revenue and an even higher % of net revenue. I don't get their stand on principal and I don't get why they are so against every form of cap that every other major sport now uses. IS EVERYONE ELSE IN PROFESSIONAL SPORTS STUPID WITH BOB GOODENOW BEING THE ONLY ONE THAT GETS IT? I HARDLY DOUBT IT. FACTS PLEASE.
     
  4. Eye, I must say that you've already crossed my annoyance threshold several times. And now you add full sentences in all caps. Great job.
    Do we have an ignore feature on this board?
     
  5. DaBo

    DaBo Registered User

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    The biggest question that need to be answered is.....What is reportable revenue?? If we don't know what revenue is, then we can't determine a % of revenue to go to salaries.

    Some teams own their arenas, some lease from others, some lease from themselves.

    When a team owns an arena, they will have more 'revenue' just because they have another way to make money.

    The teams that lease from themselves, set the $$$ amount, it could be $1 a year, or $1,000,000 a year. That would make a huge difference when reporting 'revenue', even when the bottom line on the entire entity wouldn't change. The team would look like it's losing money, but the ownership wouldn't be.
     
  6. Just an FYI, EVERYONE has access to see how the Levitt report came to determine what is included in part of the claimed 75% as part of Appendix D (or Schedule III). Revenues are defined in Appendix C (or Schedule II). But do the math on the numbers...take the total salaries and divide it by the $2.1 billion and what's the result (63.4%). I have no idea what other leagues have included in their percentage of costs. Really, it doesn't matter what other leagues do because there are significant differences to the NHL. What does matter is that the league is using total player costs to justify a salary cap which by definition only caps player salaries. This is probably why the players are against that cap on principal...because the league is using half-truths to make its case to the players. These half-truths and the league trying to guarantee the owners a profit (which is basically against the constitution of the league since its suppose to be a non-profit organization) is why I cannot be behind the owners in anyway.

    Here's the PDF version of the Levitt report: http://nhl.speedera.net/images/levittreport.pdf
     
  7. eye

    eye Registered User

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    Your easily annoyed. Perhaps you should seek help. If one sentence of CAPS upsets you so much then you might want to consider another career. Seriously, are you annoyed at me or just anyone that disagrees with your pro player pro NHLPA viewpoints?

    Common sense dictates that the NHL is broken and is in serious need of repair. I don't care how that evolved. I only want to see it fixed so we don't have to revisit this 4 years from now. Bettman is showing true leadership and wants an improved version of the NHL played under an economic system that makes sense.
     
  8. Sure the NHL is broken and in serious need of repair. But several parties should share in the blame including the players, owners, agents, Bettman, & Goodenow. Why don't you care how that evolved? They say those who forget history are doomed to repeat it. So knowing how it evolved can be very important to fixing the problem now and in the future. Maybe now with the insight that the owners have they can correct themselves without needing a cap. As someone else referred to in another thread, Rome wasn't built in a day. Getting the entire economic system fixed right now may just be not feasible. And even if you can fix the entire economic system right now, it may be useless if the revenues drop significantly because it took too long to fix the entire system (fans in the US barely notice that the league isn't operating...a new economic system won't change that). Bettman is just showing the same stubburness as Goodenow and both are just trying to be the winner in these negotiations and in the end, the only losers are the fans. And they are definitely on the cusp of losing more fans, including myself.
     
  9. BLONG7

    BLONG7 Registered User

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    I wish GB and Knob Goodenow were half as passionate as the posters on here about hockey...at least they would be negotiating and talking...meanwhile they are BOTH responsible for the season and the game going down the toilet! :banghead: :mad:
     
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