And what about NHL Reduction?

[patnyrnyg]

My comments were answering the question in the quote. The quote was quoting a reference to the player's say in the matter. I was pointing it out is not about maximizing revenues, at least from a player's perspective. It would obviously be less revenue, but then their share is split among less players.
Although, even that is short-sighted as we do not know if there would be any other repercussions. When Bettman took over, his goal was to get a national tv deal and reports were that at the time the big networks were hesitant as the NHL was clustered and large pockets of the country were without a team. So, for argument's sake if the Panthers and Lightning were contracted (don't hate me florida folk, just making an example), well, then you have a decent chunk of the US Southeast without a team. Florida, Georgia, Mississippi, Alabama, Louisiana, South Carolina. Would NBC affiliates in those areas want to carry NHL games? If you contracted the Stars, and Coyotes, the same thing but more south-central and southwest US. If local affiliates do not want games, is NBC willing to pay the same amount?

 

[KevFu]

I think the "Big TV deal" is one of the most commonly used arguments on this board, and the amount of people who scoff at how it played out as some kind of negative thing are way off base. (I'm not calling you among them, patnyrnrg)

Yes, the part of the "southern expansion" put forth by the NHL BOG and John Zeigler (pre-Bettman) was getting more of the US markets covered with teams to increase the TV deal.

And that worked. Everyone likes to look at the difference between NFL/MLB/NBA contracts and the NHL and point out how small it is, so the "big TV contract never materialized."

Sure, the NBA's TV contact is 5x bigger than the NHL's. But when the NHL announced a lot of expansion was coming back in the late 80s, the NBA's contract was 26x bigger than the NHLs.

It's like saying "The strategy didn't make the soft drink company as big as Coke," when it went from Tab sales to Dr. Pepper sales.

 

[Ted Hoffman]

This is where my comment comes in...

The league average of revenues (Forbes estimates, after RS, not exact) was $157 million. But slot the Average into the LIST and you get:

13 above average teams are a combined $509 million above average.
18 below average teams are a combined $536 million below average.

This is a problem. We want to eliminate the poor teams because they don’t bring in enough revenue to be successful. What’s the line for that? Cutting five teams to 26 gives us a marker: Who can afford the floor?

Our bottom five have to spend over 50% of their revenues to hit that salary floor. So that’s our indicator. You dip below 50% of revenue to hit the floor, and you're gone!

We cut those five teams (without increasing anyone’s revenues) and the new average is $167 million. That raises the floor to 62.5 million, which means two more teams are over the line, needing to spend over 50% to hit the floor.

So we cut those two. AVG up again, floor goes up. Another team falls below.
So we cut them. AVG goes up again, floor goes up. Two more teams dip below the threshold.
So we cut them. AVG goes up again floor goes up. Two more teams dip below the threshold.
So we cut them. AVG goes up again floor goes up. Four more teams dip below the threshold.

This would keep going until we hit 12 teams (9 American, 3 Canadian), if no one’s revenues went up. If revenues [sp] went up, you’d be cutting more teams and reach the point where the Rangers put the Canadiens out of business leaving TOR vs NYR. Of course, the rest of our countries would simply be hating hockey at this point.

Perfectly explained. This isn't Lake Wobegone, not every team can be "above average." As you start culling all the "below average" teams in some quest to get rid of all the underachievers, new ones eventually start becoming "below average" and get culled as well.

And this is a perfect way to explain how relocation makes once stable teams weak and requires they relocate as well, eventually causing a constant circle of relocation that makes the league increasingly unstable.

 

[MNNumbers]

Perfectly explained. This isn't Lake Wobegone, not every team can be "above average." As you start culling all the "below average" teams in some quest to get rid of all the underachievers, new ones eventually start becoming "below average" and get culled as well.

And this is a perfect way to explain how relocation makes once stable teams weak and requires they relocate as well, eventually causing a constant circle of relocation that makes the league increasingly unstable.

I agree IB, except in ONE particular case. In that case, let's say you have one team losing 30M a year. (Rev Redistribution helps, but for the sake of the example, let's ignore it). Let's say that the NEXT weakest team is losing 18M/yr. This is a huge gap.

Now, if you allow that ONE team, to relocate to a market where they lose 5M a year, that's a far more average situation. 5M/yr is probably made up in the rise of franchise values.

The result for the other teams is that league wide HRR goes up by about 25M/yr. Half goes to the players, so, that's 12.5M in expenses that the other teams have for players which they did not have before. That amounts to about 400K worse a situation on the bottom line for the other teams.

The bottom team is now losing 18.4M/yr. This is not a big difference.

What we don't know is how much each team loses now, and if the bottom has a gap like that. But, ONE single relocation in that manner - which would be, for example, Florida to Quebec, would NOT make a big deal.

And, that is why a few here can see the chance of something like that happening at some point - Not predicting anything mind you.

 

[KevFu]

I agree IB, except in ONE particular case. In that case, let's say you have one team losing 30M a year. (Rev Redistribution helps, but for the sake of the example, let's ignore it). Let's say that the NEXT weakest team is losing 18M/yr. This is a huge gap.

Now, if you allow that ONE team, to relocate to a market where they lose 5M a year, that's a far more average situation.

I think there's an important aspect of this where "if it doesn't make sense within the CBA to have a franchise making more money" the issue isn't with relocation, but the CBA.

But I don't think they're really LINKED. Like, our expansion/relocation decisions shouldn't be based on what happens to the midpoint and the rest of the league's overall health. Our CBA should be "what's best for the overall health" and this issue we're discussing has never been adequately addressed.

 

[MNNumbers]

I think there's an important aspect of this where "if it doesn't make sense within the CBA to have a franchise making more money" the issue isn't with relocation, but the CBA.

But I don't think they're really LINKED. Like, our expansion/relocation decisions shouldn't be based on what happens to the midpoint and the rest of the league's overall health. Our CBA should be "what's best for the overall health" and this issue we're discussing has never been adequately addressed.

Now this is an interesting idea, KevFu and I have been thinking of it myself. Here's the problem as I see it:

Since player salaries are linked to league wide HRR, and a large portion of the league wide HRR, and certainly also the rise from year to year in %age, comes from the top end, then that means that.....

The financial health of the bottom teams is DIRECTLY affected negatively if the high revenue teams really prosper. Consider, for example, a hypothetical situation where the following were true:
The last 4 teams in the East playoffs were Toronto, Montreal, Rangers and Philly
Last 4 teams in the West: Vancouver, Edmonton, Chicago and ???(Doesn't matter)
Let's say that the Final 4 were then: Vancouver, Chicago, Toronto and Rangers
Let's say that the SCF were Vancouver and Toronto and that most of these series went 6 or 7 games....
Now, THAT IS A WHOLE LOT OF MONEY.

What happens next year? Salary Floor goes up. That means that the bottom 10 struggle more.

If I am understanding you correctly, Kev, the idea is that is NOT really the effect you want.

Perhaps this is the sort of thing that Fehr wants for the next CBA....

Rather than complete cost certainty league wide, we need cost certainty on a local level. So, we do something like this:
We calculate a Cap Floor, like this, maybe....Midpoint established at LeagueWideHRR from last year*1.05*50%. (The 1.05 is for growth for the new year). Floor=80% of that. And, there is No Ceiling. Perhaps you institute some sort of Luxury tax, like so: Cap Ceiling is at Midpoint*1.20. Every % point above that is taxed at 2% more. So, if you spend Ceiling*1.01, you pay 2% of the 1% as a tax. Go over by 5%, and the tax is 2% for the first 1%, 4% for the 2nd 1%, etc. In this case, it would be a 5% average. The Luxury tax goes into revenue sharing in some way.

Probably that's what Fehr wants. Probably it's not what the owners want because they will have fan pressure ro spend.

But it would aleviate the problem you speak of.

 

[Ted Hoffman]

Perhaps this is the sort of thing that Fehr wants for the next CBA....

You don't even have to get into trying to describe it with numbers. Just call it exactly what it is: a luxury tax system. The underlying details aren't even important.

Fehr absolutely would love to dump the cap and go with a luxury tax system. The owners absolutely do not want that. Goodenow tried that in 2004; it didn't work then, it's not going over any better today.

 

[mouser]

Adding onto that, the collective NBA owners have been trying to do away with their luxury tax system the past couple CBA’s and move to a harder cap—the majority of owners don’t like it.

Getting rid of the luxury tax system hasn’t happened yet, but the luxury penalties have been increasing and increasing with each NBA CBA.

 

[Oddbob]

Great idea, let’s start with your favourite team.

Oh look, someone worried about markets that don't like hockey! Arizona and Florida at the forefront!

 

[Oddbob]

OK, so start by contracting the Bruins since you want to improve things for the fans.

Bruins would be among the last to go, since you know, their fans both like and support their team.

 

[Oddbob]

Expanding population in Canada & the US... check
Expanding economies in Canada & the US... check
Pipeline for NHL-level talent from Europe to come over... check

Yep, looks like the time to start contracting. Let's start with the Maple Leafs & Rangers.

What an asinine post!

 

[Oddbob]

I love how talent dilution is still an argument after an expansion team made it to the SCF IN THEIR FIRST YEAR.

That doesn't mean there isn't talent dilution! It means the league is so watered down, that even an expansion team can make the finals! Right now, there are maybe 5 legit Stanley Cup threats (if even that many), and 20 hope that they can just make the playoffs. Contract the teams that don't like hockey enough to support it, and the number of threats goes up, not down. And except for flukey years, you almost are guaranteed no expansion team comes close to the finals. I mean look at Florida games! Even with vacationing fans of other teams coming to their games, their arena is quite empty whenever you see their rink during games.

This idiotic thought of saying, do you want a 6 team NHL just because you support contraction is lame. As is the people posting things like, ok cut your team first then, when it is directed at fans of teams who would legit be last in a line of teams cut. We aren't asking for a 6 team NHL, but maybe cut 6-10 teams, so the rest of the teams have much more talent, and the arenas might actually be full or much closer to full. To the fans of those teams, it sucks, certainly, but that is life. I don't have a team in my area, and I still watch and cheer for a team, so if they like hockey they can do the same thing. Doesn't prevent you from liking the game one iota.

 

[kaiser matias]

Bruins would be among the last to go, since you know, their fans both like and support their team.

Which is why they'd never have to resort to things like free ticket giveaways right?

No team is exempt from issues.

 

[Oddbob]

Which is why they'd never have to resort to things like free ticket giveaways right?

No team is exempt from issues.

This is simply called marketing, not them being in financial trouble! The thing you provided also says you have to purchase 4 tickets first, so they aren't free until money is spent. Florida used to give free tickets away, just to hit 15,000 in attendance to inflate their attendance numbers.

All teams are going to have marketing strategies to bring in fans, so your massive pic means not much.

 

[the4thlinegrinder]

Oh look, someone worried about markets that don't like hockey! Arizona and Florida at the forefront!

My comment had more to do with how easy it is to talk about folding/contracting teams, and that nobody wants their team gone. It’s always somebody else’s team. How brave.

 

[patnyrnyg]

Bruins would be among the last to go, since you know, their fans both like and support their team.

It was in response to a Bruins fan recommending contraction. Secondly, Boston is a VERY fair-weather town from I have seen.

 

[zetajerk]

Oh look, someone worried about markets that don't like hockey! Arizona and Florida at the forefront!

Oh look, it's insecure northerner #8973421085425

You should be more worried about another dead wings era oncoming.

 

[BigBadBruins7708]

It was in response to a Bruins fan recommending contraction. Secondly, Boston is a VERY fair-weather town from I have seen.

then you clearly havent seen anything.

the only time there were attendance issues were in the early 2000s because the fans had finally had enough of Jacob's being cheap. They stopped going to games to send a message that the team needed to change.

Also, the league is too big...period.

The talent is too spread out which is causing the boring hockey we get today.

The even spread of talent has let coaches and systems have more effect and take over. It has also led to teams focusing on defense because the scoring isnt guaranteed.

People pine for the excitement of the 80s and early 90s, but fail to realize the reason that was so great was because the league was loaded. You had 3rd lines as good as some 1st lines today.

The league has expanded so that the owners can cash and pocket the expansion fees. But it has diluted their talent, and saddled the league with deadweight teams

 

[zetajerk]

then you clearly havent seen anything.

the only time there were attendance issues were in the early 2000s because the fans had finally had enough of Jacob's being cheap. They stopped going to games to send a message that the team needed to change.

Also, the league is too big...period.

The talent is too spread out which is causing the boring hockey we get today.

The even spread of talent has let coaches and systems have more effect and take over. It has also led to teams focusing on defense because the scoring isnt guaranteed.

People pine for the excitement of the 80s and early 90s, but fail to realize the reason that was so great was because the league was loaded. You had 3rd lines as good as some 1st lines today.

The league has expanded so that the owners can cash and pocket the expansion fees. But it has diluted their talent, and saddled the league with deadweight teams

Or the team stunk and people didn't feel like going and made better use of their time and money. It's ok to do that, you know, no one will judge you as long as you're not in the south.

 

[decma]

I think the "Big TV deal" is one of the most commonly used arguments on this board, and the amount of people who scoff at how it played out as some kind of negative thing are way off base. (I'm not calling you among them, patnyrnrg)

Yes, the part of the "southern expansion" put forth by the NHL BOG and John Zeigler (pre-Bettman) was getting more of the US markets covered with teams to increase the TV deal.

And that worked. Everyone likes to look at the difference between NFL/MLB/NBA contracts and the NHL and point out how small it is, so the "big TV contract never materialized."

Sure, the NBA's TV contact is 5x bigger than the NHL's. But when the NHL announced a lot of expansion was coming back in the late 80s, the NBA's contract was 26x bigger than the NHLs.

It was only 26x as big for one season - 1991/92.
And it was only 2.5 to 5 times as big in the mid to late 80s, before NBA rights really took off.

The ratio is going to depend on a lot of factors other than national footprint - when the last contract was signed, the Jordan effect, etc.

E.g., in 1988/89 and 1989/90 the NBA's national US TV rights fee were only 2.5x as big as the NHL's. These were the last two years of the NBA deal with CBS ($43.25 million/season), and the NHL was getting $17 million/year.

In 16/17 , 17/18, and 18/19, with the new NBA deal, the NBA U.S. TV rights fees are 13.5x as big as the NHL's. ($2.7 billion vs. $200 million).

Here is the ratio by season (data taken from a variety of sources, including Sports Business Daily and wikipedia). Is there strong evidence that southern expansion reduced the disparity?


1973/74 3.86
1974/75 3.86
1975-83 NA
1983/84 5.75
1984/85 5.75
1985/86 2.87
1986/87 5.41
1987/88 5.41
1988/89 2.54
1989/90 2.54
1990/91 8.84
1991/92 27.32
1992/93 10.02
1993/94 10.73
1994/95 4.96
1995/96 4.96
1996/97 4.96
1997/98 4.96
1998/99 8.98
1999/00 3.37
2000/01 3.37
2001/02 3.37
2002/03 6.38
2003/04 6.38
2004/05 NA
2005/06 11.07
2006/07 11.07
2007/08 13.44
2008/09 12.00
2009/10 12.00
2010/11 12.00
2011/12 4.65
2012/13 4.65
2013/14 4.65
2014/15 4.65
2015/16 4.65
2016/17 13.50
2017/18 13.50
2018/19 13.50

 

[patnyrnyg]

then you clearly havent seen anything.

the only time there were attendance issues were in the early 2000s because the fans had finally had enough of Jacob's being cheap. They stopped going to games to send a message that the team needed to change.

Also, the league is too big...period.

The talent is too spread out which is causing the boring hockey we get today.

The even spread of talent has let coaches and systems have more effect and take over. It has also led to teams focusing on defense because the scoring isnt guaranteed.

People pine for the excitement of the 80s and early 90s, but fail to realize the reason that was so great was because the league was loaded. You had 3rd lines as good as some 1st lines today.

The league has expanded so that the owners can cash and pocket the expansion fees. But it has diluted their talent, and saddled the league with deadweight teams

So, when the team was bad, fans disappeared? I was in Boston in March of 2007. Was staying down the street from the arena. Celtics had a game. Asked guy at the front desk if he thought tickets were available? He said, "For the Celtics? You have sneakers? They might let you play." Patriots? How were they supported pre-Parcells? Let's see what happens Post-Belicheck/Brady.

As far as the rest, that talent pool is NOT diluted. In the 80s the Russians weren't playing in the NHL, only a handful of Czechs and Slovaks. Even Sweden and Finland were not well represented. Hell, the US didn't have many NHL'ers. Now, they have a much larger pool from which to draw.

 

[Gnashville]

Bruins would be among the last to go, since you know, their fans both like and support their team.

Ok then Detroit and Chicago since they have multiple Cup winners to sell out

 

[Oddbob]

Ok then Detroit and Chicago since they have multiple Cup winners to sell out

Detroit and Chicago would be at the top of the list as well of teams not going anywhere if contraction was a thing. Florida, Arizona, Carolina would be 3 near the top, not that hard to understand that it would be teams that aren't huge into hockey.

To the other poster with the insecure northerner comment! What does that even mean? If the southern teams liked hockey than I have no issue with them having a team, they clearly however do not. And nice try with the Dead Wings comment. Even with that bad stretch we are still more successful during the expansion era than any of the expansion teams!

Also Detroit sucks right now, has major financial issues and the arena is still pretty full with us not playing exciting hockey right now!

 

[sonofsamson]

Detroit and Chicago would be at the top of the list as well of teams not going anywhere if contraction was a thing. Florida, Arizona, Carolina would be 3 near the top, not that hard to understand that it would be teams that aren't huge into hockey.

To the other poster with the insecure northerner comment! What does that even mean? If the southern teams liked hockey than I have no issue with them having a team, they clearly however do not. And nice try with the Dead Wings comment. Even with that bad stretch we are still more successful during the expansion era than any of the expansion teams!

Also Detroit sucks right now, has major financial issues and the arena is still pretty full with us not playing exciting hockey right now!

Overall, you are probably correct! about those three teams being ripe for contraction! if it were a thing but going on a message board and vaguely ripping a whole region for "clearly not liking hockey" will get people riled up!

 

[BigBadBruins7708]

Overall, you are probably correct! about those three teams being ripe for contraction! if it were a thing but going on a message board and vaguely ripping a whole region for "clearly not liking hockey" will get people riled up!

truth hurts

it isnt exactly a put down either. Different regions prefer different sports.