Buccigross talks to former Whalers owner -- very incriminating stuff about Goodenow

[Accord]

This is a GREAT read, I only posted the first 2 Q&A's with former Hartford Whalers owner Richard Gordon, but there are a lot more so make sure you click on the link below to read the rest of them, they're on the second half of the page under the "The Great" section. http://sports.espn.go.com/nhl/columns/story?columnist=buccigross_john&id=1904436

No. 1: Who is lying and who is telling the truth?
Gordon: Many years I ago, I met Bob Goodenow. I said, "You know, Bob, things aren't going well. We're not making any money and we have no chance." He said that was tough. That if you go out someone else will take it. That's your problem. That's Bob Goodenow's attitude. And you know what? That's when I sold [the Whalers franchise]. Bob Goodenow couldn't care less about anything. There is no question the owners are bleeding. I gave them all my books for crying out loud. When Peter Karmanos, who I'm not a big fan of, says the Hurricanes will lose less money not playing he is absolutely telling the truth.

No. 2: Why did you buy the Whalers and why did you sell?
Gordon: I bought them because the league was stabilized, I like hockey, and I had an investment in downtown Hartford. There was a commonality of interest between players and owners. I sold them when I met Bob Goodenow. I was convinced he would destroy the league.

Click to read more...

 

[Bicycle Repairman]

How is this incriminating? Did Goodenow break the law?

Sounds to me like Gordon's got a case of sour grapes.

 

[Sotnos]

Read that this morning, very interesting interview.

Bob Goodenow couldn't care less about anything....I sold them when I met Bob Goodenow. I was convinced he would destroy the league.

I'd call that incriminating.

 

[HughJass*]

Funny point: Karmanos was on the radio last week and said this very interesting note: "when I bought the franchise, the previous owner told me 'now it's your turn to lose millions'". With a smile.

 

[shveik]

I have to asy this is very interesting. So many people appear alsmost clarivoyant, yet they allowed the league to get where it is right now. Goodenow says "if you go out, someone else will take it". Lo and behold, there is Karmanos. Then we have Gordon himself. Apparently he was losing money hand over fist even before the big rise in players salaries. And he was able to forecast the same fate for his successor. And for the league. Amazing stuff.

 

[YellHockey*]

I have to asy this is very interesting. So many people appear alsmost clarivoyant, yet they allowed the league to get where it is right now. Goodenow says "if you go out, someone else will take it". Lo and behold, there is Karmanos. Then we have Gordon himself. Apparently he was losing money hand over fist even before the big rise in players salaries. And he was able to forecast the same fate for his successor. And for the league. Amazing stuff.

How is it clarivoyant?

The owners have been singing the same tune since the NHL was formed. It's easy to predict the same old thing over and over.

I predict that Subway will continue selling sandwiches in the future and that people will still use the internet in the future.

If this is true ten years from now, does that make me clarivoyant?

 

[thinkwild]

That was a good article from Bucigross. The first half of the link, where he says dont blame the players. That half makes sense.

The 2nd half of that link, its hard to believe an ex owner/businessman actually wrote that. It looks more like something some kid wrote. What a crock of crap.

On Sept. 7, 1988, the NHL's board of governors approved the sale of the Hartford Whalers to Donald Conrad and Richard Gordon. Almost six years later, on June 28, 1994, Gordon sold the Whalers to Peter Karmanos for $47.5 million.

Now how much money did this complainer make on his investment? This WHA city that was absorbed into the NHL to eliminate competition. And like Aubut, he has the gall to complain he had to sell for enormous profit because Goodenow was ruining the league for the WHA cities which couldnt compete in the big leagues? What a kidder.

And so he showed the union his books. Gee, and he was losing money. What a surprise. And then gets offended because he's told its not an NHL market and will have to sell for big profit.

Like Anshutz, when owners are near bankruptcy, they are all of a sudden willing to show their books as representative of the league.

No. 4: Is there an economic scenario where the NHL could work in Hartford, Conn.?
Gordon: Only on a subsidized basis and if you knew what your costs were.

I love that one. Only if he's subsidized. Oh and knew what his costs were too. How about if the players just asked for whatever he could afford at the end of the year too. Sheesh!

The owners need certainty. They need to know what the hell their costs are going to be. They need to know how much salary they can allocate and how many players they are going to have, and then they can run a business. Hockey is perpetuating incompetence.

They need certainty? Come on, what owners dont know what their costs are going to be. THey can see how good their players are. Its not like someone goes into arbitration and they think he'll get $1mil but he gets $10mil. THey can see the paths their players are on. They and only they know how much they can allocate for salaries. They certainly know how many players they are going to have. Hockey is perpetutating incompetence? What does this even mean?

How has the union changed from the late '80s to today?
Gordon: There was a lot more trust. The players were happy and the owners were somewhat happy

Ha ha ha ha ha ha. I dont even know what to say about this one. Hes got to be kidding? This is an 8 yr old writing this right? It must be.

 

[shveik]

How is it clarivoyant?

Woot! I have managed to write something sarcastic without it appearig to be that way!

I apologize. Please see the post by thinkwild for a more coherent representation of essentially same view.

 

[LadyStanley]

They need certainty? Come on, what owners dont know what their costs are going to be. THey can see how good their players are. Its not like someone goes into arbitration and they think he'll get $1mil but he gets $10mil. THey can see the paths their players are on. They and only they know how much they can allocate for salaries. They certainly know how many players they are going to have. Hockey is perpetutating incompetence? What does this even mean?

Say you have player X making $1m this year. Is he an RFA? Earning below the league minimum? Per the old CBA he gets $1.1m qualifying offer. But let's say that X has arbitration rights. Sees that his numbers are as good as player Y who gets $5m. If he goes to arbitration, he might get $1m, $3m, $5m; depends on the arbitrator (and CBA rules WRT arbitration). Or maybe he thinks he's as good as player Z who gets $8m, so he'll holds out. (I'm not saying that X is a bad player or a good player; I'm not saying that he deserves a raise or a decrease or status quo. Just providing some fictional numbers and scenarios.)

But sitting back in April at the end of the regular season as an owner, you're trying to figure out with your GM and staff how much your salary costs are going to be next season (perhaps to decide if you'll raise ticket prices, parking fees, make trades at the draft, not re-sign, release RFAs, etc.). Most businesses call that a budget process. But you won't know until mid-August when arbitration awards are announced (or even much later if X holds out) what the costs will be.

Player X represents just one player the NHL team has under contract (of a max of 50/organization NHL one/two-way contracts including minor league and juniors) who might be changing salary in the upcoming season. So add together the variable of salary on each and every player.

The owners need/want "cost" certainty to know if/how they'll be able to break even or make a profit based on "known" income (STH, sponsorships) and "known" costs (travel to away games for N players and staff, staff salaries). Player costs are "undetermined" and there is no "logical" progression of salaries from one contract to the next for each player.

That's why they want it. (I never said it was a good reason. )

 

[thinkwild]

There is a very logical progression of salaries. And its becoming even clearer.

The players eligible for arbitration are restricted to negotiating with one team. If you have a $1mil player, that is comparing himself to $5mil or $8mil player, this is quite a situation. Can you think of one instance when this ever happened? I think its limited to the hypothetical. But say he did. ArE YOU saying he's not worth it. If Brendan Morrow scores 65 goals and 140pts, you thikn its unfair that he compares himself to Bertuzzi or Iginla. That becaus eof the irresponsible big markets in Montreal, Vancouver, and Calgary setting the salary bars for all the big arbitration eligibles, it is unfair for Morrow to get this money?

And you can be sure that every year, the owners by default are saying, can I raise ticket prices and by how much this year. Unless they are still trying to fill the building in which case they will discount a lot, same as lowering prices.

What are the big surprises in arbitration that throw an owners budget all out of whack and cause him to tear apart his team, or give him no options in team building? Bonus marks if you can do this without saying Doug Weight

 

[shveik]

The owners need/want "cost" certainty to know if/how they'll be able to break even or make a profit based on "known" income (STH, sponsorships) and "known" costs (travel to away games for N players and staff, staff salaries). Player costs are "undetermined" and there is no "logical" progression of salaries from one contract to the next for each player.

I am sorry, but this "cost certainty" BS that we hear from the owners is one of the reasons I tend to side with players in this dispute. All they need to do is tell their GM: ok, Tom (Dick, Gary), you can spend 30million on player salaries, and not a cent more. How is that for cost certainty?

I am of perhaps an old-fashioned school of thought that how much you have determines what you can get. If the owners really could not pay the money, they would not have. Nobody is forcing them to pay, so I am quite annoyed when they are whining about it.

 

[thinkwild]

And then Billy comes out and says the revenues are not very complicated. That he doesnt know what we can be questioning.

You know whats not very complicated? Not spending more than you can afford. Thats not very complicated. Revenues on the other hand are very complicated. And these owners have plenty of experience with that in their other businesses. They had a working committee with the players to try and determine that very difficult question - what are the revenues of a hockey team. IT was hotly debated and was a complicated question they couldnt agree on. So the owners disbanded the working group, hired Levitt, who said, no the owners way of doing it is right. Gee. What a surprise. Maybe they can question him about it. They could form a committee again and talk about it.

 

[LadyStanley]

I am sorry, but this "cost certainty" BS that we hear from the owners is one of the reasons I tend to side with players in this dispute. All they need to do is tell their GM: ok, Tom (Dick, Gary), you can spend 30million on player salaries, and not a cent more. How is that for cost certainty?

And there are some teams out there that actually stick to a budget.

Nobody is forcing them to pay, so I am quite annoyed when they are whining about it.

But if RFA player X, earning $1m this past year, dropped his offensive output by 50%, by the old CBA the owner is *forced* to make a qualifying offer of $1.1m to keep him on the team.

 

[myrocketsgotcracked]

But if RFA player X, earning $1m this past year, dropped his offensive output by 50%, by the old CBA the owner is *forced* to make a qualifying offer of $1.1m to keep him on the team.

isnt that what happened to anaheim last year with kariya? they decided hes no longer worth $10M/yr, so they dont renew his contract (making him a UFA), hoping he'll resign with at a lower salary. what happened? their (arguably) best player left town, sign with a conference rival, and the ducks went from a team that make the cup final to a team out of the playoff. sure, the owners arent 'forced' to make a qualifying offer, and in this case they certainly didnt, but look how successful they became.
if only more owners exercise this 'right' they have under the old CBA, we wont have any problem :.

 

[DuklaNation]

It isnt very complicated. The owners are caught in a spiral of spending more money to try to make more money and its not working. If your cumulative net loss is $50M, do you lose more in order to chop that net loss down or not? That is the question they face.

Some people need more business acumen. If Gordon bought the Whalers for $1, poured $100M into it, netted $20M for himself, he still loses $33M on the sale. Its not as simple as purchase price - sale price to get the difference.

Its not unlike buying a stock on its way down in order to lower your average cost in the hopes it will rebound. Instead, the losses increase. The smart man gets out and cuts his losses early.

 

[Guest]

I am sorry, but this "cost certainty" BS that we hear from the owners is one of the reasons I tend to side with players in this dispute. All they need to do is tell their GM: ok, Tom (Dick, Gary), you can spend 30million on player salaries, and not a cent more. How is that for cost certainty?

I am of perhaps an old-fashioned school of thought that how much you have determines what you can get. If the owners really could not pay the money, they would not have. Nobody is forcing them to pay, so I am quite annoyed when they are whining about it.

I agree with you, but if all teams are not created equal and some teams can spend 3-4x more on salaries than other teams, the best players -- who are paid the most -- end up on the same teams and you see a top heavy league. Then the bottom of the league is forced to spend it's money on lesser players and to scrap and claw to play the game. The end result is you see half of the league with the skilled players, and the other half of the league is full of young/unproven talent coupled with players who are clutching and grabbing to keep up with the skilled players. You might see the Nashville Predators compete with the Red Wings, and other compareables, but I'm sure many teams would rather trade in their current gameplan for one that included more talented players.

To me, it makes no sense to see teams spending so much with the diversity they do. It wreaks of a monopoly, which has already happened in other sports (see NY Yankee's). While the monopoly doesn't always win in sport, they are generally always in the hunt. They buy their place in line, while other teams are competiting for it.

Once again I am reminded of an expression I love, paraphrasing without credit it goes something like, "you are only as strong as your weakest link". Debate whether or not you want to eliminate the weakest links in the league, but you have to either give them more of a fighting chance, or remove them. The NHL wants to give all teams a chance, and the NHLPA is willing to remove them one might think.

 

[shveik]

I agree with you, but if all teams are not created equal and some teams can spend 3-4x more on salaries than other teams, the best players -- who are paid the most -- end up on the same teams and you see a top heavy league. Then the bottom of the league is forced to spend it's money on lesser players and to scrap and claw to play the game. The end result is you see half of the league with the skilled players, and the other half of the league is full of young/unproven talent coupled with players who are clutching and grabbing to keep up with the skilled players. You might see the Nashville Predators compete with the Red Wings, and other compareables, but I'm sure many teams would rather trade in their current gameplan for one that included more talented players.

Of course the teams in poorer markets would love to be on the same financial level as the big market teams. The question is, should they be subsidized in this way? And if so, who should be paying for it?

To me, it makes no sense to see teams spending so much with the diversity they do. It wreaks of a monopoly, which has already happened in other sports (see NY Yankee's). While the monopoly doesn't always win in sport, they are generally always in the hunt. They buy their place in line, while other teams are competiting for it.

Isn't it the case everywhere in life? Why should hockey be different? Plus, the rich teams now have two options: pocket the huge profit, or spend it trying to put competitive team on the market. With the cap they will only have only the first option. Which brings us to the next point.

Once again I am reminded of an expression I love, paraphrasing without credit it goes something like, "you are only as strong as your weakest link". Debate whether or not you want to eliminate the weakest links in the league, but you have to either give them more of a fighting chance, or remove them. The NHL wants to give all teams a chance, and the NHLPA is willing to remove them one might think.

The NHL want to give the poor markets a chance, but they want the players to pay for it. Look at it this way: there is certain amount of revenue generated by hockey. The owners want to cut the salaries to the levels of the poorest team in the league. Thus, the players are paid as if there are 30 poorest teams. The other way to do it is to eliminate or move the poorest teams into better markets. Yet another way is to have revenue sharing. But of course the owners are dead set on the solution where the players are in a way subsidizing the league existance in the poorest markets

 

[shveik]

isnt that what happened to anaheim last year with kariya? they decided hes no longer worth $10M/yr, so they dont renew his contract (making him a UFA), hoping he'll resign with at a lower salary. what happened? their (arguably) best player left town, sign with a conference rival, and the ducks went from a team that make the cup final to a team out of the playoff. sure, the owners arent 'forced' to make a qualifying offer, and in this case they certainly didnt, but look how successful they became.
if only more owners exercise this 'right' they have under the old CBA, we wont have any problem :.

Would not you say they are now paying for the mistake they made giving him $10mil salary in the first place?

 

[shveik]

And there are some teams out there that actually stick to a budget.



But if RFA player X, earning $1m this past year, dropped his offensive output by 50%, by the old CBA the owner is *forced* to make a qualifying offer of $1.1m to keep him on the team.

Why should they keep him if his production dropped so much? If he is not worth 1.1m to them, they should just let him go then.

 

[garry1221]

Why should they keep him if his production dropped so much? If he is not worth 1.1m to them, they should just let him go then.

maybe team b, say a rival, has a player whose production has dropped 60 or 75 %.. so they're obviously on a hunt for another player, what better way to screw your rival over by taking one of their young players and turning his game back around... if player x went on the open market without a qualifying offer team b says hey we'll help you get your game turned around, here's a 1.2 mil/year contract

do you let a rival get one of your young players just because of one bad season? i'd say no,

 

[Guest]

The NHL want to give the poor markets a chance, but they want the players to pay for it. Look at it this way: there is certain amount of revenue generated by hockey. The owners want to cut the salaries to the levels of the poorest team in the league. Thus, the players are paid as if there are 30 poorest teams. The other way to do it is to eliminate or move the poorest teams into better markets. Yet another way is to have revenue sharing. But of course the owners are dead set on the solution where the players are in a way subsidizing the league existance in the poorest markets

I agree with you on this, I've always been a fan of revenue sharing more than restricting the players. It doesn't necessarily mean that I side with the owners or that I want a cap because I think there is something wrong with the league as it is today. I think a cap of some form is the most likely solution because I don't see the owners giving in to revenue sharing on a big enough scale that it makes a difference. I think the owners will bully the players into making up for the mistakes the owners & GM's made, if the players are willing to take the fall. In general I look at it as a $180 million team versus $40 million worth of players on an individual basis, and the odds are in the owners favor because they have more control in my opinion.

Give me revenue sharing any day before you give me a cap, that is what a true cap would be. Allowing all teams to have equal profits, or near equal profits, allows them to spend near equally. Doesn't hurt the players association one bit either. Then again, if I'm making money on my team as an owner, you have to convince me that I should give my earnings to another team. Unless I can see the forest through the trees enough to know that I won't succeed and profit without the other teams in the league, it's a hard sell.

 

[joechip]

You know whats not very complicated? Not spending more than you can afford. Thats not very complicated. Revenues on the other hand are very complicated. And these owners have plenty of experience with that in their other businesses.

You know what's also not terribly complicated? Owners who are willing to spend non-hockey revenue to fund their hockey operations at the expense of their poorer-brethren. How does that factor into your budgeting equation? I know how I'd account for it... by selling my team and going into a business that didn't blow chunks.

Remember the Devils owner in 1994? A man who stated he didn't care a bit about the smaller-market teams? It's an issue that has to be dealt with. The stance that Bettman is taking is one that is trying to solve the real problem. Escalating player salaries is the symptom, deficit-spending ownerships are the disease. So, as Bucigross said in his article, I don't blame the players... yet. But, the union is being moronic in thinking that it can continue indefinately to feed on a corpse.

By tying salaries to league revenues and instituting some form of revenue sharing there is a greater chance for competitiveness from all 30 teams as there is a budgetary process in place that is more accurate than the current system. Teams will still be free to spend their money badly. *cough* Holik, Jagr, Yashin *cough*
They just won't be able to spend as much today without future reprecussions (luxury taxes).

Hradek's proposal is the closest one I've seen (and there are things in it that I disagree with) to a framework that rewards the league (both the players and the owners) for putting out a better-quality product year after year.

Ta,

 

[shveik]

maybe team b, say a rival, has a player whose production has dropped 60 or 75 %.. so they're obviously on a hunt for another player, what better way to screw your rival over by taking one of their young players and turning his game back around... if player x went on the open market without a qualifying offer team b says hey we'll help you get your game turned around, here's a 1.2 mil/year contract

do you let a rival get one of your young players just because of one bad season? i'd say no,

That's for the management to decide whether they will qualify the player with the hope of turning his game around, or to let him go. Otherwise, what are you paying your GM for?

 

[dawgbone]

That's for the management to decide whether they will qualify the player with the hope of turning his game around, or to let him go. Otherwise, what are you paying your GM for?

But don't you get it?

There will always be another team (most likely a Rangers, or Avalanche, or whoever), who will pay that player, as well as keep their own guy who struggled and is getting his automatic 10%.

That is the problem... not every team will let a player go for nothing if he has some value. They'd rather sign him to the extra 10%, than risk losing him to another team in case he does have a breakout year, simply because there are so few teams who do it, that there aren't enough players out there to replace the one you just let go.

It's not that simple to just say, here's my budget, I am sticking to it... not when your budget is 1/2 the size of some of the teams you are competing with.

 

[shveik]

But don't you get it?

There will always be another team (most likely a Rangers, or Avalanche, or whoever), who will pay that player, as well as keep their own guy who struggled and is getting his automatic 10%.

That is the problem... not every team will let a player go for nothing if he has some value. They'd rather sign him to the extra 10%, than risk losing him to another team in case he does have a breakout year, simply because there are so few teams who do it, that there aren't enough players out there to replace the one you just let go.

It's not that simple to just say, here's my budget, I am sticking to it... not when your budget is 1/2 the size of some of the teams you are competing with.

This kind of possessive attitude towards your "assets" is a sign of bad management IMO. The rich teams cannot just sign everybody due to roster limitations anyway, and normally they are limited to only signing the young players that are deemed disappointments by their original teams, and the UFAs.