Only game being played is the blame game(CBA Negotiation discussion thread) - Part IV

[haveandare]

NHL lockout: Leafs-Wings Winter Classic could die in November

http://www.thestar.com/sports/leafs...fs-wings-winter-classic-could-die-in-november

I read this article this morning and kept wondering how this silliness is affecting the NHLs deals with the other corporations who are involved in this. For example, the WC involves HBO if they do 24/7, which seems like a tradition though I hadn't heard much about it yet this year, it involves the sponsors (Bridgestone I think was the biggest but I'm sure there are others), it involves NBC... do these companies get pissed? Do they have any leverage over the league at all? It seems so odd to me to think that Bettman is convincing these corporations to help him out one year and then is telling them "wait and see if we need your millions of dollars or not," this year.

 

[Dado]

Seeing as they are cancelling the preseason games like Hockeyville and Barclay's center-is it safe to say that all preseason games are done (including ones in Oct)-not just end of Sept?

Judging by the quality of talent already bolted for the KHL, I'd say the players have already bunkered down for the long haul.

At this point, I'd guess they've already told the owners that the Winter Classic is dead unless they come up with significant movement on what's on offer.

EDIT: Oh look, and here comes Bettman's too-late threat to cancel the WC...

EDIT: Neat, just found a live feed for Euro handball. This game kicks arse! And Sportsnet is streaming all of premiership champions league and euro cup for $20/month. And my "old country" has a team joining the KHL next season. We're slipping away, Bettman...

 

[Crows*]

I thought there was a 7-10 day segment that was so important here. How come that aren't ****ing negotiating !,?

 

[StaalForOne]

I thought there was a 7-10 day segment that was so important here. How come that aren't ****ing negotiating !,?

Apparently since they haven't actually missed any games yet it isn't important.

 

[Killion]

I read this article this morning and kept wondering how this silliness is affecting the NHLs deals with the other corporations who are involved in this. For example, the WC involves HBO if they do 24/7, which seems like a tradition though I hadn't heard much about it yet this year, it involves the sponsors (Bridgestone I think was the biggest but I'm sure there are others), it involves NBC... do these companies get pissed? Do they have any leverage over the league at all? It seems so odd to me to think that Bettman is convincing these corporations to help him out one year and then is telling them "wait and see if we need your millions of dollars or not," this year.

... its messy, no question about it, particularly so for NBC (not to mention CBC, Sportsnet, TSN etc) who will have pre-sold sponsorships & advertising, hired talking heads & analysts, play x play personnel, allocated crews & technicians, blocked out their scheduling, made elaborate plans for the WC, ASG etc, dropped $200M for the rights (which is paid in full up-front, the length of the Contract extended by a year in the event of a lost season). Then theres the NHL's league wide sponsors along with the individual teams local & regional sponsors, broadcast deals & their broadcasters sponsorship & advertising sales & logistical nightmares to consider. Without being privy to the terms & lengths of each sponsorship agreement, its hard to say what contingencies have been made.

There is no simple answer to your question. Needless to say, hundreds of millions on the line, tens of millions lost, some advertisers & sponsors simply moving on, investing in other sports or entertainment vehicles temporarily and in some cases, permanently if whatever they fill the void with exceeds their expectations. The NHL just recently announced a sponsorship deal with Pfizer (Advil) which would not only include broadcasting & arena components, but so too ancillary elements, point of sale campaigns, contests & sweepstakes, commercials produced, air time bought for regular cycles with ESPN, TSN etc. Associative programming if you will. Those campaigns would be largely unaffected, but the real meat & potatoes', live games, all that revenue pretty much gone.

 

[Fugu]

If you only count the direct effect of increase in the nominal exchance rate between USD and CAD, you're going to get miscalculations.

Before the 04-05 lock-out, teams like Oilers, Flames, Canucks and Senators were in the ropes. When CAD appreciated, the Canadian teams became stronger financially, they became more competitive and gained more fan & commercial money. So the indirect growth given by the CAD appreciation increased the total league revenues much more than just the change in exchange rate.

I.e. if Oilers got 1000 CADin revenues back in 04, that translated into ~700 USD. When the CAD made gains, that 1000 became 950USD. But because Oilers became more competitive financially, they got 1200 CAD in revenues which increased the revenues in USD more than 250.

The Oilers earn money in CAD. All their expenses, except players, is paid in CAD. They either save a lot of money when the CAD increases relative to the USD (to pay the players in US dollars); or they lose money when it goes in the other direction. They're much better off when the CAD appreciates relative to the USD.


For purposes of the cap, and the figures you see as reported as HRR, the total of all Canadian teams revenues is summed. Then the league uses ONE annual rate (avg from Jul 1- Jun 30, aka the League Year) to translate that to a US dollar value.

The teams actual spending in USD may be very different, depending on the market rate at the time they bought US dollars, and/or any other hedge instruments they may have used to mitigate risk on currency exchanges.

I don't really see how this NHLPA business in Alberta is helping any negotiations. If they lose, they just wasted time. If they win, well, the NHL will be pissed off that they wasted their time (and potentially 100million dollars in a lockout) and still not negotiate any differently than their crap offers. I doubt they're gonna go, Ok, we'll give you a better deal now that you've proven to arses.

You may be overlooking the fact that if the NHLPA wins, the two Alberta teams will have to pay their players in spite of a league-mandated lockout.

 

[therealdeal]

Not sure if this has been posted before, but for anyone who missed it, a really interesting read. Make sure to read all 3 parts.

http://nhlnumbers.com/2012/9/12/the-nhls-winners-and-losers-under-the-current-cba

 

[KopitarFAN]

I thought there was a 7-10 day segment that was so important here. How come that aren't ****ing negotiating !,?

Aren't both sides ****ing around with those hearing in a couple of provinces in canada?

 

[Gberg]

You may be overlooking the fact that if the NHLPA wins, the two Alberta teams will have to pay their players in spite of a league-mandated lockout.

I understand that full well, I'm just saying I doubt it'll make a difference when the two sides are negotiating.. except piss some people off.

I think a lot of teams/owners might've been spending right to the cap every year, even if they weren't making money. Rather than in the old days where you would trade players if you were broke, even getting money in return. These teams nowadays can keep their teams competitive (bringing in fans, or making playoff money), and then they can also cry poor that they aren't making any money during CBA talks.
I've got an idea... don't spend to the top of the cap!!!!

 

[BLONG7]

I thought there was a 7-10 day segment that was so important here. How come that aren't ****ing negotiating !,?

Fehr and Bettman have turned this into a joke...fire them already...

It's all posturing, but so disrespectful to the game, and fans...meanwhile the millionaire's all go to play in Europe for peanuts, just to cover their insurance...

 

[wetcoastwhale]

I am relatively unsophisticated in my understanding of the CBA impasse and accounting/business in general, and I haven't read everything posted, but would appreciate clarification.

Is the % of HRR a red herring? The reason the salary cap has increased dramatically since '05 is because of linkage to increased revenue, no? So, the NHL as a whole has made significantly more money the previous year compared to 02-03, for example. There aren't any major capital expenses that I can think of (perhaps the Oilers or Islanders needing a new arena in the near future) so is the league's stance essentially that their profitability hasn't grown as quickly as it could? Or, is the wage as 57% of HRR really unsustainable in the long run, even if revenues continue to grow?

 

[rdawg1234]

I am relatively unsophisticated in my understanding of the CBA impasse and accounting/business in general, and I haven't read everything posted, but would appreciate clarification.

Is the % of HRR a red herring? The reason the salary cap has increased dramatically since '05 is because of linkage to increased revenue, no? So, the NHL as a whole has made significantly more money the previous year compared to 02-03, for example. There aren't any major capital expenses that I can think of (perhaps the Oilers or Islanders needing a new arena in the near future) so is the league's stance essentially that their profitability hasn't grown as quickly as it could? Or, is the wage as 57% of HRR really unsustainable in the long run, even if revenues continue to grow?

There's a couple problems related to HRR % for the owners.

Revenues/profit has risen but mainly for the bigger, already profitable franchises. Yes the smaller ones got slightly healthier, but many still bounce between breaking even and losing profit on a yearly basis.(in general, around 10-15 teams are losing money, 5 or so being consistent, the others bouncing in and out.)

so as a whole, the league is in better shape, it just needs tweaks in order to improve the revenue for the lower end teams so that almost all teams are making at least a little bit of money.

as for the 57%, IMO at least, it is unsustainable with growth going the way it is, at 57% as opposed to 50% or so the owners will have to pay the players around another billion dollars over the next few years. So say over 6 years with decent growth, the players would get 12.5 billion at 57%, but around 11.5 billion at 50%. That's alot of money saved overtime that can be spread around the league.

The one thing the owners need to budge on(and I think they will) is revenue sharing, more revenue sharing coupled with the cut in % will create an extremely healthy league.

I dont think you can have one without the other though, more revenue sharing but no cut means more money comes from the owners, if the players take a bit of a hit, it means they split the bill for RS.

 

[Pepper]

The Oilers earn money in CAD. All their expenses, except players, is paid in CAD. They either save a lot of money when the CAD increases relative to the USD (to pay the players in US dollars); or they lose money when it goes in the other direction. They're much better off when the CAD appreciates relative to the USD.

League revenues are counted in USD. If Flames make 100M CAD in revenues, that was 60M USD in 2004. That same 100M CAD was 110M in USD back in 2009.

 

[PaPaDee]

I'm finding myself caring less and less as time goes on. Will I be disappointed if we miss the entire season? Yes, but I'm feeling quite content just watching AHL & Junior hockey where the players actually give a damn about the game.

 

[Nalens Oga]

I understand that full well, I'm just saying I doubt it'll make a difference when the two sides are negotiating.. except piss some people off.

I think a lot of teams/owners might've been spending right to the cap every year, even if they weren't making money. Rather than in the old days where you would trade players if you were broke, even getting money in return. These teams nowadays can keep their teams competitive (bringing in fans, or making playoff money), and then they can also cry poor that they aren't making any money during CBA talks.
I've got an idea... don't spend to the top of the cap!!!!

The point is to get the players of those two teams paid regardless of its usefulness in negotiation. I agree on the 2nd part, obv carolona shouldn't be dishing out huge contracts if their owner is so concerned about the team rarely being profitable. However the cap floor is also part of the problem and atm, neither side has discussed changing or eliminating it.

 

[Nalens Oga]

I was thinking about this earlier but does anyone else find it extremely weird that GM's like Burke are on the negotiating committee or even involved in these talks?

Also my suggestion for those guys would be to take the time to scout European leagues maybe rather than wasting it on negotiations (especially when the NHL's ideal CBA would probably extremely restrict GM decision-making).

 

[Ari91]

You may be overlooking the fact that if the NHLPA wins, the two Alberta teams will have to pay their players in spite of a league-mandated lockout.

I figured my question appropriately fits this train of thought - legally speaking, which holds more power, the contract itself or the CBA on which the contract is applied to? I know that players are made aware that their contracts are according to current CBA and any future CBA agreements can impact their existing contracts. I'm just curious whether you or anyone else knows which agreement holds more legal power in the courts. If a lockout is prevented in Alberta and Quebec, the teams can open their facilities to the players and allow them access to staff, etc. but can the absence of no CBA mean the players don't have to be paid because there is no CBA to tie their salaries to or does the contract itself take precedence?

 

[Dado]

...any future CBA agreements can impact their existing contracts.

They always have the right to walk away from any future agreements. Signing a contract "now" doesn't create an obligation for them to live under the modified contract "then".

 

[buggs]

http://www.theglobeandmail.com/sports/hockey/nhl-losing-the-war-on-social-media/article4558319/
NHL players’ use of Twitter has the league fighting an uphill PR battle in regards to the labor dispute.

That would be the author's opinion I suppose. I think the players would do well to stay away from twitter with all the strength they can muster.

 

[Boltsfan2029]

They always have the right to walk away from any future agreements. Signing a contract "now" doesn't create an obligation for them to live under the modified contract "then".

It does if they want to continue playing in the NHL. The SPC specifically says the player agrees to be bound by the terms of any future CBA.

 

[LadyStanley]

I think the players would do well to stay away from twitter with all the strength they can muster.

Why?

 

[Boltsfan2029]

Why?

Answering a question not directed to me...

Because the majority of the Tweets being sent out by the players seem to be (IMO) ill advised, are more like propaganda, and are on occasion downright arrogant and/or childish.

I was pretty much on the fence but the Tweets players have sent out have pushed me exactly the opposite from what the author of that article says - it's making me think less and less of the players and their position in this.

It was annoying me so much I "unfollowed" every NHL player, agent and media person I had on my list.

 

[Fugu]

League revenues are counted in USD. If Flames make 100M CAD in revenues, that was 60M USD in 2004. That same 100M CAD was 110M in USD back in 2009.

You're stating the obvious, but I have no idea what you're trying to argue any longer. I know how exchange rates work.

We've already established that 14% of the change in HRR for the term of this CBA was due to this type of currency translation you showed in your example. The reality is that the hypothetical Flames here had more than CA$ 100 MM in 2009. They probably grew at least 5-7% per annum, perhaps more. If the CAD declined in value, yes, you'd lose some portion of what looks like growth, but you wouldn't lose the actual increases seen in revenues due to real growth.

Let's say they grew to $120 MM by 2012. If the CAD fell to 0.8 (a traditional zone for a good part of the post-WWII era), the amount to be expressed in USD would be $96 MM (which would be a decline of only $4 MM vs 2004).

 

[CerebralGenesis]

All I know is that if we lose another full season, they won't be growing at 7% annually and I'll say that with high confidence. At least for the next few years

 

[Pepper]

We've already established that 14% of the change in HRR for the term of this CBA was due to this type of currency translation you showed in your example.

Have we established that 14% includes indirect effects to revenues, i.e Flames/Oilers becoming more competitive financially making them more competitive on the ice and thus getting more revenue from fans?