Discussion in 'Fugu's Business of Hockey Forum' started by ummerr, Feb 7, 2011.
Pure speculation, but what do you think the salary cap will be in 2015? 2020?
It depends on what happens with the NBA and/or NFL next year. With the new TV contract, if the NHL becomes the only game in town, I could see the game going up 4-5M in one offseason. There are a lot of variables, and if it does go up that fast, revenues better be maintained or it will fall just as fast.
if revenues continue to climb at it's current rate then add 2-3 million per season.....
how ever there will need to be a new CBA before then.... so... who knows
Impossible to say, but i doubt after next season the CBA will be the same.
The floor will need adjusting, which will cause a ripple effect.
Big money teams will demand more flexibility at the top if the bottom is given more options to save monies and receive hand outs.
I'm just wondering...as if it goes up significantly, a lot of these long terms signings won't be as huge cap hits (relatively) if the cap is say $80 million in 2015-2020. Ie, Ovechkin/Lecavalier.
That's what these teams were banking on when they signed them.
I think it's going to be interesting to see if a guy like Pronger gets traded to one of the poorer teams in the league when he hits 40 and has that massive cap hit, but low actual salary. His cap hit will be $5 million, but his salary will be $525k. He then retires before ever playing a single game, but his cap hit remains because he's an overager.
Everyone complains that teams at the top are getting around the cap with these deals, but in a few years I suspect these contracts will also be abused by the poorer teams to reach the salary cap floor while spending potentially tens of millions less than the floor.
I think this whole concept is overblown. If the salary cap/floor increases to a point where there are really that many teams having challenges meeting the floor we're more likely to see a change to those limits in the CBA imo.
Yeah. The floor has been 16M below the ceiling.
In 05-06, the cap was 39M and the floor was 23M, or 58.9% of the ceiling.
This year, the cap is 59.4M and the floor is 43.4M, or 73.1% of the ceiling.
if cap floor clubs have problems, the payroll range will be widened. Could happen as soon as the next CBA.
As your figures show, this is becoming a problem. There are a lot of teams in the south that are loosing a good bit of money and I think it would be foolish to conclude that the wouldn't try something like this.
Something similar has already happened, though not because of poor finances. Remember what the Devils did the first year with San Jose and Zhamnov? (I think it was him anyway)
The Sharks got a pretty good deal in exchange for letting a retired player occupy some of their cap space for a year.
The Isles aren't doing so great financially and if you take out Yashin's cap hit, their payroll sits at $41.4 million, which is obviously below the floor. It's not exactly like the scenario I posed is that far outside of the realm of possibility.
Sure there's a possibility that it might get fixed in the next CBA, but it seems like you're concluding that it's a given that it will be if the owners don't like it. The problem with that is that the NHLPA has a vested interest in keeping the floor as high as possible and probably won't just go along with it without some sort of concessions going the other way.
Why does the NHLPA has a vested interest in keeping the cap floor as high as possible?
Lower than today.
Yes, I'm serious.
Because it forces franchises to pay more money out to the players.
I'll use an extreme to further illustrate my point. Let's say the floor was $10 million instead of ~$40 million, and 5 of the poorer teams (in an effort to lose as little as possible) only spent up to the established $10 million floor. That's a total of $150 million not being spent on the players that the NHLPA represents. Because the floor is lower and some teams will cut back on spending, it puts downward pressure on salaries across the rest of the league. The NHLPA is best served by having both a high cap, and a high floor. If they could have a $50 million floor, I'm sure they'd be thrilled.
If the owners went to the NHLPA during the next CBA negotiations and told them that they wanted to reduce the floor by $5 million per team, I don't think you'd find the NHLPA in a position of agreeing with the change without getting something of value in return.
I'm not saying that it's not going to happen and I'm certainly not saying that it shouldn't happen. I just don't expect the NHLPA to lay down and take it without a fight.
Why would that happen? The NHLPA wouldn't like it and neither would the many teams that are spending close to the cap that would have to make moves in order to comply with the reduced cap.
But the players still get their negotiated 54-57% of NHL revenue. If they're overpaid then they give $ back to the owners via escrow. If they're underpaid then the owners give them extra $ over their salaries to bring them up to the 54-57% agreement.
The cap and floor help even out the escrow process by restricting the range that total compensation can veer from the projected 54-57% midpoint, but the cap and floor don't change how much total $ the NHLPA members actually take home at the end of the season. If you reduced the floor by $5m tomorrow the players would still make the same total amount of $.
Cap will be gone
At $200 a barrel of oil, it's not going to matter much what the BoG or NHLPA "wants".
I also expect meaningful contraction in the number of teams.
More likely around, with some tweaks than not.
Entrophy and Newton's third law.
Any chances with the next CBA, that the "hard" cap is dispensed with, and a Luxury cap/tax in it's place?
Only if there"s "cost certainty"
We need something resembling the NBA's Bird rights so that teams can keep their drafted stars. That's what I want more than anything.
Which NHL teams have lost their drafted stars because there's no "Bird" rule in the NHL?
Even with a deflationary snap back following a burst of hyper inflation it should still still end up higher in nominal terms. Real terms, you are probably right.
While I agree, it should be pointed out that if the general western financial bubble bursts as badly as it could do this won't just be a Hockey issue, it'll be a global sporting issue.
Isn't that the tremendously flawed rule that basically leads to every major "free agent" being signed and traded instead of truly hitting free agency so that the signing team can evade the cap?
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