Thursday, June 28, 2012

NHL/NHLPA Draw Lines in Sand!

1) This is the word we're hearing from almost all our sources on both sides of the debate.  Certainly FR2's excellent and amazing post yesterday on how far the NHL is apparently prepared to go to win(faux-snubbing Brendan Shanahan into the Hall of Fame) indicates that even though there hasn't yet been an official meeting among the parties, they are both preparing for the worst.

2) Lets start with some simple numbers.  The NHL wants to significantly reduce the players % of revenue, currently at 57% to either 50% or if possible the upper 40's.  As of right now with the status quo, without a salary rollback, next season’s salary cap ceiling would be $70.3 million and the cap floor $54.3 million. If the NHLPA activates its five percent escalator clause, the numbers jump to $73.815 million and $57.815 million.  Amazing numbers when one thinks that after the last Bettman lockout the ceiling was a mere 39 milion!

3) Now assuming a seven percent rollback (to incorporate a 50-50 revenue split with the league), the cap would be just over $62.649 million, while the cap “floor” would be $46.649 million.  If the PA still has that five percent escalator under the next CBA, the numbers jump to just over $65.781 million and $49.781 million.  As you can see that still is a big jump over what it was in  2005 and why we believe the sources who tell us the owners will not only ask for the 50% (minimally) split, but also the elimination (or BIG reduction) in the floor which undeniably is hurting the small-revenue teams.

4) On the other side, the players will go into the negotiations wanting a status quo approach and ask the NHL/owners to better share their revenue with a luxery tax, etc. (much like they asked in 2004).  The players correctly will point out that the owners alone decide where the franchises are placed (ie: Phoenix/Florida) so they alone should be the ones who assist these weaker sisters, not punish the players (as they did in 2004)  The problem for the owners is that they lost the 'players are greedy' argument when they got their "Cost certainty" last time around.  Fehr will certainly use the leagues onw rhetoric against them if they try to argue for big changes.  They can also point to the imense increase in revenue by moving a dead franchise (Atlanta) to a thriving location(Winnipeg).  How much more would the league grow if the Yotes/Panthers moved to Quebec City/hamilton Ontario?

5) Not that the league will abandon the 'players are greedy' approach altogether. Thus the FR2 post that Shanahan wil be used as the public image of the NHL during the CBA negotiations as the "Face of compromise" which the league will use to get fans to be sympathetic to their side of the talks especially as anticipated by everyone it gets nasty and protracted.  We are told initial talks will be all about each side giving its position and the rationale behind them.  It probably won't last long and both sides will walk away and start using their talking points until the real talks begin again in August.  The sides will know by then (especially the players) if they have the appetite to lose a season over a few % points/more revenue sharing?  Stay tuned folks, its gonna be a bumpy summer/early fall!(At least!)

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