State of the NHL

[repenttokyo]

Canadian teams also pay much higher taxes than american teams.

[gdon]

hoopej2 wrote:

One thing that is rarely mentioned about why the Canadian teams are doing a little better the past two years is the strength of the Canadian dollar against the greenback. All salaries are in US dollars, so 4 years ago when the exchange rate was 66% and a team was paying someone a $9 M US, they had to generate about $14 M Cdn in ticket sales/marketing to recoup that cost. Today the exchange rate is 90% so they would only have to generate $10 M to recoup the cost of the contract. That is a $4 M difference which is absolutely huge in helping the Canadian teams do well.

This is obviously cyclical so it should not be counted on in the future.<br><br>Post edited by: hoopej2, at: 2007/06/11 11:19

Good point hoopej2. I\'m surprised no one has mentioned contraction. I think 26 teams would make for a much more competitive league and more solid franchises. Losing Florida, Phoenix, Atlanta and Tampa (yes I saw the attendance #s but I don\'t believe Tampa is making any money and is anywhere near a stable franchise) but I\'m sure there are others that could be dropped as well.

[repenttokyo]

gdon wrote:

hoopej2 wrote:

One thing that is rarely mentioned about why the Canadian teams are doing a little better the past two years is the strength of the Canadian dollar against the greenback. All salaries are in US dollars, so 4 years ago when the exchange rate was 66% and a team was paying someone a $9 M US, they had to generate about $14 M Cdn in ticket sales/marketing to recoup that cost. Today the exchange rate is 90% so they would only have to generate $10 M to recoup the cost of the contract. That is a $4 M difference which is absolutely huge in helping the Canadian teams do well.

This is obviously cyclical so it should not be counted on in the future.<br><br>Post edited by: hoopej2, at: 2007/06/11 11:19

Good point hoopej2. I\'m surprised no one has mentioned contraction. I think 26 teams would make for a much more competitive league and more solid franchises. Losing Florida, Phoenix, Atlanta and Tampa (yes I saw the attendance #s but I don\'t believe Tampa is making any money and is anywhere near a stable franchise) but I\'m sure there are others that could be dropped as well.

Why does everyone want to drop Atlanta and Tampa when there are teams like Columbus out there that serve absolutely no purpose.

[wizworm]

Thanks for the great article lanky! It summed up a lot of what is wrong right now with the NHL. But you know what is missing? There\'s nothing in there about the ridiculousness that is the NHL salary cap.

Bettman and the owners bitched and moaned about how a cap was needed so that the small market teams could afford to compete with the rich clubs that could out-spend them. They argued a cap would level the playing field for all the teams and increase competitiveness. Well guess what? The cap is set to rise to somewhere between 48 and 50 million dollars for the upcoming year.

Remember waaaaaaay back all of THREE years ago when the PA suggested something like a 49 million dollar cap in order to try and save the season from being cancelled? Well, the owners rejected it because it was too high and we all missed out on hockey for a year. And for what? Just a few short years later the cap for the upcoming season is in the exact range the PA presented before the lockout.

So what’s the big deal?

Well, the owners were right. A 49 million dollar cap ceiling IS too high for most NHL teams to support.

The Nashville Predators, one of the best teams in the league and a Stanley Cup contender can’t sell out their home games and receive little support from corporate sponsors and their community. It’s forced them to depend on the NHL’s revenue sharing program in order to survive in that market. Without it, the team would only be able to support a budget of something like 20 million dollars. That’s not even enough to meet the current cap floor of 21.5 million! But Nashville isn’t the only team in this predicament. There are other small market teams in the league that can’t afford a 20 or 30 million dollar cap ceiling let alone a 50 million dollar one.

That’s sad, but the real ridiculousness of the NHL’s salary cap is the fact that it’s linked directly to revenue. As profits go up, so does the cap ceiling. That leads the NHL right back to where they were before the damn lockout and the cap system was introduced in the first place!

The current cap, linked as it is to league revenue, totally disputes the owner’s suggestion that the cap was going to somehow level the playing field and make every team competitive. If there are teams in small markets around the league right now that can’t even afford to meet the cap minimum without assistance than it’s not hard to see that they’ll never be able to spend to the upper limits of the cap like the rich teams do because they simply won’t be able to support it. As the cap goes up, the gap between what the rich teams will spend at the top and what the poor teams will be able to afford will just increase.

So 3 short years and one lockout later what has really changed about the way the NHL is run? It’s still a league where the rich teams have a competitive advantage because they can afford to spend more money. The only thing that has really changed is that now there is a system in place which puts a limit on just how much more money they can spend than the smaller market clubs.

[wizworm]

Post edited by: wizworm, at: 2007/06/17 10:29

[gdon]

Why does everyone want to drop Atlanta and Tampa when there are teams like Columbus out there that serve absolutely no purpose.

Columbus is still drawing more than 16,000 for watching a crummy team. They\'re the only pro team there so they only have to battle OSU for sports coverage. It makes more sense to be there than the Southern belt where its the 7th priority on the sports calendar.