This is a repost of a blog I read on Broad Street Buzz. Take a read:
On September 16th, 2004, the NHL locked out its players and forwent their 88th NHL season. Almost exactly eight years to the day, the NHL owners and Commissioner Gary Bettman are ready to do so again. After more than two months and three different proposals, talks broke down in late August, with neither side able to find even ground. Talks are scheduled to resume with the September 15th deadline breathing down their neck, but an agreement seems unlikely.
And that’s a good thing for the sake of the league.
There, it has been said. Somebody had to do it. Through all the fan protest and dissatisfaction with negotiations, not many have realized: The NHL owners desperately need this lockout. It seems selfish that billionaire owners with enough money to finance a professional hockey team with ease refuse to give leeway in CBA talks, but they are most certainly right in their bargaining tactics.
No matter what happens in American sports, the National Hockey League will never be able to crawl out of the cellar when it comes to viewership. Last year’s Stanley Cup finals averaged just 3.01 million viewers, according to tvbythenumbers.com. In relation to the 2011 Stanley Cup Finals, ratings were down by 1.56 million viewers, or 34%. The NFL’s annual “Pro Bowl”, a game in which the players participating put forth minimal effort, recorded a whopping 12.5 million viewers, and that was down over 8%. The 2007 NBA Finals between the Cleveland Cavaliers and the San Antonio Spurs scored some of the lowest ratings the NBA had seen, yet still averaged 9.3 million viewers. As hard as it may try, the National Hockey League cannot hold the viewership of the casual sports fan, and it’s bad news for the league as a whole.
It’s even worse news for small market teams. When the league cannot even get an abundance of people to watch their biggest games of the year from the comfort of their home, they’re even less likely to buy tickets. Yes, the NHL does boast many financially stable teams like Toronto, New York, and Philadelphia that sellout their respective arenas almost every night, but for every successful large market, there’s two small market teams struggling to tread water.
According to Forbes.com, a team’s Operating income is a team’s “earnings before interest, taxes, depreciation, and amortization”. In the 2011-2012 season, seventeen teams were not able to turn a positive operating revenues including St. Louis, Carolina, and Tampa Bay, among others. Even before having to make payments, teams are unable to make any money. Also noted by Forbes, 9 teams have seen a decrease or no change in their team valuation since last season. Most notably, New Jersey, Florida, Columbus and Phoenix, all teams who have struggled financially, are on that list. The Devils owner may lose possession of the team, Phoenix has spent a couple of years under NHL control, and the Islanders have struggled for years to fill their arena. So what is important about all these stats? Notice that all of these teams are those stuck in small markets.
This is what the NHL labor talks are all about: protecting the little guys.
And the Shea Weber ordeal is exactly what is wrong with the National Hockey League. When Weber agreed to the incredibly front loaded 14 year, $110 million, the terms almost made you cringe. In a full calendar year, he would receive $27 million in signing bonuses alone, regardless of whether the NHL had a season or not, and $52 million in bonuses over the first four years of the deal. A deal like that is everything the NHL owners are currently trying to avoid for a very long time. While Ed Snider probably spent that week puffing on cigars, Nashville’s front office spent their week crunching numbers, trying to figure out how the hell they’ll pay Weber and still be able to think about turning profit. The Predators have a franchise value of $163 million; Shea Weber would be guaranteed to make 16.5% of the entire team’s worth in one season. Nashville and David Poile are the ant, and Ed Snider is the bully with a magnifying glass. With the fear of losing their franchise player and one of the few players Nashville fans resonate with, the Predators decided to match his contract. But one word comes to mind when you think of Shea Weber and his current $7.9 million cap hit: crippling. For a team that has not made money since 07-08 where they turned a measly $500,000 profit, could there possibly be any reward to this risk?
The answer is no, and this is what the owners want to correct. When the league asked for five year max deals and a rollback in player salaries, it’s not because they’re a bunch of no good penny pinchers. With players salaries rising exponentially each year, smaller teams are struggling to keep their superstars when it comes to contract negotiation time. Not every team in the NHL is owned by a billion dollar corporation like the Philadelphia Flyers are, and the goal for the owners during CBA talks is to level the playing field.. They are not going to cave to the players demands just to get a season started on time. These are smart businessmen and investors, and they are tired of throwing their money in a campfire and watching it burn every season. Their investments need to be protected, and in the NHL’s current economic system they’ve failed to do so.
So what will happen in the coming weeks and months? The two sides will break off discussions, the teams will close their doors, and we will be headed for a nuclear winter like in 2004. The players will of course cave right around December, the owners will find themselves on the better end of the deal, and we’ll be playing hockey by New Year’s.
While most throw their fists into the sky and curse the owners for making them miss out on most of their beloved sport, for the people concerned with the welfare of hockey in America, that should be music to their ears.
A win for the owners is a win for the sport of hockey. Instead of watching your teams’ favorite forward get lost in the stacks of money the big market teams offer him, they will actually be able to keep him. Instead of hearing the PA announcer announce a nightly attendance of 12,420 people, soon all the seats will be filled. And instead of watching multiple teams fold, the National Hockey League will soon be able to have all thirty teams strive.
Now isn’t that what everybody wants?
Thanks for reading. You can follow me on Twitter @JakePavorsky.
Tags: commissioner gary bettman, Lockout, national hockey league, NHL Lockout, NHL Lockout 2012
taping the stick 