Kukla's Korner

Kukla's Korner Hockey

Blame The NHL Owners And Bettman

from Elliott Teaford of the DailyBreeze,

Didn't these same owners get everything they demanded when they locked out the players for the entire 2004-05 season? Didn't they get a salary cap, the cost certainty they said they needed to survive? Didn't they win their bet the fans would return in droves?

Of course they did.

So, if the owners got every single thing they wanted from the last labor mess, why are they doing it all over again? Precisely because they won that last fight so handily. They believe if they can do it again they can crush the union again and increase their profits again.

It's cynical, it's greedy and it's disgusting.

Now, it's true some franchises are struggling financially. But if the Coyotes can't turn a buck in the Phoenix suburb of Glendale, Ariz., or the Blue Jackets can't cut it in Columbus, Ohio, then maybe those teams should be relocated to Toronto, Quebec City, Seattle or wherever there's a viable market.

Maybe a team in South Florida can't work financially but can in Portland, Ore.

I don't have all the answers.

What I do know is the players and fans are getting the short end of the hockey stick.

more

Filed in: NHL Talk, | KK Hockey | Permalink
 

Comments

Hank1974's avatar

Couldn’t disagree more.
The reason the Owners are so hellbent on getting their way this time is because they got taken to the cleaners last CBA. At first, it looked like a slam-dunk victory, but after 8 years, the players clearly won that battle.
The average player salary went up $1M, franchise value’s, as a whole, didn’t go up all that much, with some teams taking a massive plummet, and despite seeing league earnings go up $1B, the players got 57% of those earnings.
In some cases, like the Habs, despite earning more, they had to give out more for revenue sharing, and actually saw LESS profits than they had from the previous CBA.

No, this lockout is about Bettman hoping to improve his 0-2 record.
He got pwned the last 2 so he and the owners are hellbent on finally winning one.

Posted by Hank1974 on 12/24/12 at 08:29 AM ET

J.J. from Kansas's avatar

The average player salary went up $1M, franchise value’s, as a whole, didn’t go up all that much, with some teams taking a massive plummet

As a whole, NHL franchise values have increased 72%

I’ve bolded every team whose Forbes franchise valuations hasn’t increased by more than 22% (which is a high-sided estimation of inflation since 2004).  There are seven of them, five of which saw their values decrease. Dallas by $19M (7.3%) and Colorado by $36M (14.6%) were the largest decreases. We have heard that Dallas is one of the hard-liners in this lockout, but like always, Stan Kroenke has stayed quiet out of Colorado (or maybe out of his 124,000 acre $130M ranch in Montana… I don’t know where he’s at right now).

Team Valuations 2004/2012

Toronto: 280 / 1,000
NY Rangers 282 / 750
Montreal 195 / 575
Chicago 178 / 350
Boston 236 / 348
Detroit 248 / 346
Vancouver 148 / 342
Philadelphia 264 / 336
Pittsburgh 101 / 288
Los Angeles 193 / 276
Washington 115 / 250
Calgary 116 / 245
Dallas 259 / 240
Edmonton 104 / 225
San Jose 149 / 223
Ottawa 125 / 220
Minnesota 163 / 218
Colorado 246 / 210
New Jersey 124 / 205
Winnipeg 106 / 200
Anaheim 108 / 192
Buffalo 103 / 175
Tampa Bay 150 / 174
Florida 121 / 170
Nashville 111 / 167
Carolina 100 / 162
NY Islanders 160 / 155
Columbus 139 / 145
Phoenix 136 / 134
St. Louis 140 / 130

In some cases, like the Habs, despite earning more, they had to give out more for revenue sharing, and actually saw LESS profits than they had from the previous CBA.

Did they? The information I’ve found has the Habs clearing more than $50M now, when they only cleared $7.5M back then.  If the sources who state that the Maple Leafs lead the way in revenue sharing and that they pay about $20M into that pot are correct, I don’t know the Habs aren’t clearing more in profits than they were prior to the last lockout.

I don’t agree with the categorization that the owners “lost” the last lockout. Overall, things are much, much better for the NHL than they were in 2004. I also don’t believe that their positions so far in this lockout have effectively attempted to address the places where things haven’t gotten much, much better.

Posted by J.J. from Kansas on 12/24/12 at 09:37 AM ET

Avatar

As a whole, NHL franchise values have increased 72%

Index that for inflation and watch what happens to franchise values of around 20+ teams in the NHL.

And then try and tell me who would buy most of those franchises at the prices they are ‘valued’ at.

‘Franchise value’ is only relevant as a point of financial health if it accurately represents what an asset would be sold for, and that it would be sold in a timely manner at that presumed value.

Further. dig into how Forbes (or anybody, really) calculates ‘franchise value’.  In a lot of cases the things that actually contribute most to the ‘value’ of the ‘franchise’ are the physical properties and assets of the franchise, not the actual hockey ops business.

don’t agree with the categorization that the owners “lost” the last lockout. Overall, things are much, much better for the NHL than they were in 2004.

I don’t think the owners lost the last lockout either.  They won.  Then Bettman wrote a really, really stupid CBA and things collapsed.  In 2005 he should have done the things he is trying to do now.  But he didn’t.  Because he sucks at foresight.

This is why he’s doggedly hanging on so many different contractual/structural terms.  He knows he sucks at foresight so any revisions he makes to the NHL’s proposals are almost certainly going to blow up in his face.

The NHL has to get 5/7 year contract limits, and 50-50 revenue, and this or that… they don’t trust themselves to set up a rational, effective CBA around them if they don’t.

And they shouldn’t.  Because they can’t.  Because they suck at their jobs.

Posted by HockeyinHD on 12/24/12 at 10:05 AM ET

gusoline's avatar

As J.J. already said in his post

I’ve bolded every team whose Forbes franchise valuations hasn’t increased by more than 22% (which is a high-sided estimation of inflation since 2004).

And trying to separate Hockey Ops from other franchise value is a red herring.  You don`t buy Hockey Ops you buy (or sell) the franchise.  It is the total value and if the particular hockey ops lose money, but they make it up in other areas, that is the full value of the franchise.  Many businesses have loss-leaders that they use to drive sales of other high-revenue items.  Same thing here.

Posted by gusoline on 12/24/12 at 10:20 AM ET

Avatar

And trying to separate Hockey Ops from other franchise value is a red herring.  You don`t buy Hockey Ops you buy (or sell) the franchise. 

... which is hockey ops.

The value of a thing is affected by the utility of the thing.  If a really nice car gets 4 miles per gallon, that’s going to negatively impact the value of the car because the car is more expensive to operate.  So spending a bunch of money to obtain an asset that’s costly (up to the point of prohibitively costly) to operate is dumb.

So people who are not dumb will not spend their money on the acquisition of an asset which is dumb to have.

Which means an asset ‘value’ which doesn’t take that into account isn’t going to give you a very clear picture.

Many businesses have loss-leaders that they use to drive sales of other high-revenue items.  Same thing here.

Then you’re not talking about the value of a franchise.  You’re talking about the value of a business unit in which a franchise is included, and where the actual hockey part of the unit is a ‘loss leader’ which, once a franchise gets the building and the lease agreement, is wholly worthless.

This is why I doubt most owners care too much about whether hockey is played or not.  The hockey allowed them to get the building, which they use to actually make money.  All playing hockey does for a lot of those guys is cost.

That is the problem.

Posted by HockeyinHD on 12/24/12 at 11:31 AM ET

gusoline's avatar

I disagree, hockey ops is not the franchise.  The building, the arena, the rights to merchandise, all are components of the Franchise along with the actual hockey revenue from ticket receipts and TV deal rev sharing etc. 

Other then maybe the Leafs, no one would buy a franchise without some kind of arena deal along with it.

The car analogy is poor.  By your argument, no one should buy a Ferrari because they get such poor gas mileage.  If I am ever able to be in the market for a Ferrari, I would not allow the gas mileage to enter into my purchase decision.  Now whether buying a Ferrari (or an NHL franchise) is dumb, is a whole other question.

Posted by gusoline on 12/24/12 at 12:33 PM ET

Avatar

The reason the Owners are so hellbent on getting their way this time is because they got taken to the cleaners last CBA.

HAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHA

Posted by Garth on 12/24/12 at 12:38 PM ET

gusoline's avatar

Another point about the loss-leader idea.  I would assume that (unless their lawyers are idiots) no municipality would allow the owner to operate the arena without the team playing (except in the case of a lock-out or a strike).  Therefore, this would remain exactly a loss-leader if they can`t make money on HRR.

Posted by gusoline on 12/24/12 at 12:53 PM ET

OlderThanChelios's avatar

The NHL has to get 5/7 year contract limits, and 50-50 revenue, and this or that… they don’t trust themselves to set up a rational, effective CBA around them if they don’t.

And they shouldn’t.  Because they can’t.  Because they suck at their jobs.

So here we sit, without hockey because a bunch of rich guys can’t be trusted to do what’s right for their own businesses. And because they can’t stop themselves from signing ridiculous contracts, the “solution” is to punish the players for it by periodically stripping them of the money that was given to them willingly (and often eagerly) by the owners.

So let’s say the owners get the true 50-50 deal (plus all of the contract changes) they want this time. Does anyone doubt that the Garden Gnome will be back again in eight years complaining that those idiot owners have managed to find a way around the “protections” built into the new CBA and are, once again, screwing themselves?

Of course they will. And the reason is, and here’s one of the few thing HockeyinHD gets right, they suck at their jobs. As long as that’s true, the players are going to be asked to pay (literally) for the owners’ mistakes.

And eight years from now, while yet another season gets wiped out, we’ll once again be sitting around talking about hockey instead of watching it. Just pathetic.

 

Posted by OlderThanChelios from Grand Rapids, MI on 12/24/12 at 01:25 PM ET

Avatar

Does anyone doubt that the Garden Gnome will be back again in eight years complaining that those idiot owners have managed to find a way around the “protections” built into the new CBA and are, once again, screwing themselves?

I highly doubt Bettman will be Commissioner for the next CBA. Age alone will dictate that there will be a new NHL leader.

Posted by timbits on 12/24/12 at 07:18 PM ET

HockeytownOverhaul's avatar

Captain D, i love when you chime in

Posted by HockeytownOverhaul on 12/25/12 at 03:19 PM ET

redxblack's avatar

Elliott teaford sounds like he’s been reading the comments here for the last three months.


Garth - once again, perfect response to a goofy posting.

Posted by redxblack from Akron Ohio on 12/25/12 at 07:35 PM ET

Add a Comment

Please limit embedded image or media size to 575 pixels wide.

Add your own avatar by joining Kukla's Korner, or logging in and uploading one in your member control panel.

Captchas bug you? Join KK or log in and you won't have to bother.

Smileys

Notify me of follow-up comments?

Feed

Most Recent Blog Posts

About Kukla's Korner Hockey

Paul Kukla founded Kukla’s Korner in 2005 and the site has since become the must-read site on the ‘net for all the latest happenings around the NHL.

From breaking news to in-depth stories around the league, KK Hockey is updated with fresh stories all day long and will bring you the latest news as quickly as possible.

Email Paul anytime at pk@kuklaskorner.com

 

image

image