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How does revenue sharing work

Jul. 28, 2022 at 10:36 a.m.
#1
Kster
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Trying to figure out how (which teams receive) revenue sharing works. NHL clearly doesn’t want that info easily ‘ publicly available. But combined with salary cap, it’s a truly horrible system. Popular teams like Leafs (I acknowledge there are other popular teams like habs, bruins, rangers, etc) that generate significant revenue have to subsidize unpopular but competitive teams (only guessing but thinking panthers, hurricanes, preds). Would like to see a new role something to the effect of - if you receive revenue sharing, your upper salary cap is reduced by half that amount. Opposite if you contribute revenue - your upper salary cap increases by half the amount you contribute to sharing. I’m all for competitive balance but it is also a Really perverse system that leaf fans are helping panthers organization be more competitive, while hard cap limits ability of leaf organization to compete fully
Jul. 28, 2022 at 1:21 p.m.
#2
LongtimeLeafsufferer
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Quoting: kster34
Trying to figure out how (which teams receive) revenue sharing works. NHL clearly doesn’t want that info easily ‘ publicly available. But combined with salary cap, it’s a truly horrible system. Popular teams like Leafs (I acknowledge there are other popular teams like habs, bruins, rangers, etc) that generate significant revenue have to subsidize unpopular but competitive teams (only guessing but thinking panthers, hurricanes, preds). Would like to see a new role something to the effect of - if you receive revenue sharing, your upper salary cap is reduced by half that amount. Opposite if you contribute revenue - your upper salary cap increases by half the amount you contribute to sharing. I’m all for competitive balance but it is also a Really perverse system that leaf fans are helping panthers organization be more competitive, while hard cap limits ability of leaf organization to compete fully

You are correct in how the "rich" teams help subsidize the poor teams. But the revenue that flows from the rich owners to poor owner, still allows the Leafs to be very profitable as their player cap is still based on 50% total NHL revenue.
It's a very "socialistic" system for the owners and players. If there was not a salary cap.....their might only. be 16 teams. The high revenue teams could largely be profitable and the players in the NHL would share a 50% revenue which might make 110m cap. But of course the 16 owners that couldn't afford be in the NHL would have now a zero value NHL franchise and might lose more money with an empty arena if they were the owners of the arena too. And half the players in the NHLPA would be without jobs....so they voting members of the NHLPA want as many teams and therefore NHL salaries.
So the players and owners are forever linked to revenue sharing.
Jul. 28, 2022 at 2:09 p.m.
#3
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Kster
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Quoting: palhal
You are correct in how the "rich" teams help subsidize the poor teams. But the revenue that flows from the rich owners to poor owner, still allows the Leafs to be very profitable as their player cap is still based on 50% total NHL revenue.
It's a very "socialistic" system for the owners and players. If there was not a salary cap.....their might only. be 16 teams. The high revenue teams could largely be profitable and the players in the NHL would share a 50% revenue which might make 110m cap. But of course the 16 owners that couldn't afford be in the NHL would have now a zero value NHL franchise and might lose more money with an empty arena if they were the owners of the arena too. And half the players in the NHLPA would be without jobs....so they voting members of the NHLPA want as many teams and therefore NHL salaries.
So the players and owners are forever linked to revenue sharing.


Thanks, good feedback. I did not think that through fully. But I am not arguing to get rid of revenue sharing or cap. Just should be some system to reward the teams that generate more revenue. As an example: assume cap is $80M, Leafs contribute $20M to revenue sharing and Panthers receive $10M in revenue sharing. Leafs cap moves to $90M, and panthers cap drops to $75M. Not sure how this would impact 50-50 revenue sharing between players & owners - that would need to be worked out and adjustments made as needed. Just really weird that (per this fictional example) Leafs are paying money to Panthers to temp them compete (which is frustrating but understandable) but then Leafs are kept from spending beyond cap which they can financially , again to help the have nots like panthers stay competitive (infuriating) at the leafs expenseVery Angry !
Jul. 28, 2022 at 2:51 p.m.
#4
LongtimeLeafsufferer
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Quoting: kster34
Thanks, good feedback. I did not think that through fully. But I am not arguing to get rid of revenue sharing or cap. Just should be some system to reward the teams that generate more revenue. As an example: assume cap is $80M, Leafs contribute $20M to revenue sharing and Panthers receive $10M in revenue sharing. Leafs cap moves to $90 M, and panthers cap drops to $75M. Not sure how this would impact 50-50 revenue sharing between players & owners - that would need to be worked out and adjustments made as needed. Just really weird that (per this fictional example) Leafs are paying money to Panthers to temp them compete (which is frustrating but understandable) but then Leafs are kept from spending beyond cap which they can financially , again to help the have nots like panthers stay competitive (infuriating) at the leafs expenseVery Angry !


I understand your frustration. But since there seems to be more "teams in need" than self sufficient teams, so I don't see any changes soon.
And allowing some teams to spend more than others.....well that should might lead to some teams never being competltive...and then ultimately the teams closing down.

The NHL seems gone the way the NFL operates at least when it comes to salary revenues to the players and players salaries being spend by team. MLB doesn't have much of a salary at all, so it sure looks like teams like the Yankees, Red Sox and Dodgers can always outspend their mistakes.
Jul. 28, 2022 at 2:57 p.m.
#5
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Kster
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Quoting: palhal
I understand your frustration. But since there seems to be more "teams in need" than self sufficient teams, so I don't see any changes soon.
And allowing some teams to spend more than others.....well that should might lead to some teams never being competltive...and then ultimately the teams closing down.

The NHL seems gone the way the NFL operates at least when it comes to salary revenues to the players and players salaries being spend by team. MLB doesn't have much of a salary at all, so it sure looks like teams like the Yankees, Red Sox and Dodgers can always outspend their mistakes.


All good points, and EPL (European soccer) does not have a salary cap - there is a form of revenue sharing as all teams, in epl anyway, receive equal share of tv money $. The ‘ have not’ teams don’t die off in either MLB or EPL but maybe Florida or Carolina would fold if they weren’t getting money from the rich team. Still think there is some room for improvement, but could be cost of having 32 teams in the league - many in non traditional hockey markets .
 
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