Quoting: TheGxForum
No...it's called free market...not magic...besides if other sports don't need hard salary caps why does hockey?
I am 100% in favor of free markets
But NHL is not a free market. It is very much a closed market. It’s a legally permitted monopoly, that avoids anti-trust regulations by negotiating various terms with government (on of them being no contraction). There is no way for teams to disappear as long as the league is still active. And there is no way for a team to be added to league, unless owners award another franchise. It’s not like Soccer, where the Hersey Bears win AHL on year and play against NHL the next.
To eliminate the salary cap, the choice would have to be unanimous. Dissenting teams can still block. So the path to changing cap is for specific cartel of teams walk away from CBA (or from league altogether)
If the bottom third of the league falls off, the league loses fans, their eyeballs and their revenue. So if the overall size of the NHL pie shrinks, the TV contracts will shrink. The gate revenue will shrink by having fewer venues. Everyone will make less money from league-wide HRR. But everyone will have fixed costs in their market. They have buildings, practice facilities, staff, etc. They will very likely see revenues shrink a lot faster and lower than their liabilities. So the clubs with the largest operations (big arena, start of art practice facilities, huge scouting staff, lots of comfort, lots of high-tech) that spend the most will end up cutting the most. Their ‘advantage neutralized’. Eventually, many will likely move to the more attractive locations. Taxes will become a larger determinant for selection locations. Teams that want to build new arenas, or make other big ticket expenditures, will have less asses to public money (since anti-trust agreement was broken). So they will have to self finance with much higher interest rates since any loans would not be co-signed or backed by the league. So if your arena needs help, you team most likely movies cities. If your taxes are high, your team likely moves cities. If you team has big operational advantage in cap era, it becomes liability in post-cap era.
There will be different teams in the league every year. “Start-up” clubs will appear, disappear. Existing owners, no longer compensated for new entrants would now be competing with them, not only in the ice, but off the ice ice well. Targeting one franchise to fold would be their goal, obtaining their players, arenas, or revenue streams would be the motivation.
As clubs will be changing cities often, and with the high franchise mortality rate at bottom of league, that will also impact player contracts. The overall pie will shrink, so their AAV will go way down. But will such-year-to-year uncertain, term will likely trend toward average length of below 1.5 (meaning a majority of SPCs will be without term). That means more players will be shuffling around year-to-year, market-to-market. Eventually, that will have the effect of reshuffling the deck each year for a very large portion of the league. No cap, means no limits on contract amounts. So they top guys will get paid. But also means guys at bottom will not. The bottom third of the league would look like AHL. For example,
- Top 5%: stars making very high salary
- Next 30%: NHL talent making NHL salary
- Next 35%: NHL talent making AHL salary
- Next 20%: AHL talent making AHL salary
- Last 10%: AHL talent making ECHL salary
League GINI index rises considerably. In that scenario, salaries of the lower half of league will decline. Lower pay will draw in less talent. Today, we have 32 teams with 23 roster spots. That 736 NHLers league wide. In the post-cap scenario, there would be about 300 fewer spots, and another 100 or so getting replaced by cheaper talent. (Eventually, many of those NHLers probably migrate to AHL, which would no longer be an affiliated league but a rival league mirroring late 1970s WHA).
Any intrinsic advantages one club may enter this post-cap era with would quickly be disappear. Within a decade, the league would be unrecognizable, third rate, poverty league. The following decade, after years of kids bailing in the sport, will see huge decline in quality. A decade after that, professional hockey will limited to a handful of local, semi-pro leagues in northern US and Canada.