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Salary Cap Needs to be Revised

Jan. 15 at 7:30 p.m.
#26
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Quoting: Leafsfan98
Like the idea, but considering how much that idea would benefit smaller market teams... I'd have brackets... Over 1- 15% of the cap does the 2:1, 15-25% is 3.5:1 and anything above 25% is 6:1 and a loss of your upcoming 3rd and 4rth round picks

That way smaller market teams are more likely to get the extra bit of money while still holding a more competitive team... And the bigger market teams/building teams can benefit from being big markets...


Brackets is a good idea...anything to get out of hard caps I'd agree with👍
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Jan. 15 at 7:33 p.m.
#27
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Quoting: Leafsfan98
I think having no cap ensures a team like the A's have no chance of winning

That's the issue... How is AZ supposed to win when their payroll is 1/10 of Toronto's?


Nah A's won before when they had no cap so it's the team and management fault if they can't win it's the fans fault if a team moves because lack of ticket sales...as for Zona well they can move to a better market team no point trying to force a team to stay where they can't make money...
Jan. 15 at 8:00 p.m.
#28
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Quoting: Leafsfan98
Like the idea, but considering how much that idea would benefit smaller market teams... I'd have brackets... Over 1- 15% of the cap does the 2:1, 15-25% is 3.5:1 and anything above 25% is 6:1 and a loss of your upcoming 3rd and 4rth round picks

That way smaller market teams are more likely to get the extra bit of money while still holding a more competitive team... And the bigger market teams/building teams can benefit from being big markets...


There is no point in the cap system in hockey if you're letting teams spend 25% or more above the soft cap for a third rounder. Big markets should be able to flex their wallets for a competitive advantage, but in a way that is not broken. Give them a small percentage of extra space available up to a hard cap, and make them pay for it. Builds parity and helps small and new markets get their feet under them. Also sends franchise values through the roof, which is the real reason billionaires buy teams. It'd also help if the league wasn't brain dead in their efforts to market the sport. Everybody is more competitive, and everybody is happy.
Jan. 15 at 11:07 p.m.
#29
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Quoting: Pompadour_de_Armstrong
There is no point in the cap system in hockey if you're letting teams spend 25% or more above the soft cap for a third rounder. Big markets should be able to flex their wallets for a competitive advantage, but in a way that is not broken. Give them a small percentage of extra space available up to a hard cap, and make them pay for it. Builds parity and helps small and new markets get their feet under them. Also sends franchise values through the roof, which is the real reason billionaires buy teams. It'd also help if the league wasn't brain dead in their efforts to market the sport. Everybody is more competitive, and everybody is happy.


I see what you're saying but I'd rather see the free market kill off bad markets and let rich markets spend as much as they want...survival of the fittest is what I wanna see in sports...
Jan. 15 at 11:14 p.m.
#30
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They had that system already. They didn't like it.
Jan. 16 at 8:09 a.m.
#31
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Quoting: TheGxForum
Nah A's won before when they had no cap so it's the team and management fault if they can't win it's the fans fault if a team moves because lack of ticket sales...as for Zona well they can move to a better market team no point trying to force a team to stay where they can't make money...


A's have no chance to win rn... That's not what the NHL wants
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Jan. 16 at 8:15 a.m.
#32
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Quoting: Pompadour_de_Armstrong
There is no point in the cap system in hockey if you're letting teams spend 25% or more above the soft cap for a third rounder. Big markets should be able to flex their wallets for a competitive advantage, but in a way that is not broken. Give them a small percentage of extra space available up to a hard cap, and make them pay for it. Builds parity and helps small and new markets get their feet under them. Also sends franchise values through the roof, which is the real reason billionaires buy teams. It'd also help if the league wasn't brain dead in their efforts to market the sport. Everybody is more competitive, and everybody is happy.


And they are paying 6:1 (Everyone getting paid 8 mill above the 25%, the team has to pay 48 mill)... And then add lost of draft capital

I don't think that's broken TBH...
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Jan. 16 at 5:15 p.m.
#33
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Quoting: Pompadour_de_Armstrong
They had that system already. They didn't like it.


The owners didn't like the free market system you mean...the players were loving it of course haha...
Jan. 16 at 6:45 p.m.
#34
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Quoting: TheGxForum
The owners didn't like the free market system you mean...the players were loving it of course haha...


Yeah, they didn't like spending by far the highest percentage of revenue to salaries of any North American sports league, nor did they like the fact that the teams lost a combined $96 million in 2003-04 or $123 million in 2002-03 (per Forbes). Salaries were driven by a few teams with deep pockets and were outstripping leaguewide revenues. It wasn't sustainable.

It's not a coincidence that franchise values have skyrocketed since the cap was instituted.
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Jan. 16 at 9:41 p.m.
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Quoting: TheGxForum
Nah when was the last time the team that spent the most won it all in any sport...? Besides if teams go bankrupt trying to keep up with the Joneses that's their own problem not anyone elses the faster they go bankrupt the faster someone more responsible can take over those franchises...


So your solution is to "shrink the pie"...AND...cut bigger slices for few that remain

Bold.

Could just go back to 6-team league too.
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Jan. 17 at 5:01 a.m.
#36
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Quoting: Pompadour_de_Armstrong
Yeah, they didn't like spending by far the highest percentage of revenue to salaries of any North American sports league, nor did they like the fact that the teams lost a combined $96 million in 2003-04 or $123 million in 2002-03 (per Forbes). Salaries were driven by a few teams with deep pockets and were outstripping leaguewide revenues. It wasn't sustainable.

It's not a coincidence that franchise values have skyrocketed since the cap was instituted.


Can't disagree with anything you've said there especially the franchise values skyrocketing...still rather have the free market over the controlled market...
Jan. 17 at 5:05 a.m.
#37
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Quoting: NHLfan10506
So your solution is to "shrink the pie"...AND...cut bigger slices for few that remain

Bold.

Could just go back to 6-team league too.


No...it's called free market...not magic...besides if other sports don't need hard salary caps why does hockey?
Jan. 17 at 9:08 a.m.
#38
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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.
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Jan. 17 at 9:30 a.m.
#39
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Quoting: TheGxForum
if other sports don't need hard salary caps why does hockey?


To answer this question….

They are different sports with different models.

NFL - The economics of the NFL is very different. A huge majority of their league revenue is comes from their national broadcast deals. Fans will watch any two teams play Thursday, Monday. Fans gamble, fans play fantasy. The customer in Football is more tied to the league. They want as much parity as possible since it helps the primary brand (the NFL). They have some exceptions like franchise tags. But otherwise, league keeps tight grip. Also there is only one source of talent. NCAA football. So they have tightly controlled the barrier to entry, scaled contracts, since they can.

MLB - On the flip side, MLB is a very locally driven league. They make most of their revenue by local TV deals, gate revenue and other marketing partnerships. They benefit from being a summer sport. Even if your team stinks, a day at the ballpark is always fun. There are some league-wide revenues streams, but quite minor. The result has been Yankees, Dodgers and a few others spending more in luxury tax than the poorest team puts on the field. Much of their financial advantage comes from marketing partnerships. Take Boston Red Sox, for example. They have the smallest stadium in MLB by a lot. And don’t raise ticket prices. But they have been brilliant in leveraging the brand across New England to boost revenue. It is wholly different revenue model, that would be hard to employ in NHL.

NHL - NHL is it’s own league. It has mix of league-wide and local revenue. It shares revenue equally between players and owners. To keep that in balance, they have to manage a cap and the growth of that cap each year.
Jan. 17 at 5:51 p.m.
#40
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Quoting: NHLfan10506
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.


Oh I agree with all you posted and that the owners will never go to a free market...I'm just saying that's what I'd choose anyways if I was an owner or a player and as lifetime fan...
Jan. 24 at 3:37 p.m.
#41
SvechAhoMacMakar
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The salary cap is lame the avs cant go sign svechnikov
Jan. 26 at 7:38 a.m.
#42
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It's Just a Guess
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Quoting: NHLfan10506
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.


I originally started this thread looking for answers on how to help clubs (large or small market) to be able to sign drafted players (after ELC runs out) instead of losing them because of the salary cap. My proposal would be to give cap relief (come up with a %) only to those players drafted by that team. If teams choose that option they couldn't go out and spend more money (in free agency) than their top salaried player(s)

When a team like Edmonton drafts a player like McDavid they shouldn't be penalized trying to build a team around him because of cap restraints. It's not fair to the team and definitely isn't fair to the player. Same could be said for Toronto however it's hard to feel sympathy for them when they signed Tavares for the money they did.

I don't want small market teams to go away however as much as the commissioner wants hockey in Arizona you can't force fans to support a team when there is no interest. I am a huge capitalist and free market person but for this league to survive you have to (dare I say it) spread the money around. I just threw up. Anyway, bottom line allow teams to maybe "franchise tag" certain drafted players for cap relief with restrictions in place to not out spend small market teams in free agency. Promote building teams through the draft.
Jan. 26 at 8:03 a.m.
#43
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Quoting: mactad
I originally started this thread looking for answers on how to help clubs (large or small market) to be able to sign drafted players (after ELC runs out) instead of losing them because of the salary cap. My proposal would be to give cap relief (come up with a %) only to those players drafted by that team. If teams choose that option they couldn't go out and spend more money (in free agency) than their top salaried player(s)

When a team like Edmonton drafts a player like McDavid they shouldn't be penalized trying to build a team around him because of cap restraints. It's not fair to the team and definitely isn't fair to the player. Same could be said for Toronto however it's hard to feel sympathy for them when they signed Tavares for the money they did.

I don't want small market teams to go away however as much as the commissioner wants hockey in Arizona you can't force fans to support a team when there is no interest. I am a huge capitalist and free market person but for this league to survive you have to (dare I say it) spread the money around. I just threw up. Anyway, bottom line allow teams to maybe "franchise tag" certain drafted players for cap relief with restrictions in place to not out spend small market teams in free agency. Promote building teams through the draft.


Teams are already built through the draft, if you look at how teams like Tampa, Colorado, Pittsburgh, Chicago, LA made their cup roster, basically all of their stars were drafted. Also I don’t think any Oilers fans think they’re being penalized because they have McDavid which means they have less cap space to build the team around him
 
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