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Is a CBA standstill on the way?

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With CBA talks dragging, Commissioner Gary Bettman is under fire from angry fans who see a lockout coming. (Jeanine Leech/Icon SMI)

By Stu Hackel

The Thursday meeting between NHL owners and players was a short one, only 90 minutes, but it seems that’s all that was needed. An impending stalemate in CBA negotiations (discussed here in Wednesday’s post) looms with each side’s position in danger of ossifying. It’s hardly unanticipated; you had to know that amidst all the talk about being focused on reaching an agreement, there’s long been a sense that each side would dig in its heels over some fundamental issue and those heels now seem to be sinking into the earth.

This isn’t to say that the sides aren’t trying to negotiate a deal at the moment. They’re still talking and plan to resume on Tuesday. According to NHL Commissioner Gary Bettman in his remarks after the most recent discussion, the league had tried to craft a revised position of its own — incorporating elements of the NHLPA’s “alternate proposal” that offers the owners’ some concessions on player salaries — that would be the basis for whittling down the difference between the sides. But Bettman said the NHLPA didn’t have much “receptivity” to what the league devised, despite a couple of attempts to engage the union on it. Then the players presented the owners with the remaining parts of their proposal, those dealing with the NHLPA’s views on contract issues: free agency, salary arbitration, contract length and the like, things the NHL wants to restrict. The owners didn’t much like what they heard. “The union,” Bettman said (video), “is looking for a system that has more flexibility and we’re looking for a system that has less flexibility.

“The bigger point, I think, we made today goes to the fact that whether or not we are talking about the contract or system issues or we’re talking about revenue sharing, it’s clear that we’re at a point where it’s going to be very difficult to move this process along until we deal with the fundamental economic issues. And certainly as it relates to the fundamental economic issue, we are far apart, both in terms of magnitude and structure. And that’s something we’re trying to get a handle on.”

What is that fundamental economic issue? Bettman laid it out rather plainly when later addressing questions:

“We believe that we are paying (the players) more than we should be,” he said. And that comes down to defining Hockey Related Revenue and what the players’ slice would be under the salary cap.

“The players have done very well under this deal,” Bettman said. “The average salary has gone from a million four-fifty to two million four-fifty. I think given their druthers — (as) they’ve said publicly — they’d rather keep playing under this deal…My sense is they prefer to keep things the way they are and that kind of slows up the process.”

“Everybody understands that employers would always like to pay less,” countered NHLPA Executive Director Don Fehr during his remarks to the media. “That’s not a surprise to anybody — it’s disappointing sometimes — but it’s not a surprise….From the players’ standpoint, they want a fair agreement, they want one that is equitable, they want one that recognizes their contribution.”

Bettman went on to say that in Thursday’s discussion, Fehr acknowledged that things aren’t going to move forward until that fundamental issue is dealt with — which doesn’t mean they’ll start to agree on what the players’ share of HRR should be, just that Bettman believes that question has to be answered before all else, that it’s the central issue of the next CBA as he sees it, and both sides will prepare over the weekend for that discussion.

Do the players share that view? When Fehr spoke to the media afterward…

…he said, “Our belief is that — and I think they share what I’m about to say by the way, even if we come at it from different perspectives — is that when you tie together the core economic issues in terms of the cap numbers, when you add to that the revenue sharing issues, when you add to that the player contracting issues, we don’t separate them, and we have different approaches as to what makes sense and what to tackle first. Having said that, they all have to be agreed upon or it’s not going to be agreed upon. And so when we say we’re going to focus on core economic issues next week, I expect that sooner or later we’ll get to all of those. Exactly what’s going to come up first, I don’t know.”

He added that the preparations he believes are in order for next week are continued discussions with his constituents, the players, “about how things look and what we might be able to do and all the rest of it. And sometimes the process is better served — rather than by meeting and continuing the discussions — by taking time to think and consider, to ponder, to talk to your constituents and then to come back. And the time that’s going to be taken between now and then is hopefully going to be taken by both sides to do that. Whether it will be productive remains to be seen.”

All of this means that if Mr. Bettman wants a resolution of the lowered salary cap issue first and has asked Mr. Fehr to ask his players if they are interested in settling next week for, lets’ say, 46 percent or 43 percent or even the canard of partnership and the myth of an equal 50-50 split of HRR, Mr. Fehr will discuss it with them, starting immediately with another NHLPA regional meeting scheduled for Toronto. You can pretty much figure out what their answer will be.

Well, hockey fans, like it or not, if you’re paying attention, you’re getting a pretty good education about the joys collective bargaining techniques. But on Twitter around mid-day Thursday, fans felt they were getting something else — like a royal screwing, especially after they heard of Bettman’s response to one questioner who asked if the league’s excellent post-lockout economic growth gave him confidence that the owners could lock out the players again. Bettman restated that he was focused on a settlement, didn’t want a work stoppage and then added, “We recovered last time because we have the world’s greatest fans.”

Seen as disingenuous by these “greatest fans” to whom he would deny hockey through a lockout, Bettman’s words prompted a good deal of Twitter outrage and calls for some sort of fan protest. We’ll have to monitor that to see if anything really comes of it. As Bruce Dowbiggin of The Globe and Mail reported on Monday, there are already a few anti-lockout websites gearing up: “NoHockeyLockout.com (‘Giving the Fans a voice to save our sport!’) and NHLexpertpicks.com are among the sites hammering the issue. The tone is anti-NHL,” he wrote.

Of course, a lockout doesn’t just mean no work for the players. The hardest hit victims wouldn’t be those not making tons of money as players or owners, but those who make far less working for the teams, in the arenas, and in businesses connected with NHL games. Eric Francis of The Calgary Herald reported on Thursday that Flames employees may be in line for salary cuts if the players are locked out. Earlier this month, Geoff Kirbyson of The Winnipeg Free Press wrote about the plight of businesses near the MTS Centre that would suffer if the Jets don’t play this fall. There are hundreds of people connected with the TV and radio rights-holders, local and national, who are paid by the game and would not get checks. I suppose they get classified as collateral damage in all this.

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  • Published On Aug 23, 2012
  • 10 comments
    Not
    Not

    WHA.  Didn't do so bad, but they started with too big a bite to be ablel to chew it thoroughly.  The players should consider a series of exhibition games, maybe with an all-star atmosphere, or winter classic atmosphere - no fights or big hits, just fun and players showing off the incredible skill they have.  Most people abhor the violence, and blame that on no-talent players trying to make a place in the league.  If the players really are a union, then they should set aside that stuff and showcase what they can do, and bring along enough low-talent personnel to fill all the spaces...or better yet...just have fewer players in their showcase.  Sell what they do as being something you wouldn't be concerned about bringing children to.

     

    So, Boss1, the Winter Classic is what the players should do.  Rent Michigan Stadium, and put on an all-star game or maybe a few.  Michigan loves hockey.  Rent Penn State University's stadium, they could use the money.  Set up  below the CNN tower in Toronto.  Hold a draft, (or let the fans do it "fantasy" style - interactivity at it's best) and set up "original 6" teams (in name only) and play a tournament that lasts Dec-Feb in various stadiums across America and Canada.  They would be exhibition games, so they don't have to occur in the original 6 cities.  Or go to small venues and play exhibition games, those places would love to host NHL players.

     

    The players would make money, the owners wouldn't and we'd all get to see how the rich are raping every other life form on the planet.  Maybe could even wake up the rest of the economy about bankers, wall street, politicians and start to hammer that group of slime-balls.

     

    The OWNERS are at fault here.  They are nuts.  They paid Mario L so much he took over the team.  How is that NOT nuts?  Granted, he was a great player, but giving him the team?  Freaky weird.

    710squirrel
    710squirrel

    What's really bad about this is that some of the hard hit cities in the midwest like Detroit are going to suffer greatly if there is another lockout.  Detroit is already one of the hardest hit cities in the nation due to the economy and losing out on that associated revenue of restaurants, bars, etc will the town even more.  

    Henry R1
    Henry R1

    I think the players are over paid, but having said that, owners complain, then do every thing they can to get by the cap. When a little better then average players are offered $4-6 million a year, how can owners complain that salaries are to high. 

    Boss1
    Boss1

    Stu,

    This might seem like a silly question. Why don't the players make up their own league, since they are the product? With available credit, attorneys, planners etc available they could build their own "league" and everything that goes with it.

    Along those same lines, with so many former players now being in management or even ownership have those individuals made any difference in how the process is unfolding? One would think they would me more sympathetic and understanding to the two sides differences.

    Swampdragon
    Swampdragon

    Bettman is making Fehr look sympathetic his arrogance when dealing with the media is baffling when I watch Fehr he's Mr. Everyman (which I know from previously is not the case) and the fans who sided more with the owners last time are almost universally on the players side this time Well I predict an American Thanksgiving start up. Actually Black Friday the owners aren't arrogant enough to start on what is NFL territory are they ?!?!?!

    KenKing
    KenKing

    In 1977, Marcel Dionne and Phil Esposito were the two highest paid players in the league.  They made $320K and $325K respectively. That translates to roughly $1,150,000 or so in 2011 dollars.  Give or take, that was about 15 times the amount earned by the average schmo who bought hockey tickets. Today, the average NHL player earns more than twice that.  The Crosby's and Ovechkins earn $8 million or more.  Assuming that same  average schmo makes about $50K, that means they earn  160 times what that guy earns. Surely there is something wrong with the picture.  That same year, Guy Lafleur - in the middle of a run of Stanley Cups, earned $150K. Bryan Trottier and Mike Bossy - the cornerstones of the next dynasty in line - made $90K and $50K respectively.  Those guys led great lives and drove really nice cars. I know, because I delivered Trottier and Bossy their cars.

     

    What the NHLPA ( and all sports unions) seem to miss is that their contracts are guaranteed. If they play like dirt, they get paid full. But nobody pays to see them play like dirt. And nobody buys hot dogs or soda or beer. And local advertisers stop paying to be in the programs.

     

    That is compounded by all these guys who demand trades, because they want brighter lights, or they are in love with a Kardashian or whatever reason. But the team passed on great blueliners in three successive drafts, because they had a cornerstone. Now there is a huge whole in their defense, or their best scorer is gone. The player makes his salary the next year. The team sees ticket sales drop by 5%.

     

    The list of factors goes on and on. What never changes is that the players have guaranteed contracts and the teams have no guarantee of income, outside a 3 or 4 year meager TV contract. They are facing entirely different economic realities.  But Fehr has already won the war, if he has the local waitresses and bartenders convinced that the players are downtrodden and almost destitute. Waitresses and parking lot attendants made squat in 1978 and make squat now.  Espo made probably 30 times what their 1978 counterparts made waiting tables. Crosby makes 320 times what they make.  That is a factor of 10!!!!!!! And it is the owners who are blamed? Give me a break.

    PatrickVecchio
    PatrickVecchio

    Stu, felixwas here. Bravo for your point at the end about how lots of people who have nothing to do with hockey are going to lose out on "hockey-related revenue" during the lockout: parking lot owners, the parking attendants who rely on tips, restaurant owners, bartenders, servers who rely on tips to make a living, arena workers of all persuasions, including front-office folks—the list could go on and on. Everyone in those groups will suffer much more than multi-millionaires.

     

    Here's hoping late August's fan backlash turns into empty arena seats and low TV ratings whenever the games resume. After all, the age of shotblocking and padded-from-here-to-hell goalies makes for a pretty dull show.

    Stu Hackel
    Stu Hackel moderator

     @Boss1 Boss (you're not Bruce Springsteen, are you?), It's not a silly question, and I seem to recall in the '94 lockout that the players attempted to stage some exhibition games of their own and pulled off a few. And there was talk of a players' league around that time, too, as I vaguely remember, but nothing came of it. The only real attempt at forming an alternative to the NHL at the time still involved owners and that was the brief flirtation the re-organized IHL engaged in around the time of the 94 lockout, the "I" trying to go from being a minor pro league to something closer to the NHL in caliber, placing franchises in NHL markets. It didn't last long and ultimately fizzled.

     

    But for the players today to form their own league, you have to consider some essential business realities. And the first and foremost of them is -- where would they play? If the players abandoned the NHL, they'd have a hard time coming up with 30 suitable arenas in the major markets with the desired capacity to get the number of fans that would pay them the kind of money they are used to being paid, or something even approaching it. I can't imagine the owners being of a mind to rent them the arenas in which NHL teams currently play. They can have all the credit, attorneys planners, etc available you speak of, but the players would have to also get into the arena business to do that and that's a crucial and mammoth complicating element in all this. Even if they cut down to 20 teams or 15 teams, I don't know how they'd find adequate buildings in the major cities that would guarantee them the sort of fan base they have now -- and remember, if you cut down on cities, you cut down on your national TV market, losing a big source of revenue, AND you have to tell a lot of players they don't have jobs in the new league.

     

    That right there is a seriously inhibiting factor to the players forming a new league of their own, unless they were prepared for a massive reduction in their compensation. No, it seems to me that the best available solution remains the current one, with owners on one side of the equation and the players on the other. They aren't going to see eye-to-eye on things all the time and that's to be expected; they have different interests in their business relationship. But no one in any pro sport has ever come up with a workable alternate model that cuts out the owners. I know one was attempted in baseball in the late 19th century but it only lasted one season, and it was formed by National League players in reaction to what they felt were exploitive practices of the NL owners. It was an outgrowth of their players' union, but from what I remember, it still had owners and they didn't believe they could make a go of it after one year and folded.

     

    Maybe some day, someone will figure out a way to make a player's league work in some pro sport, but it's not happening now or in the forseeable future.

     

    Thanks for your comment.

    Stu Hackel
    Stu Hackel moderator

     @KenKing Ken, there is much truth in what you write, but let's not shed any tears for ownership either, who have seen their franchise values soar to unprecedented levels, as I wrote about in my post on revenue sharing. http://nhl-red-light.si.com/2012/08/22/breaking-it-down-why-nhl-owners-oppose-revenue-sharing/ A top player may have made around $100,000 in the 1970s, and that's nothing compared to today, but an expansion franchise was worth $6 million in 1970 (up from $2 million for an expansion team just four years earlier) and when Nashville and Minnesota joined in 1997, it was $80 million -- and the most expensive franchises sold to date are astronomically higher than that (the Canadiens over $570 million and the 3/4 share of MLSE that just sold went for $1.32 billion). So everyone in the game is doing better.

     

    In my view, the best way to evaluate what this negotiation is about has to do with two parties, each with certain interests they want to protect and advance, if possible. They each have the right to do that under our system of collective bargaining.  I don't see it as good guy vs. bad guy, as one side's position being morally superior to the other. Frankly, when it comes to the kind of money everyone makes in pro sports, I can't personally relate to either players or owners. I do think Fehr is right when he says that it's the players that fans pay to see, not the owners -- the players are the show. And it's also correct that the owners take the business "risks" (such as they are when almost every team that changes hands sells at a healthy profit) and they want to minimize those risks.

     

    The problem is that each of these parties have different interests and so they have an adversarial relationship  when it comes to the conditions of the players' employment. Unless you are an owner or a player and will be directly affected by the outcome of the negotiations, I don't see the point of assigning any blame here. And please don't say that higher salaries mean higher ticket prices: Ticket prices are set by what the customers will pay for them, not by salaries, and the promises that the owners made in 2004 that a salary cap would mean lower salaries and hence lower ticket prices have hardly come true.

     

    The people I relate to in this, as I pointed out in the post, are those whose livelihoods are tangential to the games. As a former NHL employee, I've been one of them and, in a sense, being in the media, I still am. But even though they'd be the biggest victims of a lockout,  I don't see the virtue -- or the point -- in making comparisons between what their salaries might be and what the players make or the owners make. The only real point is that these people want to work and with a lockout threatened, they are at risk. Who each of them might blame for that is their own business, but it has no bearing whatsoever on the negotiations. Like it or not, the players and owners are concerned with their own interests and, as I said above, each of the sides in these talks has every right to try to defend and advance their interests, as long as they do it legally.

     

    Thanks for your comment.

    Stu Hackel
    Stu Hackel moderator

     @PatrickVecchio Hi Felix. Good to hear from you and thanks for your comment. Well, before we all storm the barricades, or not turn the turnstiles, let's see what happens come Sept. 15 and beyond. It ain't a lockout just yet.