So these are the spoils of victory.
Weak franchises teetering on the brink. Strong franchises unhappily pouring good money after bad. A salary management system in which payrolls increase even for teams that have barely benefited from the revenue streams that push the numbers ever higher. Some extremely grumpy owners at both ends of the spectrum.
Think maybe Gary Bettman would like to take a mulligan right now, and start all over?
In 2004-05, the NHL's owners played chicken with their players and the union that represented them and won, unequivocally.
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Perhaps you remember the story: The fight-to-the-finish hockey guys losing their nerve in the face of a brilliantly conceived propaganda campaign, their leadership divided, the night of the long knives, the final capitulation, and so on.
Bettman couldn't manage to save his great asset, Ted Saskin, from his own shenanigans, but other than that he couldn't really have asked for more - a blank page on which to redefine the NHL's business model according to his employers' wishes. The union might still be smart enough to hide a few poison pills in a new collective agreement, but any real leverage the players enjoyed evaporated the minute they demonstrated they didn't have the stomach for the fight.
"Cost certainty" had been Bettman's mantra during the lockout - and along the way, the commissioner had also suggested, perhaps disingenuously, that he was fighting the battle for ticket affordability and to protect the interests of small-market Canadian franchises. He even got a standing ovation in Edmonton on the last point, though the real emotion in the air was anti-"greedy" player, and certainly anti-union.
What the crowd in Alberta couldn't have imagined was that four years later, their home team would be helping to prop up the Nashville Predators and Florida Panthers and similar shinny basket cases, or that the six Canadian franchises in total would dump $50-million last season into hockey's black hole.
In return for all of their trouble, for an entire lost season, the owners wound up with a salary cap-and-floor system fixed to a percentage of revenues, the kind of arrangement that can work beautifully in a league where the bulk of the money is shared equally, where league-wide television and sponsorship deals are the No. 1 economic engine (the NFL, for instance, though that's less true now than it once was). But that kind of system is a whole lot more problematic in a league like the NHL, where there are wide revenue discrepancies among franchises.
Limited revenue sharing was added to the mix to try and balance the haves and have-nots, though the NHL has been loath to provide details as to how it actually works. Certainly the redistribution of wealth was sold as a temporary fix to help needy teams get back on their feet (like the old Canadian Assistance Program), when in fact it now looks very much like a permanent welfare roll.
The weak franchises have to hit targets to qualify, and there's a time limit - but what's going to happen when you start disconnecting them from life support?
Perhaps the owners couldn't have anticipated the soaring Canadian dollar, which - as the teams on this side of the border bounced back instantly from the work stoppage - pushed league revenues and therefore player salaries higher, to the point where many teams struggle (and fail) to reach profitability even while paying the minimum.
What they absolutely should have anticipated was that teams that had failed to sell hockey in non-traditional markets under the old system would continue to fail under the new system.
That's because the issue was never competitive imbalance, as Bettman maintained over and over again. Under previous contracts, which gave teams control over players' most productive years, free spending franchises like the New York Rangers missed the playoffs for long stretches, the wealthy Maple Leafs continued to wander the desert and low revenue teams competed for the Stanley Cup.
The issue was that markets that were products of greed-driven expansion simply weren't going to embrace the product. And since Bettman had promised the owners still more expansion (you can find the projected revenue as a line item in the presentation Boots Del Biaggio was making to potential investors in Nashville), there would be no real restructuring, no letting nature take its course through bankruptcy or measured contraction, lest it shake the house of cards.
The Canadian dollar appears to be sinking now (perhaps not back to where it once was, but enough to tamp down salary inflation), which is good news for Phoenix, not such good news for Edmonton or Ottawa. There's every possibility that, coupled with the larger economic downturn, the cap will be pushed lower for next year.
It can adjust. But what's broken about the NHL, this system can't fix.
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