Next year's (2007-08) Salary cap

[Ramius]

hey, my first post here after some lurking. Same old Ramius from TBD, just thought i'd join in over here instead of relying on OTW for my sabres fix.

 

The quesiton i have, with everyone worrying about players not wanting to sign long term, and instead wanting to "cash in" next year as UFA's, is this:

 

Will the salary cap increase as much next offseason? From what i have read, last years cap was determined rather arbitrarily, and this years cap jumped a bunch when that got the actual numbers were released. Now since the cap is tied to revenue, will the revenue for the NHL increase that much next offseason? This season attendance was way up in the NHL, so there wont be much extra revenue from that source. Also, the NHL still has no major TV contract like the NFL, so i dont see a large amount of revenue increase coming from that source either.

 

The way i see it is that the cap may only increase a little because revenues are currently close to their maximum. So if the cap doesnt increase that much in the offseason, these huge deals that players like dumont are looking for plain and simply wont be there next year. Toss in the fact that a lot fo players are going to be UFA's next season, i see a large supply of players with potentially minimal cap space available next season. People like dumont may be shocked when they arent getting insane offers like the ones handed out this offseason.

 

Any thoughts/comments/answers to my ?'s would be appreciated.

[hopeleslyobvious]

hey, my first post here after some lurking. Same old Ramius from TBD, just thought i'd join in over here instead of relying on OTW for my sabres fix.

 

The quesiton i have, with everyone worrying about players not wanting to sign long term, and instead wanting to "cash in" next year as UFA's, is this:

 

Will the salary cap increase as much next offseason? From what i have read, last years cap was determined rather arbitrarily, and this years cap jumped a bunch when that got the actual numbers were released. Now since the cap is tied to revenue, will the revenue for the NHL increase that much next offseason? This season attendance was way up in the NHL, so there wont be much extra revenue from that source. Also, the NHL still has no major TV contract like the NFL, so i dont see a large amount of revenue increase coming from that source either.

 

The way i see it is that the cap may only increase a little because revenues are currently close to their maximum. So if the cap doesnt increase that much in the offseason, these huge deals that players like dumont are looking for plain and simply wont be there next year. Toss in the fact that a lot fo players are going to be UFA's next season, i see a large supply of players with potentially minimal cap space available next season. People like dumont may be shocked when they arent getting insane offers like the ones handed out this offseason.

 

Any thoughts/comments/answers to my ?'s would be appreciated.

 

 

You're exactly right about why the cap went up so much this year. If it goes up again next year, it will probably not be nearly as much.

[Taro T]

hey, my first post here after some lurking. Same old Ramius from TBD, just thought i'd join in over here instead of relying on OTW for my sabres fix.

 

The quesiton i have, with everyone worrying about players not wanting to sign long term, and instead wanting to "cash in" next year as UFA's, is this:

 

Will the salary cap increase as much next offseason? From what i have read, last years cap was determined rather arbitrarily, and this years cap jumped a bunch when that got the actual numbers were released. Now since the cap is tied to revenue, will the revenue for the NHL increase that much next offseason? This season attendance was way up in the NHL, so there wont be much extra revenue from that source. Also, the NHL still has no major TV contract like the NFL, so i dont see a large amount of revenue increase coming from that source either.

 

The way i see it is that the cap may only increase a little because revenues are currently close to their maximum. So if the cap doesnt increase that much in the offseason, these huge deals that players like dumont are looking for plain and simply wont be there next year. Toss in the fact that a lot fo players are going to be UFA's next season, i see a large supply of players with potentially minimal cap space available next season. People like dumont may be shocked when they arent getting insane offers like the ones handed out this offseason.

 

Any thoughts/comments/answers to my ?'s would be appreciated.

My guess is that revenue will go up about 4-5% and the cap as well (figuring an increase of the midpoint of the salary range of ~$1.5-2MM) so the '07-'08 cap would be betweem $46-46.5MM. My 4-5% is a WAG, but it's based on NBC knowing better what their ratings will be and (hopefully) getting more $'s and an expectation that leaguewide ticket prices (and merchandise and concession, etc.) will be up slightly. Remember also, that if revenues go up ~5% to $2.2B, then the players %age increases to 55% vs. the current 54%. (Until leaguewide revenues hit $2.7B, the players share of the pie will increase up to 57%, so the Cap will go up a bit quicker than revenues for the next couple of years.)

 

There will still be huge salaries being awarded to players, but that will be limited to the truly elite players IMHO. Guys like Dumont, who are above average but not stars by any stretch of the imagination, will need to either put up huge numbers in their contract year or have John Davidson or Mike Milbury fall in love with them to get the big bucks, again IMHO.

 

I expect to see a landscape within 2-3 years where the true stars make killer money and the rest of the players fight for the remaining scraps. If enough teams are successful using a model similar to the Sabres model, that may not happen, but there are just too many Milbury's in the league for me to believe they will collectively "get it".

[X. Benedict]

hey, my first post here after some lurking. Same old Ramius from TBD, just thought i'd join in over here instead of relying on OTW for my sabres fix.

 

The quesiton i have, with everyone worrying about players not wanting to sign long term, and instead wanting to "cash in" next year as UFA's, is this:

 

Will the salary cap increase as much next offseason? From what i have read, last years cap was determined rather arbitrarily, and this years cap jumped a bunch when that got the actual numbers were released. Now since the cap is tied to revenue, will the revenue for the NHL increase that much next offseason? This season attendance was way up in the NHL, so there wont be much extra revenue from that source. Also, the NHL still has no major TV contract like the NFL, so i dont see a large amount of revenue increase coming from that source either.

 

The way i see it is that the cap may only increase a little because revenues are currently close to their maximum. So if the cap doesnt increase that much in the offseason, these huge deals that players like dumont are looking for plain and simply wont be there next year. Toss in the fact that a lot fo players are going to be UFA's next season, i see a large supply of players with potentially minimal cap space available next season. People like dumont may be shocked when they arent getting insane offers like the ones handed out this offseason.

 

Any thoughts/comments/answers to my ?'s would be appreciated.

 

 

Hey, good to see you.

This is the little that I understand.

The players are guaranteed 54% of all hockey related revenue, so the cap moves as revenues increase, furthermore if revenues cross certain thresholds then the percentage goes up.

 

If league revenue gets as high as 2.7 billion then the players get something like 57%.

 

Because the owners were very worried about cost certainty - revenues will be constantly evaluated, and player salaries potentially held in escrow until it is determined that the % is right.

 

I actually don't think that revenues will go up that dramatically next year.

[Saber61]

hmmm 46 million dollar cap... it seems almost as if were creeping up on where we were before this whole mess... i mean without the 70 and 80 million dollar teams... but still it doesn't look good for smaller teams that can't even afford to pay up to 39 million... such as buffalo.

[Ramius]

hmmm 46 million dollar cap... it seems almost as if were creeping up on where we were before this whole mess... i mean without the 70 and 80 million dollar teams... but still it doesn't look good for smaller teams that can't even afford to pay up to 39 million... such as buffalo.

 

well, we have a 46 million cap. If a lot of teams spend to or near the limit of the cap this season, and it only increases to 48 million next season, they are screwed. Players like Dumont who want to "cash in" are going to be seeing a lot lower offers than this year.

 

I am under the assumption that unless the NHL picks up a huge TV contract, the cap wont increase. And as stated before, that little money will be thrown at the stars who will see the 7-10 mil per season deals, while the rest of the crows will be offered a lot lower, due to cap restraints.