Speculation: Brian Burke: Cap might be $40 million next season

[tmlms13]

With the salary cap being directly related to league revenue, I don't think Burke is that far off in his estimate.

Unless they force the players to take a 50% pay cut there is not a chance in hell the cap goes down to 40. And they players will strike if they try that.

 

[WolfBlitzer]

He couldn't know i'm just referring to the bad luck.


Actually Nylander exceeded my expectations this year and you make a great point.

Nylander is a great contract. Don't forget 6.9 is for all his prime years. He's not a 28 year-old signing for 6 -7 years. In fact, if you want to move him GMs will line-up for him. The fact majority of his cash is paid in the 1st 2 years, small markets teams will be excited to bid on him as well (That's where big singing bonuses help the Leafs).

 

[Golden_Jet]

I've run the math. If no further games are played, the league revenue drops between 15.6% to 19.9% from last year. The lowest it could go, is $65 million.. You aren't too far off with the escrow taken into account, but Burke is in fantasy land.

That’s for the 19/20 season, so players owe that back in escrow for season just played, so 18% using your numbers, plus the usual 10-12% the player pay in escrow off each cheque, brings you to about 30% owed for 19/20 season,

20/21 season revenues will be much lower as well, even if rinks let some fans in, a lot won’t go to a crowded stadium, or empty stadiums might be how they start.

 

[JT AM da real deal]

That’s for the 19/20 season, so players owe that back in escrow for season just played, so 18% using your numbers, plus the usual 10-12% the player pay in escrow off each cheque, brings you to about 30% owed for 19/20 season,

20/21 season revenues will be much lower as well, even if rinks let some fans in, a lot won’t go to a crowded stadium, or empty stadiums might be how they start.

That's why I think you will see heavily discounted tickets for fans willing to take on the viewing live risk. I am assuming 1 out of 2 season ticket holders will keep tickets and not park them for a year. Whatever that % is is likely what da available tickets will be for games. Some of those hit da after market. and my guess is folks will be pleased if they can recover their spend rather than making a fortune off those tickets. But who knows? Maybe da pent up demand will be huge.

 

[Polaris1010]

https://nypost.com/2020/05/06/mlb-ramping-up-plans-for-best-case-july-start-to-2020-season/

 

[Polaris1010]

Gate receipts is 40% of NHL revenue, a safe assumption to make. It's probably slightly more.

 

[hullsy47]

Unless they force the players to take a 50% pay cut there is not a chance in hell the cap goes down to 40. And they players will strike if they try that.

Players and owners need each other
But the league is in trouble if we have a second wave

 

[rent free]

Gate receipts is 40% of NHL revenue, a safe assumption to make. It's probably slightly more.

it's been less than 40 for 5 straight seasons...

 

[Golden_Jet]

So if They set escrow at 35% for 20/21 and it works out fairly accurate.
Does this mean the cap will have to drop to 55 million or so for 21/22; as that would be what HRR would equate too, and that’s how they do it now.

Or maybe 21/22 is a salary rollback , as it is a new CBA for that year.

You can’t have multiple years of 35% escrow I feel.

 

[rent free]

So if They set escrow at 35% for 20/21 and it works out fairly accurate.
Does this mean the cap will have to drop to 55 million or so for 21/22; as that would be what HRR would equate too, and that’s how they do it now.

Or maybe 21/22 is a salary rollback , as it is a new CBA for that year.

You can’t have multiple years of 35% escrow I feel.

the cap will be flat for at least 2 seasons. work out your escrow math around that

 

[Polaris1010]

it's been less than 40 for 5 straight seasons...

That graphic was solely gate receipts.

What monies the owners pocketed due to the sales from the concessions stands or the rentals of private boxes, were not included as I understand it.

 

[Polaris1010]

Just thought of something.

Anyone know how much the sushi costs at the ACC or now named the Scotia Bank place?

Those guys in suits in those $400 platinum seats, how much they paying for their sushi?

 

[ACC1224]

Just thought of something.

Anyone know how much the sushi costs at the ACC or now named the Scotia Bank place?

Those guys in suits in those $400 platinum seats, how much they paying for their sushi?

The price of food is the same all over the building.

 

[notDatsyuk]

That may be the dumbest statement I've heard from a non-politician in years, but considering the source, not surprising.

 

[deletethis]

Just think if technically Burke were right that the shutdown causes revenues to be lost so much that the calculation of the cap was affected hugely. There's no way that the NHL in concert with the NHLPA wouldn't amend the CBA on the fly to temporarily override the cap calculation for the summer of 2020.

 

[JT AM da real deal]

Gate receipts is 40% of NHL revenue, a safe assumption to make. It's probably slightly more.

The issue you have to consider is everything else that comes from da gate. The food, beer/wine, the merch, some advert and da sponsorships. With media at 20% +/- based on Daly's numbers. That number is like 30-40%. I don't believe Scotia drops that coin into MLSE without fans in da stands. Likely it is a much smaller number.
Hopefully Bettman can land his long promised US national TV deal like NBA and NFL and hockey can elevate past gates.

 

[ottomaddox]

Unless they force the players to take a 50% pay cut there is not a chance in hell the cap goes down to 40. And they players will strike if they try that.

Think of the darkest scenarios. Then combine the darkness with a world-wide pandemic. How are players going to get paid if they have no league to return to or a franchise to play for?

 

[Polaris1010]

MLB projects $640K per game loss with no fans at baseball games

 

[Polaris1010]

Very long article.

A Deep Dive Into MLB’s Financial Losses For The 2020 Season

 

[Moonman]

The MLB players better wake up to reality quick. If they don't look at this as an existential threat to the game they could be in for a very rude awakening.

 

[Mickey Marner]

The MLB players better wake up to reality quick. If they don't look at this as an existential threat to the game they could be in for a very rude awakening.

Yep. Since 2007 baseball attendance has fallen by about 10 million and league payroll has increased by about 1.5 billion. Baseball has been losing ground for years and I doubt it recovers from this pandemic.

 

[IranCondraAffair]

I don't think he's wrong. Next season, the cap could realistically be set at 40M and escrow might be near 0%. The league/players have decided to do a 81.5M cap and just take a massive escrow loss. Which is fine, but eventually, if revenues don't recover, I think long term, he might be right that they're going to have to drop the cap because it makes no sense to have a 80M cap and only pay players 50% of their contract they sign.

 

[JT AM da real deal]

I don't think he's wrong. Next season, the cap could realistically be set at 40M and escrow might be near 0%. The league/players have decided to do a 81.5M cap and just take a massive escrow loss. Which is fine, but eventually, if revenues don't recover, I think long term, he might be right that they're going to have to drop the cap because it makes no sense to have a 80M cap and only pay players 50% of their contract they sign.

The negotiations are already well underway. The league is talking to players about a 35% escrow on a 81.5M CAP. Da players are trying to get it lowered. We will see where things end up. No one can know because of COVID there are too many unknown variables. And the true up next summer will be a real spit ball. Who knows maybe da players will have to pay back for first time ever. But it will be worse than this years 14% escrow plus an 8 day salary forfeit if league has to pay back some of its TV/media contracts. So I think everyone will get on board with some plan to finish up and award da Cup.

 

[Ignatius Reilly]

The league has lost (and continues to lose) a fortune with the shutdown.

I can't guess the numbers, but the cap will have to go down - that's just math. 50% seems high, but who knows what next season will look like? It's the downfall of a gate driven league.

If the players think they are somehow immune from all this, they're dreaming. Like so many other businesses it's going to hurt. Really hurt. But it will be less damaging if everyone can agree to take a haircut and share that pain.

Not sure the NHL and NHLPA are really able to do that - they see each others as adversaries too often, instead of partners in a terrific business that pays really well and is a life's dream for most.

 

[JT AM da real deal]

The league has lost (and continues to lose) a fortune with the shutdown.

I can't guess the numbers, but the cap will have to go down - that's just math. 50% seems high, but who knows what next season will look like? It's the downfall of a gate driven league.

If the players think they are somehow immune from all this, they're dreaming. Like so many other businesses it's going to hurt. Really hurt. But it will be less damaging if everyone can agree to take a haircut and share that pain.

Not sure the NHL and NHLPA are really able to do that - they see each others as adversaries too often, instead of partners in a terrific business that pays really well and is a life's dream for most.

If market forces prevailed then the conflict would stop. We need a better system to define HRR which is far broader then current one. There are too many loopholes for da owners to exclude revenues. Scotia should not be able to funnel $$$ for advert/sponsorship which avoids HRR. Also too many other GTA companies doing same. When people say they split revenues that is biggest joke of all. Da players split what owners decide they split.