CBA analysis, where do we go from here? The potential loss of another season.

So here we are, another day passes with no future talks scheduled. How did things get so messy, so fast and where do we go from here?

Basically the smaller market teams are making zero profit or losing money or going bankrupt.  So who is going to pay for these toxic teams to stay afloat and not turn into an Atlanta Thrashers or Phoenix Coyotes. The owners want the players to endure this burden but the players don’t think it’s entirely their burden to stomach. Here is what has been proposed by both sides so far:

NHL: A salary rollback of 12% bringing the salary cap down to around 62 million from it’s current 70.2 million cap that would have been in place next year, if the CBA didn’t expire in two weeks. They also proposed a revenue sharing increase from 150 million to 190 million according to Stu Hackel of SI.com.

NHLPA: They are willing to give up some cash as long as it goes into a fund that will be allocated to the struggling teams.  They also want the NHL to increase its revenue sharing to 250 million from its current 150 million. Also, they want specific plans on each struggling team that is controlled by the league. They hope this can get the league out of the mess that seems as old as the expansion era.

So neither side really wants to pay for these clubs that are slumping. Hypothetically, say you owned the Toronto Maple Leafs. Would you put your original six reputation, nostalgia and all you’ve built in the last 95 years on the line just to keep the Nashville Predators afloat? I know I wouldn’t.

On the other hand, say you’re a player who has watched NHL revenues grow significantly over the last 7 years since the lockout. A very small percentage of this revenue growth has gone to the struggling teams, why is this? Because the last CBA that the owners jammed down the players’ throats was not structured for the long term. The salary cap with its growth linked to league revenues was no answer for these struggling clubs, it was just an immediate fix. Would you trust the NHL to put another immediate fix on a larger problem? I know I wouldn’t.

Now that you see both sides to the argument that has unfolded over the last few months, I want to explain how in the last 7 years, you can see why the players are a little reluctant to cave.

During the current CBA, owners have been signing players to contracts regardless of their financial situation. Why is this? It’s because teams are worth a lot more money than they are losing.  The bank still sees them as being worth hundreds of millions of dollars so who cares if they lost 5 million last season?

Just look at the Minnesota Wild.  They signed the two major free agents of the offseason to monster contracts, did you know in 2011 they had operating income of about -6 million according to Forbes? No one is twisting their arm to dish out money they don’t have, so why should the players pay more to the Minnesota Wild via a salary roll back?

Unfortunately, the players had to cave during the last lockout because they needed to pay their bills and couldn’t wait any longer. The owners knew this would happen because they have other investments and deeper pockets than any one player does. The REAL unfortunate thing about the current CBA is that it DOESN’T work. So why should players jump at the chance to sign a new CBA that is championed in most aspects by the NHL once again?

The league wanted a salary cap to keep teams competitive and control the economics of the league. It worked to keep teams competitive but it did not stabilize them. The league doesn’t have a very good economic track record, I don’t blame the players union for trying to fix the problem rather than delaying it once again.  At least they are open to discussing other avenues and different ways to achieve what the NHL is looking for in a quick fix salary rollback.

The NHL won’t even listen to the NHLPA unless they start off by taking a significant rollback in year one, this seems a little childish since the NHL played a big part in this mess to begin with.

The economic scheme needs to change and the NHL is too stubborn to even listen to different ideas. They simply want the percentage of hockey related revenue where they want it and the owners profits to stay where they are.  The problem is the NHLPA is as united as ever and definitely tighter than they were 7 years ago.  Here’s what Scott Burnside had to say from espn.com:

"This is a group of players that, at this early juncture, looks to have considerably more resolve than the group that cannibalized itself early on in the fall of 2004 before the 2004-05 season was lost. If they keep that resolve, then maybe they can outwait an ownership group that has shown it has the stomach for the unthinkable when it comes to tossing away an entire season."

A lot of fans and writers think that the players have a chance to get at least some of what they want because they have the Winter Classic in their back pockets.  Do you think the league will let the Winter Classic go by without giving in just a little bit to get a deal done?

Here’s what I think.  The owners have deeper pockets than the players, and unfortunately for the fans, this is a business.  So we might be in for a hockeyless winter.