NHL lockout a numbers game

Joe MacIntyre
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It has become a numbers game these days for the NHL and its players as the lockout is headed to Week 8.

As we all know the main issue is money, and just how to divide the $3.3 billion in annual league revenue. A current 57-per-cent player/43-per-cent owner split needs to get to 50/50, or we will not have NHL hockey.

If there was such an item as a million-dollar bill, it would mean that each side has 1,650 of those bills, which represents an even 50/50 split of that $3.3 billion in revenue.

According to the website Cap Geek.com, the 30 NHL teams have 1,761 of those bills committed to player salaries for the 2012-13 season, and that is not including performance bonuses. Even at a 50/50 split, the players were slated to receive $111 million more in the coming year than the split would call for.

That is where the problem is as the players are willing to eventually get to an even split, but want current contracts honoured. It is not hard to see that the NHL does not have the revenues to pay these huge salaries, which have become a real drag on total revenues.

The teams still have all the other expenses of salaries, buildings, travel, etc., etc., and that is why a lot of teams will lose less money by not playing. 

By comparison

By comparison, when one looks at the revenues of one of Canada's largest supermarkets, we come to realize that the NHL is not as big as one may think.

To get some answers I asked local investment advisor Jeff McLellan to help with the numbers. McLellan, a 25-year veteran in the insurance and investment fields, tells me that this company has revenues of almost $3.9 billion per quarter -- that is more revenue in three months than the NHL has in one year.

McLellan says that the top-paid employee, before he recently stepped down, had an annual salary of just over $1 million and almost $4.8 million with pension, bonuses, etc.

This individual was the only million-dollar salary in the company, and the top five executives combined make just over $3 million. That is in a company that has more than four times the annual revenues than the NHL has.

The NHL has at least 50 players making $6.1 million or more, and combined those 50 make over $380 million. We read this week that Murray Harbour's Brad Richards just received a payout from last year's escrow account, which is an eight-per-cent deduction from his annual salary. He received almost $1 million.

Can you imagine having eight-per-cent deducted as a payroll deduction going to a bond or something, and being a millionaire after one year?

Do you think NHL players are overpaid?

In the end, the owners will get what they are after. It is not going to be as good for the players, and obviously they can afford to take a huge hit. They should realize the longer this goes, the bigger hit they will take, and the more power the owners will have. 

World Series

The World Series has come and gone, and unless you were a fan of the San Francisco Giants it was not much of a Fall Classic. The four-game Giants’ sweep over the Detroit Tigers had one of the lowest television ratings in recent memory, and left Tiger fans shaking their heads.

It was as one-sided as the sweep would indicate, but one has to give credit to a very exciting and good San Francisco team. The Giants made things happen while the Tigers watched it happen. In the end, the Tigers were left to wonder what the heck happened.

Giants general manager Brian Sabean did a masterful job of putting together his second World Series-winning team in the last three years. Manager Bruce Bochy proved once again that he is one of the very best managers in all of baseball. Sabean said it best in the post-game celebrations that the Giants had a date with destiny, and that the Tigers did not know what they were up against.

Odds-makers in Vegas have the Tigers as 6-1 favourites to win next year's World Series. The Yankees at 7-1 and the Giants at 10-1 round out the top three.

Spring training is only a little over three months away.

Have a great week!

Joe MacIntyre is a Summerside resident. His column appears every Saturday. Comments and suggestions can be sent to j-mac@eastlink.ca.

 

Organizations: NHL, San Francisco Giants, Tigers World SeriesThe World Series Detroit Tigers Yankees

Geographic location: Canada, Murray Harbour, San Francisco Vegas Summerside

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Recent comments

  • JohnW.A.Curtis
    November 12, 2012 - 03:24

    No Don Cherry or ron maclean, go lockout go

  • BigShow
    November 08, 2012 - 10:32

    I see your point, but don't forget how many thousands of employees this big company has. We're talking about 700-800 players to divide it so obviously they're going to get more money. Also, the CEO can be replaced, can you replace the top 5 players in the NHL? I think not. The owners were happy with 43% of a much smaller pie only 8 years ago. What's changed so significantly that they need 50 of a much bigger pie? I understand the economics though and it seems that many teams aren't making money, so the 50/50 split makes sense and is comparable to other pro leagues. But a contract is a contract and players should be entitled to what they were told they were going to receive.

  • Island Sports
    November 03, 2012 - 10:36

    Joe , interesting column however , I enjoy reading your column because you bring Island sports and island topics to the table and there wasnt anything this week. I.ve forgotten about the NHL and dont care how they split up 3.3 billion. lets here more about Caps , Storm , panthers , Rocket , Minor hockey , Jr B , etc with a little sprinkle of pro stuff.