The financial losses are starting to pile up as a result of the NHL lockout. Today (Tuesday), the league made that public. In speaking to reporters after talks finished up for the day between the NHL and the NHLPA, Deputy Commissioner Bill Daly estimated that the league has lost $100 million in revenues from the canceled preseason. Although they can pick up at any time, for the moment, there are no further talks scheduled. That only further increases speculation that regular-season games could be lost, with an announcement sometime this week. The season was slated to begin Oct. 11. Tuesday’s bargaining session focused on the definition of hockey-related revenue, and featured NHLPA head Donald Fehr, his brother, Steve, the special counsel to the players’ association, and Winnipeg Jets defenseman Ron Hainsey. Daly, in an email to the Associated Press, said the league has not projected potential damage caused by the cancellation of any regular-season games. Clearly, the hope is that it won’t have to address that matter, but the clock is ticking. Now in its third week, the lockout has forced many players to head overseas to play on month-to-month contracts. Others who are eligible to play at the lower levels opened training camp last week with American Hockey League affiliates.
Bill Daly: “Today, was not overly encouraging. We are closer by definition (to canceling regular season games). We are focused on minimizing the damage. What we have repeatedly tried to communicate is that we need to hear from them to move this process along, and we do think that’s the only thing that is going to allow us to gain traction. But that doesn’t mean we stop everything we’re doing and simply wait around for a proposal. If there is something we feel we can do to move the process forward, I’m sure we won’t hesitate to do it.”
Donald Fehr: “They have made some incremental moves, (expecting to informally talk with NHL Commissioner Gary Bettman by Wednesday) It’s clear that the players have made substantial moves towards the owners and the owners have made substantial moves away from the players. We’re looking for a long-term deal that’s fair to the players, league and fans. Certainly, we’re trying to be as creative as (we can be).”
Steve Fehr: “I don’t know (that) I would agree with (that) phrase. Talks can resume anytime they’re ready.”
The National Hockey League might be mere hours away from the first announcement of called-off regular-season games. The league and locked-out players met for plenty of hours over the weekend for there to be some semblance of progress. However, none was reported. More of the same came on Tuesday, when NHL deputy commissioner Bill Daly told reporters that the players weren't willing to compromise. Oddly enough, the players seem to think the owners don't want to compromise, either. So you have a dispute where each side is accusing the other of not wanting to compromise. Meanwhile, the league has already called off the preseason, something Daly said will cost the NHL some $100 million in revenue. (It helps immensely that players are given only modest stipends during the preseason. It's almost nothing but profit for the league and its 30 owners. Could be safe to assume that most players weren't upset about the cancellation of the preseason whatsoever.) Next up are games that count, and the loss of those will mean heavier losses for all sides involved. While the players and owners fight over their $3.3 billion of revenue – and risk losing a chunk of it if they don't stop fighting over it – fans just sit and shake their heads. Of course, the league has already taken its fanbase for granted. Since the fans came back in droves after the 2004-2005 season was canceled by a lockout, commissioner Gary Bettman seems to have surmised that it will happen the same way this time around, no matter how much of the 2012-13 season ends up being lost. It's hard to understand the rhetoric. The sides are convinced that they are living the definition of insanity – doing the same thing over and over again, expecting a different result – by continuing to meet when the other side doesn't want anything to do with a compromise. Obviously, the league is in trouble here if both sides are telling the truth. If neither the owners nor the Players Association are willing to meet somewhere in the neighborhood of the middle, the league will probably not have a season, at least not one that starts anytime soon. Perhaps attitudes change once money is lost. As I already mentioned, the NHL players don't get paid during the preseason, outside of a stipend. If they get their escrow money in October as expected, that means it will be closer to the end of the month before they completely miss a paycheck. And, of course, some of them are playing overseas and drawing income from that. It isn't the same income, but it's income, and it might keep some from trying to push their fellow members for a deal as quickly as they normally would. Meanwhile, the owners might have lost $100 million on the cancellation of the preseason, but that's a whopping 3 percent of revenue for the whole season. You and I might scrounge sometimes, but if you have 50 dollars in your pocket, and $1.50 falls through a hole and onto the ground, never to be seen again, I doubt it would be the end of the world.
However, once regular-season games start disappearing, teams will begin to feel it a little bit more. Many more will start laying off employees or drastically cutting their pay. Those teams will face public-relations hits, since it's not like the lockout was initiated by the players or something, and Bettman insists he has unanimous support for this. All of this is grasping at straws, but perhaps something happens along the way in the next month that forces the two sides back to the table for substantive discussions. Oh, and you should also remember that – as unproductive as they have been – there have been more talks in the last month than there were for the first couple months of the lockout last time around. They might not be agreeing, but at least they're speaking.
Anyone that thinks the NHLPA will walk away from the NHL lockout with any type of win is delusional. The fact is that the NHLPA is in a no-win situation and no matter what the end result, they will walk away as losers in their fight with NHL Commissioner Gary Bettman and the NHL owners. Bettman and the owners have dug in their heels on the percentage of hockey-related revenue they are willing to share with the NHLPA. In response, union head Donald Fehr and the players have crossed their arms and set scowls upon their faces, vowing to not accept the paltry offer the NHL has extended their way. Both sides seem willing to forgo the entire 2012-13 season to make their point, and while that solidarity is nice on the part of the NHLPA, it’s basically the players taking $1.873 billion in player salaries and flushing it down the toilet. The players made a total of $1.873 billion last year, and if there is no season they will never get that money back, which means no $11 million for Ilya Kovalchuk and no $525,000 for the players making the NHL minimum salary. $1.873 billion gone, never to be seen again. Without some significant give on HRR, the season will most likely be lost. While the NHLPA may consider their strong united front and refusal to give in to the demands of Bettman and the owners a victory, it will be hard to believe those claims when the players forgo almost two billion dollars. I understand the thinking, but the reality is no NHL owner got rich from owning an NHL team, they were rich before they owned those teams and will remain rich with or without an NHL season. In fact, if we are to believe the claims of some teams, the owners may actually save money by scrapping the 2012-13 season. So while the owners will still be swimming in cash with or without an NHL season, can the same be said of the individuals that were not rich before they became NHL players? If the players do cave in and agree to the NHL’s HRR number and sign off on a new collective bargaining agreement, they can be sure that when that deal expires, the owners will be looking to take more back from them. Agreeing to the huge cut in HRR will show weakness, and you can bet that the owners will look to exploit that perceived weakness the next time the two groups sit across from each other at the bargaining table. There you have it in a nutshell, the NHLPA can stand strong and give up nearly two billion dollars or they can sign off on a new CBA and expect to get fleeced again a few years down the road. They can’t win, they can only lose less and that’s an awful situation for the players to be in.
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