Jeremy Laura: Some positive vibes from the Griffins, good revenue news with odd caveats

"Because additional revenue, potentially sparked by deep playoff runs in New York, Toronto, Edmonton or Boston, could result in more money returned to players”
Well 3 outta these 4 teams are assured to get to the Conference finals to maximize profit to the players and the league.

"Because additional revenue, potentially sparked by deep playoff runs in New York, Toronto, Edmonton or Boston, could result in more money returned to players”
Well 3 outta these 4 teams are assured to get to the Conference finals to maximize profit to the players and the league.
- HenryHockey

Right? But the headline gets all the attention and I hear, “did you see, the players are all getting refunds!” You have to go down a few paragraphs for the If/then equation.

Since upwards of half of the escrow withholding could be returned to players, it also calls into question whether the NHL Players’ Association could or should have pushed harder for a higher salary cap for this season. Under new executive director Marty Walsh, the NHLPA engaged in discussions on raising the $83.5 million salary cap as prescribed by the Memorandum of Understanding. But the NHL requested givebacks in return, saying that they would also have to raise the escrow withholding percentage commensurately.

I don't really get this line of reasoning at all.

"Upwards of half the escrow withholding could be returned" still means that the players will end up losing 2-3% of the face value of their contracts. Pushing for a higher cap might have benefited a relatively small number of 2023 UFAs/RFAs, but for the majority of players on previously existing deals (or new deals that would not have been inflated by a higher cap) it just would have meant more lost to escrow. Hard to see how that could be considered a win for the NHLPA.

I feel like a shocking number of hockey fans and even professional writers don't fully grasp this fundamental point, even after nearly two decades. Raising the cap doesn't mean players get paid more. In fact for most players it's the exact opposite, since pushing for a higher cap ceiling without a commensurate increase in revenue just means more lost to escrow.

Players get 50 percent of HRR, period, whether the cap is set to $80 million or $100 million or anything else. The cap basically just determines how much players get per paycheck during the season. But eventually both sides have to square up to 50-50 at the end.

I don't really get this line of reasoning at all.

"Upwards of half the escrow withholding could be returned" still means that the players will end up losing 2-3% of the face value of their contracts. Pushing for a higher cap might have benefited a relatively small number of 2023 UFAs/RFAs, but for the majority of players on previously existing deals (or new deals that would not have been inflated by a higher cap) it just would have meant more lost to escrow. Hard to see how that could be considered a win for the NHLPA.

I feel like a shocking number of hockey fans and even professional writers don't fully grasp this fundamental point, even after nearly two decades. Raising the cap doesn't mean players get paid more. In fact for most players it's the exact opposite, since pushing for a higher cap ceiling without a commensurate increase in revenue just means more lost to escrow.

Players get 50 percent of HRR, period, whether the cap is set to $80 million or $100 million or anything else. The cap basically just determines how much players get per paycheck during the season. But eventually both sides have to square up to 50-50 at the end.
- Sven22

THANK YOU! The entire line of BS about the cap when you’re already losing money is smoke and mirrors. I get a note “the cap is going up 7 million or more”. “Not it’s not”. Revised “the cap is going up 5 to 7 million more” “no it’s not”. Final revision “the cap should go up 4.25 million”. “It probably won’t”. The mandatory 5% increase can (and has been) voted down multiple times. Someone from the Athletic had posted a pic of a player paystub. You can see the image, but it’s a paywall to try and see the whole thing.

I am still trying to figure out why this was released right at this moment. In about a week I think I’ll know more. But people just see the headlines and get all excited. I think some of this is to pacify fan bases where the teams are up against the ceiling with a partial roster. Now you’ve got that bizarre lawsuit where Tavares was hit for 38% of his signing bonus instead of the 16-18% in the Canadian tax law. Those bonus structures for Toronto are huge. If there’s a shift in how they are taxed there are going to be a couple of unhappy campers out there

Hey Jeremy, FWIW, I don’t always post - but I very much enjoy your blog, and in particular, your financial state of the league coverage. Thanks.

Hey Jeremy, FWIW, I don’t always post - but I very much enjoy your blog, and in particular, your financial state of the league coverage. Thanks.
- Chief4Feathers

Oh wow, thank you so much! This really comes from a place where I want the league to make decisions that stabilize what I think of as the greatest sport on the planet.

I enjoy the information provided regarding HRR, Tv contracts, etc. It’s why I read Jeremy’s blog! I’m a Flyer fan, but always liked and respected Stevie Y, and what Jeremy brings to this site.

Keep the information coming, Jeremy! If someone doesn’t like it, remind them of a life without watching hockey.

Thanks for what you bring to the table!

I enjoy the information provided regarding HRR, Tv contracts, etc. It’s why I read Jeremy’s blog! I’m a Flyer fan, but always liked and respected Stevie Y, and what Jeremy brings to this site.

Keep the information coming, Jeremy! If someone doesn’t like it, remind them of a life without watching hockey.

Thanks for what you bring to the table!
- Hokeeguy9

That’s incredibly humbling. Thank you so much for that. I do love this sport and this league. We get to see unbelievable skill and speed on display. It’s not something any of us wants to see get hurt.

I don't really get this line of reasoning at all.

"Upwards of half the escrow withholding could be returned" still means that the players will end up losing 2-3% of the face value of their contracts. Pushing for a higher cap might have benefited a relatively small number of 2023 UFAs/RFAs, but for the majority of players on previously existing deals (or new deals that would not have been inflated by a higher cap) it just would have meant more lost to escrow. Hard to see how that could be considered a win for the NHLPA.

I feel like a shocking number of hockey fans and even professional writers don't fully grasp this fundamental point, even after nearly two decades. Raising the cap doesn't mean players get paid more. In fact for most players it's the exact opposite, since pushing for a higher cap ceiling without a commensurate increase in revenue just means more lost to escrow.

Players get 50 percent of HRR, period, whether the cap is set to $80 million or $100 million or anything else. The cap basically just determines how much players get per paycheck during the season. But eventually both sides have to square up to 50-50 at the end.
- Sven22

I'm nit sure what the rationale is for any of this anymore. When you look at HRR, there seems to be a relatively robust cash flow. Hiding behind C-19 isn't carrying the mail anymore, although there was certainly a hit that was significant the league & PA decided to play "in a bubble" (I keep see John Travolta when I read that.....
), so they knew there was going to be a hit. That leaves some other cash out-flow of significance.... gee, wonder what THAT could be?

Frankly, we saw a mere glimpse of trouble when the book was opened on OTT during the selling process. I'd lay a beer n a dog 2 Van Andle that this is ONLY the very tippy top of the issue. Selling logos on unis & on-ice adverts? ARZ playing in front of MAYBE 4k fans? What else is out there? The league has a cash-flow problem and are expecting the players to make up the difference? I don't know what it is.....but as an Inspector General in the Army, I was taught how to find the Root Cause (called "Root Cause Analysis", interesting concept....) and from what I see right now....there's a rat and the league is going to pay a steep price if they expect the PA to contonue to make up any difference in HRR via escrow. Similarily, the league cannot expect to give cash to floundering franchises: Put them on the block. There's NOT enough money in hockey as it is, it's not a world-wide sport that ANYONE can play, it remains being viewed as a "northern" sport (making in-roads, for sure, BUT.....), and a "rich-kid's sport". Life support, anyone??