The Philadelphia Flyers' bank-busting offer sheet to Shea Weber -- just the seventh signed since 2006 -- is a perfect demonstration of what ails the NHL and what's wrong with its current collective bargaining agreement.
The NHL took a lot of flak for its initial proposal in CBA negotiations which, according to most reports, asked for all kinds of ludicrous, radical or even insulting rollbacks from the NHL Players Association. There is good reason for that flak.
A league that regularly pats itself on the back each All-Star Break for growing revenues, a league that has seen its revenues grow year after year since the 2004 lockout, a league that claims even the eternal limbo Phoenix Coyotes are on solid footing -- it is this league that cries poor the same summer three (nearly) $100 million contracts are handed out.
And yet while the league continues to see overall revenues grow to unseen heights that make it look like a cabal of hypocrites, this growth masks problems that defy simple black-and-white descriptions of the labor situation. Revenue-wise, the NHL is a very top-heavy league, with perhaps just six or seven teams making paper profit most years. A select few elite franchises generate the bulk of those revenues the league crows about. Many of the rest struggle to break even.
If small-market teams like the Nashville Predators can lose their home-grown talent like Weber and Ryan Suter thanks to big-market teams offering a groundbreaking $26 million in signing bonuses in the first calendar year -- part of $52 million in bonuses in the first four seasons of the Weber contract -- then the league has a parity problem it will never shake.
(In theory, greater parity should help both sides at the CBA table: It makes the league more competitive, builds stronger markets and a reliable TV product like the NFL built once upon a time, and ensures 30 healthy teams keep players employed as happy millionaires.)
Although contracts like the Flyers' offer sheet to Weber and the Wild's nabbing of Suter and Zach Parise make the league look like it's talking out of both sides of its many-sided mouth, those teams are just doing what they can do to improve themselves within the rules. And it's this exact situation, this disparity between haves and have-nots, that causes the NHL to request a five-year limit on contracts and a 10-year wait for players to reach unrestricted free agency: With those seemingly radical rules in place, low-revenue teams could hold on to their home-grown stars for longer, while big-revenue teams wouldn't be able to yank them away with cap
circumventing navigating deals that carry on at paltry sums into a player's twilight years.
As Scott Reynolds has pointed out, many of the reported tenets in the league's initial proposal aren't quite as crazy as they initially sound -- they're radical and self-interested, sure, but most of them, such as the limit on contract term, would only affect the league's very best players who are good enough to command lengthy deals steeped in cap trickery.
The real question, as Reynolds points out, is which proposals alter how revenue is distributed and which proposals alter how much revenue is distributed. Proposals that alter revenue distribution don't hurt the players as a whole -- in fact they'd help many players who pay more in escrow so that the league's stars can take their front-loaded money up front.
But the other side to this coin, and another obvious response to revenue disparity, is that the league could solve a lot of its own apparent competitive concerns if it agreed to greater revenue sharing. As Reynolds suggests:
...Take a point cut for every five points of revenue sharing (without restrictions) the owners are willing to agree to. Thirty stable franchises is good for the players because it means more stable jobs. In exchange for agreeing to the percentage cut, the players could ask for [Hockey Related Revenues] to be changed to include relocation fees and expansion fees.
Obviously teams like the Flyers would rather spend $110 million to steal Weber from the Predators than dump more of its own money into revenue sharing to help the Predators keep Weber.
Which brings us to the other central thread of CBA negotiations: It is inherently owner against owner, player against player. Every inch players concede to limiting contract lengths prevents stars from gobbling more of the pie and -- assuming the overall split of revenues remains the same -- allows more of it in average joes' pockets. Meanwhile, every limit the owners win helps small-market teams be more competitive while limiting the competitive advantage high-revenue teams enjoy.
No doubt for teams like the Flyers, such moves to increase parity are not desirable, but they are at least more palatable if they come along with a greater take-home of HRR, such as the NHL's reported request of an increase from 43% to a 54% share of revenues. But ask the big money-makers to put more cash back into the revenue sharing pool, and reduce their own competitive advantage against poorer teams? Not happening.
It's almost unconscionable to imagine how the league allowed such giant signing bonuses as Weber's in the current CBA, but they were probably a way for rich teams to hold on to some thread of the spending advantage greater revenues afford them. In other words, that's owner vs. owner.
With its poison pill signing bonuses, the Flyers' Shea Weber contract represents what a rich team can do because it can afford it, and because the CBA allows it. It also represents how even a steady, patient, build-through-the-draft small team like the Predators will never hit its stride as long as it can be raided by the league's big dogs.
That situation won't change until the rules do.