Okay, I don't know that much about the lockout so I'm just trying
to understand. When I see the owners want to keep the player's salaries
under a $40 million cap, it just motivated me to see why.
You can shoot holes in what I present here if you don't agree with it
but it's not necessary to flame me since I don't claim any complete
knowledge of everything involved.

Let's take an average NHL rink (say it's 18,000 just for round numbers)
and say that it sells out every single game where the average ticket
is $50 per seat (again just for round simple numbers).
With a 41-game home schedule, that works out to:

18,000 seats * $50 ticket = $900,000 revenue per game
$900,000 * 41 games = $36,900,000 revenue per season

That means the salary cap is already higher than the total amount
of revenue from ALL tickets sold if (and that's a big if)
every game is sold out.

What's the average attendance for an NHL game?
Probably a lot less than 18,000.

Let's look at the additional revenue that an NHL club brings in.
There is no national TV contract so no revenue there.

Let's presume that local TV contracts bring in some substantial amount.
However, we know that it is unlikely to be anywhere near $40 million per year.
Why do we know that? In 1988, the Yankees received a 12-year contract
from MSG Network valued at $486 million. That works out to $40.5 million
per year for an 81-game season in the biggest media market in the world.
It was an unheard of amount for a club to receive but, being the Yankees,
they could obviously command it.

Okay, this is where I don't know what has possibly changed in the 17 years
since that contract but I doubt very much that San Jose, for example,
is receiving a similar contract in the present day and age
for only 41 games in a much smaller market. Afterall, the NHL can't
get a National Network to broadcast the games -- thus, local TV contracts
are going to be much smaller as a result. This is just simple
economics.

So I don't know what an average local TV contract brings in for
an NHL club but we can guesstimate that is is probably in the vicinity
of at most $10 million per year. And that seems very high.

So the only other revenue of which I am aware is concessions.
I'll define concessions as both food and souvenirs.
Probably we don't know what the revenue intake is for
concessions but we can make an educated speculation again.
For almost any entertainment event, one can anticipate spending
some fraction for concessions as one does for the ticket.
Let's suppose that fraction is somewhere between 50 percent
and 100 percent and call it 75 percent.

Thus, it can be speculated that an NHL club takes in the following revenue
(at the extreme high end):

$36,900,000 tickets
$27,675,000 concessions
$10,000,000 local TV contract
$74,575,000 TOTAL REVENUE (speculation at the extreme high end)

Now that's revenue without overhead. Obviously, one would have to
factor out 33 percent of concessions for overhead.

Thus:

$36,900,000 tickets
$18,450,000 concessions
$10,000,000 local TV contract
$65,350,000 TOTAL INCOME (not including player & personnel salaries)

Thus:

$65,350,000 TOTAL INCOME
-$49,000,000 salary cap as offered by the players
$16,350,000 remaining income

What is the annual salary of a coaching staff and all other personnel
needed in the running of an NHL club? Certainly, the coach, GM
and president alone are going to command an average of at least
$1 million annually. Let's speculate that the underlings get
an additional $3 million.

Thus:

$16,350,000 remaining income
$6,000,000 club personnel salaries
$10,350,000 CORPORATE PROFIT

Does anyone think that the average NHL club really takes in
$10.35 million in annual profit with all speculation above
at the extreme high end?

Your welcome to correct me on my speculation but
you probably need somewhat of a legitimate source
to really prove my speculation as poorly contrived.
Maybe it is.

On Tue, 22 Feb 2005 03:06:13 GMT, luxor1275bc@yahoo.com wrote:


The average ticket price is probably higher, specially for big market
teams. Also you left out the lux box which bring in large amounts of
revenue. The TV/Radio deals are trickey because almost all of the
teams are either owned by cable companies or have their own cable
channel. So revenues from TV are really hard to figure out as the
advertsing on TV goes to mostly a seperate company and the value that
maybe to the hockey club may be less then if they went into the open
market. Also you need to measure what value is given to the channel,
like MSG, by having games on. It gives them full time programming,
along with the Knicks and baseball. m not sure you can measure that in
terms on $. Throw in adversting and parking also.

Also usally the big bucks are made when the playoffs start. Some time
can bring in millions per games from everything.

On Tue, 22 Feb 2005 03:06:13 GMT, luxor1275bc@yahoo.com wrote:


The average ticket price is probably higher, specially for big market
teams. Also you left out the lux box which bring in large amounts of
revenue. The TV/Radio deals are trickey because almost all of the
teams are either owned by cable companies or have their own cable
channel. So revenues from TV are really hard to figure out as the
advertsing on TV goes to mostly a seperate company and the value that
maybe to the hockey club may be less then if they went into the open
market. Also you need to measure what value is given to the channel,
like MSG, by having games on. It gives them full time programming,
along with the Knicks and baseball. m not sure you can measure that in
terms on $. Throw in adversting and parking also.

Also usally the big bucks are made when the playoffs start. Some time
can bring in millions per games from everything.

luxor1275bc@yahoo.com wrote:


So far so good.


Canadian teams have national contracts, but they pale in comparison to
what a US TV deal *could* be.


Very high for the average team.


Actually, this is surprisingly close to the owners' claim of $2.2B total
revenue.


I don't think you need to take overhead off for only the concessions. I
would stick with your original numbers above.



OK, here's what I would add:

On the big minus side: Far and away, the number one cost is rent and/or
financing on one's own arena. Included in this is property taxes.

There are many other expenses like insurance, travel costs, etc..

On the big plus side: Playoffs!! I've heard the number many times that
a home playoff date is worth $1M to a team. That adds up pretty quick
for a team like the Leafs who have averaged approx. two rounds for the
last 6 years.

There are many other revenue sources like merchandise, licensing, etc..

It's worth mentioning the significance of the playoff money issue. A
team with money in the first place can spend big on players, and have a
reasonable chance of getting a good portion, or all back by making the
playoffs. A team that doesn't spend has a much smaller chance of
cashing in on playoff revenue. Thus, a team that really can't afford it
is *forced* to keep pace with the big spenders. It's doubly painful for
a poor team, because fans don't spend to see a team that never makes the
playoffs.

luxor1275bc@yahoo.com wrote:


So far so good.


Canadian teams have national contracts, but they pale in comparison to
what a US TV deal *could* be.


Very high for the average team.


Actually, this is surprisingly close to the owners' claim of $2.2B total
revenue.


I don't think you need to take overhead off for only the concessions. I
would stick with your original numbers above.



OK, here's what I would add:

On the big minus side: Far and away, the number one cost is rent and/or
financing on one's own arena. Included in this is property taxes.

There are many other expenses like insurance, travel costs, etc..

On the big plus side: Playoffs!! I've heard the number many times that
a home playoff date is worth $1M to a team. That adds up pretty quick
for a team like the Leafs who have averaged approx. two rounds for the
last 6 years.

There are many other revenue sources like merchandise, licensing, etc..

It's worth mentioning the significance of the playoff money issue. A
team with money in the first place can spend big on players, and have a
reasonable chance of getting a good portion, or all back by making the
playoffs. A team that doesn't spend has a much smaller chance of
cashing in on playoff revenue. Thus, a team that really can't afford it
is *forced* to keep pace with the big spenders. It's doubly painful for
a poor team, because fans don't spend to see a team that never makes the
playoffs.

On Mon, 21 Feb 2005 22:43:15 -0500, "pawn, loathesome, credible"
<pawn@porterhouse.com> wrote:

Now here is one # that can play out all different ways. Some time the
state or city builds the arena and the team get a sweet heart deal on
it or they split the costs and still get a great deal on it, the tax
players are the loser here. The area is own by the team and they have
multi events there so the cost are spread over a # of different teams
and events, not to mention the revenues that they receive from letting
other people put on events. There are alot of tax abatements that go
on here.





Big money is made in the playoffs, specially the further you go as
tickets prices keep going up and up.

You would think that, at least in baseball it seems true, but in
hockey if you look at the teams that have made the playoffs and the
finals over the last so many years alot of the smaller market, lower
spending teams have made it while teams like the Rangers have not.
What does happen is from all the success players want more money and
those smaller market teams can't match the the larger market teams so
they lost players and this force them to need a much better farm
system and scouting staff.

On Mon, 21 Feb 2005 22:43:15 -0500, "pawn, loathesome, credible"
<pawn@porterhouse.com> wrote:

Now here is one # that can play out all different ways. Some time the
state or city builds the arena and the team get a sweet heart deal on
it or they split the costs and still get a great deal on it, the tax
players are the loser here. The area is own by the team and they have
multi events there so the cost are spread over a # of different teams
and events, not to mention the revenues that they receive from letting
other people put on events. There are alot of tax abatements that go
on here.





Big money is made in the playoffs, specially the further you go as
tickets prices keep going up and up.

You would think that, at least in baseball it seems true, but in
hockey if you look at the teams that have made the playoffs and the
finals over the last so many years alot of the smaller market, lower
spending teams have made it while teams like the Rangers have not.
What does happen is from all the success players want more money and
those smaller market teams can't match the the larger market teams so
they lost players and this force them to need a much better farm
system and scouting staff.

in-house advertising counts for allot of money, you know those announcements
during the game by corporate sponsors, not to mention the actual adds on the
walls...just another source of revenue for the owners...
<luxor1275bc@yahoo.com> wrote in message
news:FkxSd.120004$6u.38670@fed1read02...

in-house advertising counts for allot of money, you know those announcements
during the game by corporate sponsors, not to mention the actual adds on the
walls...just another source of revenue for the owners...
<luxor1275bc@yahoo.com> wrote in message
news:FkxSd.120004$6u.38670@fed1read02...

>

I agree with you regarding Calgary on one end and the Rangers on the
other, but I suggest they are exceptions. Teams like Philly, NJ,
Toronto, Detroit, Dallas, Colorado and St. Louis have been practical
locks to make the playoffs over the last 5 or 6 years. How does
Pittsburgh even hope to compete?