Bettman in Boston
David Staples attended this year’s MIT Sloan Analytics in Boston and reports out on Gary Bettman’s talk at the conference. Bettman’s remarks made David more optimistic about prospects for labour peace. They do not make me more optimistic. (I might agree with David if I had heard Bettman speak, but I’m assuming David has caught the highlights and is quoting accurately.)
David makes two points:
First, there is clearly a different tone coming from the NHL as negotiations approach. Second, the bright and bubbly revenue picture being painted by Bettman can hardly be consistent with a league about to go to war over league finances.
There is a different tone, but only because circumstances have changed. Bettman could have made exactly the same claims about revenue in 2003. The lockout in 2004 was about a fundamentally different system and to get it Bettman had to de-market hockey. The message was “The system is broken. If we get cost certainty, we will have fairness, competitive balance and financial stability in all 30 markets. Edmonton can be great again because they will be able to keep all their good players.”
Bob Goodenow’s position was dismissed when he pointed out that revenues had exploded in the previous decade. The dispute was not about revenues – it was about failing franchises and controlling costs.
Bettman’s point here – setting aside the bragging – was that the lockout did not impact on revenues. The fans and the fan’s money immediately returned once the dispute was done. He’s confident he will have the support of the fans and the owners will be united again.
The dispute is not going to be about system this time. It is going to be about money, plain and simple. The story will be positive and upbeat. They certainly do not want to talk about how the CBA is driving the best players and teams into the best markets where they can generate the biggest revenues. They do not want to discuss whether this system is making it far harder for the smaller markets or whether it has done precisely the opposite of what he promised. This time the dispute is about money and a strident tone only makes the owners sound greedy.
“The game has never been greater and parity has never stronger. Record attendance. Record revenue. The system – with a few tweaks, maybe, – is working great. The only problem is that the players are still making too much money and salary inflation will kill us eventually. If the NFL and NBA can’t afford to pay their players 57% of revenues how can the NHL?”
David’s second point:
Is there now too much money on the table for both sides to risk another labour disruption. That’s my bet. That’s certainly the feeling you get after hearing Bettman crow about revenues. I’d be astonished if there was any kind of NHL strike or lock-out as both sides are making so much right now. They can’t risk alienating the fans.
They can’t risk alienating the fans? Gary just finished telling the crowd that this was not a risk! That’s what the NHL owners learned in 2004. They locked the players out for an entire year and fan support did not waver. They came roaring back when hockey came back. Gary does not think it will take a year this time, but he is not afraid to shut things down again.
Is Gary prepared to shut down hockey when there are savings of nearly $250 MM in the first year? When the players can be forced to give up say $2 billion over the next seven years?
Absolutely, yes he will.
Postcript: I wish the moderator – the media – was a lot more specific with questions for Bettman. “What is the dealbreaker for the league? Will you lock the players out if they refuse to take a $2 billion pay cut? Or can the fans count on hockey next season?”