CBA Turmoil: Could The NFL, NBA and NHL All Be Headed For a Work Stoppage?
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This has been a summer of turmoil for many of North America's professional sports leagues.
First, Lebron James, Chris Bosh and Dwayne Wade's plan to join forces came to fruition in Miami, sparking outrage and feelings of betrayal amongst fans. There were accusations of collusion and spying directed at the three superstars and at Pat Riley. Ultimately though, this offseason proved that the NBA's salary cap system is broken and needs to be rewritten.
Turning our attention to the NHL, commissioner Gary Bettman opened a huge can of worms when he (rightly) rejected Ilya Kovalchuck's 17 year, $102 million deal and then proceeded to threaten similar contracts such as those of Roberto Luongo, Marc Savard and Marion Hossa.
Lastly, the NFL is about to enter its first capless season in many years.
There is always a fair amount of drama in any offseason, but the fact that the NFL and NBA CBA's expire after this upcoming season and the NHL's expires in 2012 causes these controversies to take on greater significance.
In the NFL, the upcoming season is going to played without a Salary Cap and the League and the Union are at each others throats. The League recently acquired the services Bob Batterman, the man who guided the NHL through its own lockout, and NFL Players Association chief DeMaurice Smith said that the likelihood of a work stoppage in 2011 was "a 14" on a scale of 1-10 earlier this year.
At first glance it may seem ridiculous the NFL would even consider a work stoppage. The NFL sits alone atop the mountain of North American pro sports. Why would they want to risk their position at the top? The answer, of course, is money.
Owners claim that they are not making money, but are in fact losing it. At the same time, they refuse to open their books so there is no way of knowing if this is true. Players currently receive 60 percent of all revenue generated by the league. The owners would like to reduce this.
While the League's position was weakened when they lost the recent American Needle case, the fact remains that the owners are in a much better position to survive a lockout than the players are. The average NFL career is 3 season, so if all or a portion of a season was lost it would affect the players much more than it would the owners. As well, the TV deal the NFL has with NBC pays $1 billion regardless of whether football is played or not, so the League's coffers are well stocked.
The NBA has dominated headlines this summer thanks to Lebron James and "The Decision". If one looks a little deeper, one realizes that what the Heat did is simply a symptom of a broken system.
David Stern claims that league is bleeding money. As much as $200 million a season. He claims that teams such as Atlanta, Memphis and New Jersey are in serious financial difficulty, but both Atlanta and Memphis handed out max contracts this offseason so how much trouble can they be in?
Word is that the owners want a hard cap to save themselves from themselves. The players will fight this tooth and nail because with the average salary currently at around $5 million, and players such as Kobe Bryant earning close to $25 million a season, they will likely never make as much money as they are right now.
Another major issue is that of guaranteed contracts. Owners want NFL style contracts where they have the power to cut players if they don't perform so that they will not longer be stuck with the Eddy Curry's of the league.
If the league is indeed losing $200 million a season changes will have to made.
Lastly, the NHL. One would think that the NHL would be THE league that would not have to worry about any form of work stoppage, but this is not the case.
Ilya Kovalchuck, the New Jersey Devils and the NHL finally came to an agreement today regarding a new contract for the superstar sniper, but the ramifications of what took place will continue to be felt for a long time.
Reports are that the League and the Players Association have come to a tentative agreement regarding long term contracts, but this issue is likely far from over.
The reason that I remain wary of a possible work stoppage in 2012-2013 is because of who the NHLPA is bringing in to be their next Executive Director; Donald Fehr. The same Donald Fehr who ran the MLBPA for 26 years and through many work stoppages.
It took until this past seasons playoffs for the NHL to finally put the recent lockout in the rear-view mirror, but the league remains in a very fragile position. Revenues and TV ratings are growing, so it would appear that both owners and players should be happy, but that may not be the case.
The majority of small market American teams are no better off than they were before the salary cap. Teams that were profitable before the lockout are still profitable. The only major change that has occurred is the parity that has developed. Parity is a good thing, but parity did not prevent Phoenix from going bankrupt.
There are whispers that Donald Fehr is going to push for the abolition of the hard cap system and attempt to bring in a luxury tax. Bettman will be opposed to this, but will the majority of owners?
Under a luxury tax system, teams such as Toronto, New York and Chicago could spend as much as they wanted on players and would find winning much easier under this system, and nothing sells tickets and merchandise like winning. Teams such as Atlanta, Phoenix and Florida would likely be unable to compete under such a system, but that that would mean that owners of profitable teams would no longer have to prop them up through revenue sharing. Would it necessarily be bad for the league if a few of the sun belt teams folded?
The players currently have to pay 12 percent of their salary into an escrow to cover any shortfall in league revenues. The NHLPA will likely push hard to eliminate this at the next round of negotiations, but the owners and Bettman are not going to give it up easily.
It is highly improbable that all three leagues will experience work stoppages in the next three years. If the NFL does indeed shut down then the NBA and NHL will do everything they can to avoid a similar fate and try to knock the NFL off of its perch as top dog.
One thing is certain though. The next few years could change the landscape of pro sports forever.
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