Talks break off with tensions rising
No progress on lockout but losses to both sides could force compromise
There’s some fraying around the edges. The lockout is taking its toll. Neither side is willing to move off their latest positions. There’s word of mediation.
With no further talks between the NHL and the NHL Players’ Association planned — negotiations broke off with no progress on Tuesday — the league inched towards cancelling the first part of the season, scheduled to begin Oct. 11.
The two sides say they will remain in touch — and there’s some hope that talks will resume in Toronto later this week — but the NHL and its union seemed to be walking backward in New York, instead of forward toward a deal.
“The definition of no progress that comes out of the NHL office seems to be ‘they didn’t give us what we want yet,’ ” Donald Fehr, the executive director of the NHLPA, told reporters in New York.
Talks seem to be bogged down on small details, such as whether hotel rooms and the cost of trainers on the road should come out of hockeyrelated revenue (which would cost the players money) or whether those items ought to be directly expensed to the team.
“They understand what our position is,” NHL deputy commissioner Bill Daly told The Canadian Press. “To this point, we certainly understand what their position is. We just wish it was different.”
The league says it lost $100 million by cancelling the entire pre-season. Put in terms of the expired collective bargaining agreement, $57 million of that would have found its way into the players’ pockets; $43 million would have been divided among the owners.
The numbers are only going to get bigger as the calendar goes forward.
But there are other pressure points that will prompt saner heads on both sides to figure out how to fairly slice up $3.3 billion — a number that may get smaller the longer this goes on — and end the lockout.
FOR THE PLAYERS
Social media and alcohol: In other words, tell us how you really feel, Krys Barch. Barch, a plugger of an NHLer — one of those with a short career span and a small window to earn the big bucks — let loose an alcohol-fuelled Twitter diatribe that highlighted his frustration at being locked out. For every Joffrey Lupul, a well-paid player whose job is secure and who backed the union in on online article on askmen.com, there are the Barches of the hockey world, guys who could easily lose their jobs coming out of the lockout. It’s not that Barch didn’t back the players’ association. It’s that he’s getting antsy. If other players start feeling antsy, their frustrations will likely show up on social media, where there is no public-relations filter between their thoughts and their fans.
Missing paycheques: The players are supposed to get paid 14 times a year, twice a month during the season. That amounts to about 7 per cent of their pay per payment. The first cheques were to arrive Oct. 15. They will be missed, but not too much. The players will receive about 8.5 per cent of last year’s salary in early October — the return of money that had been put in escrow in case the league didn’t hit revenue targets. That escrow money will help ease the pain, but it won’t last for long. When the second payment is missed on Oct. 31, players will start to feel the pain. Won’t be long before their summer cottages go on the market.
Replacement players: This one is dicey and the NHLPA would fight it, but what’s to stop the league from simply ending the lockout, imposing a new economic order and simply inviting those on the team’s 50player-long reserve list to play if they want? (The players would most likely vote to strike in response.) There is no longer any law banning replacement workers in Ontario, so the Maple Leafs and Senators could play, but would fans cross picket lines? There are laws against the use of replacement workers in Quebec and British Columbia, so the Canadiens and Canucks might have to find somewhere else to play. It’s a break-the-union strategy that backfired spectacularly on Major League Baseball in 1994-95 and brought infamy recently to the NFL for using replacement officials. “You want to talk about a strategy gone bad,” said former management negotiator George Smith, now a fellow at Queen’s University. “It’s a colossal waste of time and energy. The energy would be better directed at trying to find a way to getting things settled.”
Cancelling games: Cancelling games hurts the players more than the owners, at least the early games. If half the league is truly losing money, then not playing costs owners less than playing, while it costs players their income. “The league owners don’t rely on a particular season to survive, but the players do,” said Buzz Hargrove, the former president of the Canadian Auto Workers. “A lot of players make good money, but they established a standard of living based on income. Once that income is gone, no matter who you are, it becomes a huge penalty.” But this also hurts profitable teams. The Leafs, for example, are losing about $2 million in revenue for every home game.
FOR THE OWNERS
NBC: The network wields a mighty stick and isn’t happy. According to thesportingnews.com, ratings for NBC Sports (the network that used to be Versus and Outdoor Life and the NHL’s chief outlet on U.S. TV) are at an all-time low. The good news for the owners is that NBC is paying the league $200 million this year whether there’s hockey or not. That $6.67 million per team will help the owners ride out some of their revenue losses. But it really is a bad long-term business decision. If there’s no hockey, the league will owe NBC a year of hockey — for free — at the end of the contract. If the league grows at its current rate of 7.1 per cent annually, the league will be giving away a product that would be far more valuable than what NBC is paying this year.
Loose lips: Long-time Red Wings executive Jimmy Devellano has already been fined $250,000 for speaking out of turn on the lockout, referring to the players as “cattle” on the owners’ ranch in an email exchange published by a blogger. The Leafs are so paranoid about being fined that they won’t comment on players going overseas during the lockout. Gary Bettman’s rule is ironfisted. But owners, too, have access to social media. When the owner of the Florida Panthers cheerily tweets about a meeting with staff — one at which the team even lays off the mascot — the league looks very bad.
KHL: ESPN made a splash by inking a deal with the KHL to show games on ESPN3, a digital network available in 73 million homes. Alex Ovechkin and his Dynamo Moscow will be featured in three of the first five games. (No word on whether Canadian networks will follow suit.) The NHL has always been able to boast it has the best players in the world. Well, the KHL seems poised to challenge that by becoming the league’s biggest rival since the WHA in the 1970s. And the KHL is going to play games in North America — in Brooklyn’s new stadium. The money seems to be limitless in Russia — not capped like in the NHL. How long before the KHL — a thorn in the NHL’s side — expands to North America, becoming more of a pain in the derriere? The KHL is taking advantage of its chance to plant a seed in North America with this lockout. Another lost season might give the KHL a chance to grow roots.
Exodus to other leagues: Nearly 100 NHLers are playing in Europe, with more trickling over each day. The NHL has also decided to place NHLcalibre players with AHL clubs (mostly young players). So a lot of NHLers have meaningful employment elsewhere, meaning the number of players who are actually locked out is reduced each day. The more players exercise these options, the more they can stand their ground until they get a deal they want.
U.S. Thanksgiving, Winter Classic: If the lockout drags into November, there are points where it hurts the growth of the league. There’s the Friday of the American Thanksgiving weekend, a new must-see date on the hockey calendar, sandwiched between the NFL’s big Thursday and college football on Saturday. Americans are at home and watching TV, and the NHL and NBC want that to be their new big day. Then there’s the Jan. 1 Winter Classic, with the Leafs and Wings scheduled to play before 100,000 fans. “That’s a gravy train for the league,” said Hargrove.