carpandean Posted January 28, 2009 Report Share Posted January 28, 2009 http://tsn.ca/nhl/story/?id=264864&lid...s=headlines_nhl DETROIT - The Detroit Red Wings have agreed to a contract extension with forward Henrik Zetterberg worth slightly more than US$72 million over 12 years. OK, does anyone actually think that $6 million per is "market value" for Zetterberg? Heck no. So, is it just him taking a discount for the team? Probably not. In 12 years, he will be in his forties. More than likely this contract will be extremely front loaded. Those last four or five years will most likely be stepping down with each in the $1-3 million range. Really, this is more likely a 7 year, $9 million per contract with the extra four years (and $9 million) designed to bring the cap hit way down and be bought out easily (if they do it after year seven, for example, the hit from the buyout would be $0.5625 per year for eight years.) If they lock up Franzen with a similarly structured deal, they might even be able to keep Hossa. Link to comment Share on other sites More sharing options...
nfreeman Posted January 28, 2009 Report Share Posted January 28, 2009 Nice move by Detroit. Zetterberg is only 28 and is a top-5 player in the NHL. They lock him up for his entire career at a very friendly cap number. As for the contract, Carp's analysis sounds spot-on, as usual. Link to comment Share on other sites More sharing options...
BetweenThePipes00 Posted January 28, 2009 Report Share Posted January 28, 2009 http://tsn.ca/nhl/story/?id=264864&lid...s=headlines_nhl OK, does anyone actually think that $6 million per is "market value" for Zetterberg? Heck no. So, is it just him taking a discount for the team? Probably not. In 12 years, he will be in his forties. More than likely this contract will be extremely front loaded. Those last four or five years will most likely be stepping down with each in the $1-3 million range. Really, this is more likely a 7 year, $9 million per contract with the extra four years (and $9 million) designed to bring the cap hit way down and be bought out easily (if they do it after year seven, for example, the hit from the buyout would be $0.5625 per year for eight years.) If they lock up Franzen with a similarly structured deal, they might even be able to keep Hossa. The Bold part is where the "big market" teams have the advantage and where it becomes unlikely the Sabres will do these kinds of deals. The cap it is minor, but you have to actually pay the player a huge chunk of money all at once. The idea of paying, for example, a 36-year old guy millions in one lump sum NOT to play hockey for you anymore is probably not the kind of thing the Sabres can budget for .... let alone someone like Nashville or Columbus or whoever. Link to comment Share on other sites More sharing options...
carpandean Posted January 28, 2009 Author Report Share Posted January 28, 2009 The Bold part is where the "big market" teams have the advantage and where it becomes unlikely the Sabres will do these kinds of deals. The cap it is minor, but you have to actually pay the player a huge chunk of money all at once. The idea of paying, for example, a 36-year old guy millions in one lump sum NOT to play hockey for you anymore is probably not the kind of thing the Sabres can budget for .... let alone someone like Nashville or Columbus or whoever. Exactly. I've said before that, in addition to the limitations on year-to-year salary changes (in my example, year 8 would have to be something like $4-5 million, then year 9 could be $2-3, etc.), there should be a limit on the difference between the max and min of a single contract. For example, the lowest year can't be less than half of the highest year. Link to comment Share on other sites More sharing options...
BetweenThePipes00 Posted January 28, 2009 Report Share Posted January 28, 2009 Exactly. I've said before that, in addition to the limitations on year-to-year salary changes (in my example, year 8 would have to be something like $4-5 million, then year 9 could be $2-3, etc.), there should be a limit on the difference between the max and min of a single contract. For example, the lowest year can't be less than half of the highest year. Well i don't know if that would help ... I mean, it would definitely make it more expensive to do, but doesn't making something more expensive help the big markets MORE? Right now, it would be difficult for the Sabres to do, but that change might make it impossible. If the Rangers or Leafs really need the cap room, the price tag on the buyout won't matter much, they will pay the extra that your suggestion would create. But if the Sabres want to sign someone to a 10-year deal where the first year is $8 million, having the last two years be no less than $4 million each makes it really cost prohibative if they want to buy the guy out after 8 years ... because at best those last years could be $4 million each. Right? I could be missing something. Link to comment Share on other sites More sharing options...
carpandean Posted January 28, 2009 Author Report Share Posted January 28, 2009 Well i don't know if that would help ... I mean, it would definitely make it more expensive to do, but doesn't making something more expensive help the big markets MORE? Right now, it would be difficult for the Sabres to do, but that change might make it impossible. If the Rangers or Leafs really need the cap room, the price tag on the buyout won't matter much, they will pay the extra that your suggestion would create. But if the Sabres want to sign someone to a 10-year deal where the first year is $8 million, having the last two years be no less than $4 million each makes it really cost prohibative if they want to buy the guy out after 8 years ... because at best those last years could be $4 million each. Right? I could be missing something. The one thing that is constant for all teams is the cap. The really big market teams could still afford to buyout those contracts, but could they afford the cap hit, too? At $0.5 per year, they have no problem, but if that rises to $2 million because of my proposal, that really starts to hurt. Remember that big market teams are usually right up at the cap, while small to mid cap teams are usually limited more by their internal budgets. Link to comment Share on other sites More sharing options...
Hawerchuk Posted January 28, 2009 Report Share Posted January 28, 2009 Isn't this deal kinda like the one DiPeitro signed a short while back with NYI? It was like a 10yr deal or something. Link to comment Share on other sites More sharing options...
shrader Posted January 28, 2009 Report Share Posted January 28, 2009 http://tsn.ca/nhl/story/?id=264864&lid...s=headlines_nhlOK, does anyone actually think that $6 million per is "market value" for Zetterberg? Heck no. So, is it just him taking a discount for the team? Probably not. In 12 years, he will be in his forties. More than likely this contract will be extremely front loaded. Those last four or five years will most likely be stepping down with each in the $1-3 million range. Really, this is more likely a 7 year, $9 million per contract with the extra four years (and $9 million) designed to bring the cap hit way down and be bought out easily (if they do it after year seven, for example, the hit from the buyout would be $0.5625 per year for eight years.) If they lock up Franzen with a similarly structured deal, they might even be able to keep Hossa. Retirement is also a major possibility in the late years of that contract. Link to comment Share on other sites More sharing options...
carpandean Posted January 28, 2009 Author Report Share Posted January 28, 2009 Isn't this deal kinda like the one DiPeitro signed a short while back with NYI? It was like a 10yr deal or something. 15 yrs. It also shows the danger of contracts this long. He's been injured more often than not. Retirement is also a major possibility in the late years of that contract. What happens to the contract if that occurs? Link to comment Share on other sites More sharing options...
tom webster Posted January 28, 2009 Report Share Posted January 28, 2009 First, I think it is great that Detroit is trying to prove that you don't need to pay top end dollar for goaltending as long as you have premium talent throughout the rest of your line up. Second, there are certain restrictions on the amount the contract can fluctuate. Also, Datsyuk, Lidstrom and Rafalski all have contracts that are level throughout the deal. Third, with $46 million already tied up and their whole defense coming back next year, its unlikely that they are able to keep Hossa and/or Franzen without trading someone who already has a contract. Link to comment Share on other sites More sharing options...
Taro T Posted January 28, 2009 Report Share Posted January 28, 2009 15 yrs. It also shows the danger of contracts this long. He's been injured more often than not.What happens to the contract if that occurs? The CBA directly addresses retirement due to injury. For players that signed multiyear deals after they were 35 (which doesn't apply here) the full salary counts against the cap. For players younger than that, the team gets cap relief. (Too lazy too look up the exact mechanics and don't recall the details off the top of my head.) There are no voidable years in a contract, so technically a player can't voluntarily retire w/out bringing in circumvention provisions. I'd expect that if it's determined there was no monkey business that the cap issues would be handled similarly to the Radulov situation (I assume Nashville has some cap space freed up because his salary this year would have been higher than his cap hit, but don't know how the league dealt w/ it) and if there was monkey business then the club would lose draft picks or face some other penalty. I'd expect the team would have their cap effected by the retiree's contract with the exact amount determined by the average salary minus the value of the contract for that particular year until there is a net of 0 between total averaged salary and total actual paid salary ( :huh: ) so the team will gain cap room in a front loaded contract until everything zeroes out and would lose cap room until it all zeroes out in a back loaded contract. Either way, though the true answer is, it will be addressed in the next CBA. He in all likelihood won't retire voluntarily prior to the next CBA being in effect. First, I think it is great that Detroit is trying to prove that you don't need to pay top end dollar for goaltending as long as you have premium talent throughout the rest of your line up. Second, there are certain restrictions on the amount the contract can fluctuate. Also, Datsyuk, Lidstrom and Rafalski all have contracts that are level throughout the deal. Third, with $46 million already tied up and their whole defense coming back next year, its unlikely that they are able to keep Hossa and/or Franzen without trading someone who already has a contract. Those restrictions are basically that a contract can't increase by more than the smallest of the 1st 2 years' salary in any given year. (If your 2nd year salary is $1MM, you can't get a $2MM raise from year 4 to 5.) And that you can't decrease the salary by more than 50% of the smaller of the 1st 2 years' salary in any given year. (So if you made $10MM in each of years 1 and 2, you could go down $5MM in any particular year.) So Detroit would still have a lot of leeway in structuring the deal if they wanted it. Link to comment Share on other sites More sharing options...
ExiledInIllinois Posted January 28, 2009 Report Share Posted January 28, 2009 Flame me all you want, but I have always said that there should be no cap in sports... And if there is to be one... Maybe hockey... But, this just proves how by no means it is the "silver bullet" for parity. Again... Flame, but baseball is the only one that gets it right. Let the market decide. Link to comment Share on other sites More sharing options...
ExiledInIllinois Posted January 28, 2009 Report Share Posted January 28, 2009 Disagree, and the market doesn't decide it. The Yankees, Red Sox, Cubs and Dodgers....etc decide the market. True. But, it is laughable what the cap sports have become. Look at the facts, baseball over the last 30 years have had more DIFFERENT teams in the World Series than the other sports. True the Yanks and Sux have been in there... But, there is always a dark horse lurking. I was laughing at how they were taughting the cap and football... See how the KC Royals have been squealing... Watch, they may be contenders this year...?? Let the big markets decide and let them over shoot and screw up. Give it time, you will see how the cap polarizes. Link to comment Share on other sites More sharing options...
ExiledInIllinois Posted January 28, 2009 Report Share Posted January 28, 2009 Don't get me wrong... I can embrace a cap IFF: The cap is set to whatever the smallest team is willing to spend. Link to comment Share on other sites More sharing options...
Bmwolf21 Posted January 28, 2009 Report Share Posted January 28, 2009 Flame me all you want, but I have always said that there should be no cap in sports... And if there is to be one... Maybe hockey... But, this just proves how by no means it is the "silver bullet" for parity. Again... Flame, but baseball is the only one that gets it right. Let the market decide. Right. Let the market decide, and eliminate 80% of your teams from playoff contention before Opening Day. The cap is a necessary evil to maintain some semblance of balance and equity among the teams, keeping them on equal footing in terms of payroll. Link to comment Share on other sites More sharing options...
shrader Posted January 28, 2009 Report Share Posted January 28, 2009 Don't get me wrong... I can embrace a cap IFF: The cap is set to whatever the smallest team is willing to spend. Or how about determining what the average team spends and then allowing for an $8 million cushion in either direction? Link to comment Share on other sites More sharing options...
Bmwolf21 Posted January 28, 2009 Report Share Posted January 28, 2009 Or how about determining what the average team spends and then allowing for an $8 million cushion in either direction? Probably a much better idea. To me, EiI's idea sounds like collusion on a grand scale. Looking at MLB from 2008, if everyone had a cap of $21M, that would have to force player salaries way, way down, and there's no way the PA would agree to it. Link to comment Share on other sites More sharing options...
ExiledInIllinois Posted January 28, 2009 Report Share Posted January 28, 2009 Probably a much better idea. To me, EiI's idea sounds like collusion on a grand scale. Looking at MLB from 2008, if everyone had a cap of $21M, that would have to force player salaries way, way down, and there's no way the PA would agree to it. :rolleyes: True. So what. Then what do you do? Seems things aren't working better with the cap and it is still collusion, just not on a "gand scale." And anyway, in baseball on opening day... Nobody was eliminated... Only in the mind of the teams that complain. Didn't the Brewers make it? Didn't the Rays go to the World Series? Phillies won right? Where were the Sux, Yanks, Cubs, and Mets... All looking in or getting beat. Link to comment Share on other sites More sharing options...
Bmwolf21 Posted January 28, 2009 Report Share Posted January 28, 2009 :rolleyes: True. So what. Then what do you do? Seems things aren't working better with the cap and it is still collusion, just not on a "gand scale." And anyway, in baseball on opening day... Nobody was eliminated... Only in the mind of the teams that complain. Didn't the Brewers make it? Didn't the Rays go to the World Series? Phillies won right? Where were the Sux, Yanks, Cubs, and Mets... All looking in or getting beat. After reading this I see your :rolleyes: and raise you a <_<. WTF do you mean "what do you do?" MLB doesn't have a cap and that's the problem. Try rolling out a $21M salary cap and you'll have another labor stoppage 20 minutes later, because the PA is NOT going to go along with the average salary dropping 200%. If you really believe that every team in MLB had a chance on opening day then I don't know what to say. Look at the teams who made the MLB playoffs this year - Dodgers, Angels, Red Sox, Phillies, White Sox, Cubs, Brwers, Rays. The series was won by a big-market club with the 12th-highest payroll, a team expected to make the playoffs. All big-market teams except two. There's always a Cinderella team. Last year it was the Rays. The year before it was the Rockies. That doesn't prove that the system works. If the system worked the teams like that would be able to keep their teams together and maintain their success. The caps "works" in the NHL, NFL and NBA because they do promote some sort of parity. They are a necessary evil to ensure that all teams have the same opportunity to pay for talent. There will always be teams looking to find a way around the cap, and the leagues have to constantly tinker and adjust to make sure that loopholes are closed. If the NHL doesn't examine and adjust the cap, then yes, it's going to get exploited and should be scrapped. Could it have been done better? Probably. But that doesn't mean that it should be thrown out and go back to the days of the Rangers outspending everyone else by $20M. Link to comment Share on other sites More sharing options...
Knightrider Posted January 28, 2009 Report Share Posted January 28, 2009 Flame me all you want, but I have always said that there should be no cap in sports... And if there is to be one... Maybe hockey... But, this just proves how by no means it is the "silver bullet" for parity. Again... Flame, but baseball is the only one that gets it right. Let the market decide. I despise baseball because there is no cap. There will almost never be a small market WS winner. The league as a whole would do much better if any team realistically had a shot at the championship. There isn't a market force within the league. The league competes against other leagues (i.e., NHL vs MBA), as well as other sources of entertainment for market share. Link to comment Share on other sites More sharing options...
Wyborowa Posted January 28, 2009 Report Share Posted January 28, 2009 Well...the KHL did want to become bigger than the NHL...maybe the Ruski's will get their wish!! Link to comment Share on other sites More sharing options...
matter2003 Posted January 29, 2009 Report Share Posted January 29, 2009 Teams with more money to spend are ALWAYS going to have an advantage over teams without the money to spend...that is just the way it is...whether its manifested by hiring more scouts, better coaches, better facilities, better players, cap manipulation, etc....in the end it really doesn't matter, and it just becomes an exercise in how much the field is tilted towards those teams.... Link to comment Share on other sites More sharing options...
Patty16 Posted January 29, 2009 Report Share Posted January 29, 2009 from my interpretation of the CBA you cannot allocate different portions of the salary to diff years like you can in NFL. The $$ divided by length is cap hit. Link to comment Share on other sites More sharing options...
carpandean Posted January 29, 2009 Author Report Share Posted January 29, 2009 from my interpretation of the CBA you cannot allocate different portions of the salary to diff years like you can in NFL. The $$ divided by length is cap hit. True, which is exactly why these contracts work. They structure the deal with the going rate salary up front and a very low value at the end, which means they get the player now for a cap hit that is well below market value for that player. In this example, they could pay Zetterberg his going rate by giving him a 8 year, $64 million contract, which would leave them with a $8 million cap hit for each of the next 8 years. Instead, they give him a twelve year deal structured like: 8, 8, 8, 8, 8, 8, 8, 8, 4, 2, 1, 1 (just an example, would likely be even more front weighted), which gives them a $6 million cap hit for those 8 year. Even if they chose to buy him out after eight year, their cap penalty would be half of the remaining $8 million divided over twice the remaining four years, or $4 million/8 yrs = $0.5 million per year. They have the cash, as a big market team, to pay the higher salary now and they get a bonus $2 million in cap for the next 8 years at a cost of half a million per year for the eight after. Link to comment Share on other sites More sharing options...
shrader Posted January 29, 2009 Report Share Posted January 29, 2009 True, which is exactly why these contracts work. They structure the deal with the going rate salary up front and a very low value at the end, which means they get the player now for a cap hit that is well below market value for that player. In this example, they could pay Zetterberg his going rate by giving him a 8 year, $64 million contract, which would leave them with a $8 million cap hit for each of the next 8 years. Instead, they give him a twelve year deal structured like: 8, 8, 8, 8, 8, 8, 8, 8, 4, 2, 1, 1 (just an example, would likely be even more front weighted), which gives them a $6 million cap hit for those 8 year. Even if they chose to buy him out after eight year, their cap penalty would be half of the remaining $8 million divided over twice the remaining four years, or $4 million/8 yrs = $0.5 million per year. They have the cash, as a big market team, to pay the higher salary now and they get a bonus $2 million in cap for the next 8 years at a cost of half a million per year for the eight after. All of this and it doesn't even include the obvious incentive to the player to get most of the money up front. Link to comment Share on other sites More sharing options...
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