For the first time in American history, a sports season was cancelled. The National Hockey League (NHL) cancelled their 2004 – 2005 hockey season after the league and the Players’ Association failed to come to an agreement to new bargaining terms. While other professional sports league, such as Major League Baseball (MLB), had to either shorten or substitute their seasons for such events as the Great Depression or World War II, the Stanley Cup had been given out despite the great turmoil that faced the nation until now.
Even the 1995 NHL lockout which ended after 103 days when the Players’ Association finally accepted a last minute offer after intense negotiations, a meager 48 game season was still able to play out. The NHL now has the ignominy of being known as the first North American major professional league to have to cancel an entire season, something that will haunt the organization for years to come in lost revenues, lost players and most importantly, lost fans.
The NHL and Players’ Association sought to come to a collective bargaining agreement (CBA). A CBA, at least within the NHL, sets forth the rights and obligations of the players, the teams and the league for a set period of time. The current CBA expired on Sept. 15, 2004.
NHL Commissioner, Gary Bettman, delivered the somber news on Feb. 16, 2005. Bettman gave the Player’s Association until 11 A.M. EST to accept the NHL’s final offer – featuring a $42.5 million US per team salary cap, without linking player costs and salaries to that number. However, the deal was denied by the Players’ Association and now while the NHL is planning for a 2005 – 2006 season.
What it comes down to, in layman’s terms, is that the NHL is losing profit and doesn’t have enough money to pay the ever increasing demand from players to raise their salaries. Unfortunately, hockey isn’t as widespread of a sport as something like football or baseball, which makes billions – in some cases – a season. However, hockey players still want more for a salary than the NHL is earning per season, hence, the emotions behind the debates at the negotiation table. Bettman believes that the reason players are demanding more money is because they want to win and teams are willing to pay them top dollar to bring their franchise to the top.
The Wall Street Journal
The day after the announcement, after both fans and players had a chance to react, the NHL released statements concerning the future of the 2005 – 2006 season. While most hope for a full season, it is possible that if an agreement is not reached, replacement players from around the world will be brought in on temporary, low-pay salaries to start the season until a tentative agreement can be reached with the Players’ Association. Bettman warns that depending on the economic fallout of this lost season, there may not be a hockey season for a few years.
The Players’ Association originally sought more than $49 million US per team with a “luxury tax” which the NHL turned down immediately the day before the announcement. They also sought to create exemptions to the salary cap for up to 10 per cent over the $49 million US limit at a tax rate of 150 per cent. They also proposed the so-called luxury tax would increase each year of the new agreement. Players’ Association Chairman Bob Goodenow told the media the day of the announcement that there would be no season that the players were adamant in their demands and this needed to be done to preserve a fair deal on both sides.
As of today, there are rumors circulating that two major American corporations wish to share a joint-bid to buy the entire NHL for $3.5 billion US. This bid was pitched to the league on Mar. 1, 2005 and has yet to receive a serious response. Under the bid, the two companies would run the entire league as one corporation with individual team franchises. This bid would require all 30 team owners to come to a consensus, which is highly unlike, in the uncertain times the negotiations have created.
Many NHL players will continue to play in other leagues around the world, most notably in Europe, while others will continue to play on national teams in the wake of the cancelled American season. reported during the negotiations the scope of economic troubles for the NHL from the 2003 – 2004 season, citing that more than two-thirds of the 40 NHL teams lost revenues.
