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Yet another crucial week in the lockout

Sunday, February 6, 2005

It's the same old story in the National Hockey League labor dispute. As the lockout drags on, another week rolls around and it is said to be a crucial one. With the league saying the lines of communication are still open, the door hasn't been closed on more talks. Whether those talks could open the door to a breakthrough in the stalemate is an entirely different story.

TSN's Bob McKenzie, for one, believes this is the final week for the two sides to get a deal done.

"I really do believe this is the final week," he said on the Canadian network Sunday night. "If we don't get something done over the course of this week then I think we are done. Of course, we've said that over and over again."

When 13 hours of talks between NHL commissioner Gary Bettman and NHLPA executive director Bob Goodenow collapsed last week, Goodenow said no progress had been made.

And though there are indications that there has been no contact between the two sides since Friday, McKenzie, who admits he has been pessimistic about the two sides reaching a deal to save the season because they are so entrenched in their positions, he still thinks there may be some hope this week.

"I believe both these sides are prepared to blow everything up. Having said all that, I've got a little bit of cockeyed optimism. I'll call it relative optimism, if you will, that both sides recognize that this next five day period is where the best possible deal can be constructed." McKenzie said. "Because once they go over the edge I don't think the players are going to get a better deal than what they'll get this week.

"The owners ultimately might think they'll get a better deal down the road, but if they have to blow up the game to do it how much of a better deal is that? That's the only reason there might be some optimism here. Having said that, it is still a pretty bleak picture.

Bleak because there has been little indication the two sides can find a middle ground. The league has offered a salary cap based system while the players have offered a luxury tax proposal.

One player, who wished to remain anonymous, told the Canadian Press he was in favor of the so-called hybrid system that employs both a tax and a cap. The player's suggestion was to start with a stiff tax at $35 million, raise it at $45 million and then cap team payrolls at $50 million.

But then there is that issue of the fixed link between player compensation and overall league revenues, which the league says is crucial. That link continues a major sticking point for the players. The players have two problems. First, there is the issue of defining revenues.

"Linkage is tough because we just don't believe their numbers," Columbus Blue Jackets center Todd Marchant told the Canadian Press. "How can you negotiate a system with a link between revenues and salaries when you just don't respect their financial numbers?"

The second problem for the players is that if revenues drop in the wake of the lockout it would have a big impact on the league's proposed salary cap range. A ten percent drop would push league revenues down to the 2001-02 range of just under $1.9 billion. The salary cap range could drop to perhaps $28 million to $38 million from the league's current $32 million to $42 million range.

Drop the revenues 15 percent and the revenues drop to under $1.8 billion or about about 2000-01 levels. The cap range could drop to $27 million to $36 million or so.

There's the possibility of using some kind of hybrid cap/tax system to phase in the hard link between player compensation and revenues over a couple of seasons as league revenues stabilize in wake of the lockout.

But that would require compromise, which is something that has been absent so far in lockout of 2004-05. And unless something changes this week, then as McKenzie said the picture remains bleak.