Wednesday, May 7, 2008

Parity vs. Dynasty

I didn't appear at work today but, being playoff time, I can't disclose the reason. All I can say it's that it's an mid-body injury.

With Anaheim mercifully eliminated early (giving Edmonton the 22nd overall pick), articles are abound over whether or not parity in the NHL is a good thing. This year's Stanley Cup winner will be the ninth new champion in a row (omitting the lockout year of course), and there appears to be little evidence that winning a Stanley Cup two or more years in a row is even close to possible. Carolina was a team that got hot at the right time and beat teams that were injured, then missed the playoffs the following two seasons. Last year Anaheim steamrolled the competition, literally, then added Matthieu Schneider and Todd Bertuzzi to replace Scott Neidermeyer, Dustin Penner and Teemu Selanne. Those were downgrades, but then Neidermeyer and Selanna came back to form an awfully formidable team. I picked the Rangers to win the Cup (though not to beat Pittsburgh, because I'm Super Smrt) but never really believed they could win their inevitable matchup with the Ducks. Not only did the Ducks not make the Finals, they lost in six games to Dallas without a lot of fuss. A rare playoff series that was not as close than the series score would suggest. That Anaheim team was build for now and the future too, with excellent young players (Perry, Kunitz, Getzlaf, Pahlsson) a big part of last season's Cup win. There was every reason to think they'd challenge for a long time, but it was not to be. Neidermeyer is likely done, same with Selanne, Bertuzzi is broken (not Steve Moore-broken, but pretty beat up), and everyone else is a year older.

Three seasons is an awfully small sample size, but there's lots of information to suggest that any team who even comes close, let alone wins a Cup, won't be around the following season. Carolina and Edmonton both missed the playoffs last season, Ottawa and Anaheim went out feebly in this year's first round. Carolina lost a couple of players after winning the Cup but when Matt Cullen is your biggest loss, your team is still pretty similar in quality. Edmonton, of course, was forced to deal Pronger, lost Spacek, Peca, and Tarnstrom to free agency. By picking up Roloson, they also lost a first-round draft pick. That team really went for it that year and a drop-off was probably not unexpected. Had they kept Pronger though, things would have been different. Ottawa simply fell apart this year, they had some injuries but evidently Ray Emery showing up late for a few practices was enough to shatter that team's psyche and cost John Paddock his job. Anaheim was the real puzzler; they simply couldn't score enough goals, finishing with only 205 for an average of 2.40/game, 28th in the entire league. Clearly, Dustin Penner was the key to that Cup run and Edmonton is lucky to have him. My own conclusion is that of these four teams Anaheim was by FAR the most likely to repeat. If they couldn't come close, with the excellent goaltending and dominant defense they have, who can?

At this point, Pittsburgh and Detroit are the favored teams to win this year. Pittsburgh could lose Marian Hossa, Pascal Dupuis, and Ryan Malone, putting a damper on any potential Cup defense next year. Detroit is in great shape going into next year, with only Hasek as a UFA. They should be pursuing a real goalie in this case. Philly has R.J. Umberger and Jeff Carter as restricted free agents this off-season, and both could be targets of offer sheets. Otherwise, they're in pretty good shape as well. So is Dallas, with only role player RFA's to re-up with or dismiss. Of these teams, Pittsburgh has the most to lose but also has the most high-end talent returning next season. None of these four teams have rosters full of players that would scare anybody, nothing like what Anaheim had going into this season (and would later have after Neidermeyer and Selanne returned in mid-season), each is either flawed in goal (Detroit and Pittsburgh, unless Fleury finally proves otherwise) or on offense (Dallas has little after Richards and Modano, while Philly could sure use a healthy Simon Gagne next year). In other words, there's no reason to think any of these four teams, based on their rosters next year, will fare any better than Anaheim did this year.

So why is this? The salary cap, of course. Teams can still afford to go out and get high-end talent, that much was obvious this past off-season. It's depth they can't afford. A few injuries or slumps to top players means more ice time for younger, cheaper players who make more mistakes and weaken the team. With players paying into escrow we can't yet know exactly what the average player salary was from this past season, but we do know that the highest payrolls reach only as high as the $50.3 million cap (and with the higher Canadian dollar, more teams able to spend that high) compared with the $77 million spent by the Red Wings in 2003-2004. Clearly, talent is spread around the league to a far greater degree than pre-lockout, more so because the high-revenue, highly-desirable teams, like the Ranger, Flyers, Red Wings and Leafs, can't buy up everyone. Those players have to go somewhere, might as well be Nashville or Pittsburgh. Every team has obvious flaws, and those flaws are what you hear about at the trade deadline: "Well James, the Stars would like to add some secondary scoring before the deadline," "The Penguins are in the market for a depth defenseman," and of course "Ottawa is searching for some MUCH NEEDED GRIT." Teams were trading for those elements before the lockout of course, but now the need is so much more obvious.

For a league with an average ticket price of $48.72 (112.10 for premium seats), a system ensuring league-wide competitiveness and quick rebuilds (Exhibit A: this year's Flyers) is imperative. It's even more important because of the number of teams in non-hockey markets (yeah, that's almost all U.S. cities, I know). Sports played on ice are not part of the culture in probably 95% of the U.S., so having a fair shot at a competitive team each year is paramount. Parity also forces management to improve its team-building methods, as is already becoming evident in Vancouver under Mike Gillis. The old salary system was broken not just because the lower-revenue teams couldn't afford to keep players they'd drafted and developed into their prime, but also because the financial advantage held by high-revenue teams meant little effort went into new methods of statistical analysis. You just simply spent more to cover up mistakes. People point out the Red Wings as an exception, but that's not entirely true. Detroit certainly was successful both before and after the lockout because of their superior European scouting, rather than their ability to simply buy the best players (as did the Rangers), but having that kind of international scouting, as well as the resources to retain those players once they reached their peak, is due to the fact that they just had more cash. So, more money meant more dominance. The salary cap changed that.

Of course, when high revenue teams had to slash salaries by as much as the Red Wings did from 2003-2004 to 2005-2006 ($77 million down to the cap limit of $39 million) without cutting ticket prices, that's pretty good for owners. All that money that went into player salaries? Go buy yourself a new island. Toss some of it back into player development and scouting, always a good investment, but based on how many drafted players actually become NHL players the draft is still a lottery. In that sense, high-revenue teams still have an advantage since money previously spent on player salaries can now go into player development (or into management, as the rumoured $5 million/year Brian Burke-to-Toronto salary suggests). Ultimately though, if the money's spread out so to are the quality players. So the cap, and the parity that inevitably followed, is good for the league, isn't it? Well, that's one argument.

The other argument that parity ignores is the importance of dynasties, made possible under the old system but seemingly gone for good now. Dynasties, flagship teams, marquee teams, benchmarks, whatever you want to call them, are incredibly important in any sports league. Fans watch sports to see glimpses of greatness, to see athletic feats regularly performed that are impossible in their own world. 150 mph serves, 40% 3-pointers, 100 mph slapshots, knee-buckling curveballs hit 500 feet, 60 yard spirals, all performed in ways that make them look easy. Players who often perform great feats become great players, and teams with great accomplishments are admired and copied. Yet a system of imposed parity strips away a team's greatness; a sense of randomness appears when 16 teams make the NHL playoffs with little to distinguish each one. Fans aren't attracted to sports for randomness, in fact, nobody likes randomness in anything. It's chaotic, and as creatures of habit chaos is unpleasant. What fans love, however, is the unexpected. There's a huge difference between randomness and the unexpected. For something to be unexpected, obviously one would need to have a set of expectations already in place. Those would be based on prior events and precedents already set. In other words, if the higher seeds always beat the lower seeds, if the top two or three teams are always the same and usually win the championship, then an upset is far, FAR more exciting and memorable than if lower seeds win some degree of regularity, which in the NHL they currently do.

For that reason, a dynasty is important for any league to have. Teams that gradually build themselves into a league power and remains at a top level for years on end, winning several championships consecutively while establishing themselves as the obvious alpha, provide a sense of stability in an otherwise relativistic environment. Teams can only be judged against others, that's the nature of competitive sports as opposed to judged sports, such as figure skating or gymnastics. As such, it's important to have one team set the standard and provide a stable yardstick from which all other teams can be judged. In the early 1980's, the Edmonton Oilers, while a fabulous regular season team, could never be considered great until the defeated the previous yardstick, the New York Islanders. In this case, there was a perfect sense of ordered transition from one alpha team to the next: the Islander won four Cups in a row, beat the Oilers to win their fourth Cup, then lost to the Oilers who would win five in the next seven years. The torch was seamlessly passed, and the rest of the league's teams, as well as fans, journalists, and historians, had that benchmark teams to compare all others to. Teams like Philadelphia and Boston, whom Edmonton played and defeated in two finals each, are more easily understood because they could be compared to the Oilers.

It's the same in all sports, fans and journalists love comparing the 80's Oilers with the 70's Canadiens, the 80's Lakers with the 59-66 Celtics, the 20's Yankees with the 60's, 70's, or late 90's Yankees. Winning a championship is a tremendous accomplishment by a team that played great, but it does not make a great team. Are the 2006 St. Louis Cardinals a great team? Uh no, they had fewer wins than any other World Series Champion, and fewer than many non-playoff teams that year. What about the 2008 Super Bowl champion New York Giants? Nope, they finished 10-6, a record that tied them with the Cleveland Browns, a team who missed the playoffs. It just shows winning a championship does not a great team make; truly great teams, ones who'll be remembered and compared with other historical dynasties, aren't ones who back their way into the playoffs and suddenly get hot. It's not to knock their accomplishments, this year's Giants beat what was about to crowned the greatest NFL team of all time, but there's another level, reserved for the elite and immortal, of which those teams fall short.

So dynasties are good, even necessary, but can they be allowed to exist under a strict salary cap system? The NHL is the first pro sports league in North America to implement a hard salary cap, meaning there's no circumstances or loopholes allowing teams to go above the limit, while still maintaining guaranteed player contracts. In other words, there's no other model they can look to for new ideas. The challenge is finding a way to allow teams to dominate the competition without resorting to financial advantages. When the new CBA was introduced, three challenges were introduced for teams trying to build a dynasty. I'll break them down.

Not only did the new NHL CBA come with a hard salary cap, but it also stated that the age of unrestricted free agency would steadily drop from 31 years old towards the age of 27 in 2008-2009. So, with the salary cap, teams are restricted in their ability to buy talent on the open market, and thus need to develop their own through drafting and trading for younger, more affordable players. Now that strategy is hampered by the fact that teams are faced with having to re-sign those players at an earlier age, when they're in the heart of their prime. Previously, when the UFA age was 31, players were beginning the downside of their career and big contracts were more of a reward to years of service where they were likely being paid under market value. It was accepted practice for big revenue teams to overpay players in the last years of those big deals, while probably only getting market value for the first few season. Now, players are UFA sooner are during their very best years, meaning there's more competition for their services since they're a far more attractive commodity to all teams, not just high-revenue. As a result, it's even harder to build a team that's consistently challenging for a Cup while your players are allowed to walk for nothing at 27. The mandate falls on the team to give them long-term deals sooner, thus eroding their value as a low-cost young player much sooner.

Another obstacle, of which Kevin Lowe was the catalyst, is teams poaching other teams' restricted free agents. As Lowe smartly realized, it makes more sense to grab young players and pay them big money during their prime seasons (while giving up a few lottery tickets/draft picks) rather than waiting for them to become UFA's. Sure, they become UFA's at a younger age so they're still in their prime, but you have to pay them even MORE money because of the greater demand for their services, as well as the fact that the player has earned total control over where they want to go. Obviously this summer will show how big of a strategy this actually becomes, since so far only Kevin Lowe has tried it. Maybe it catches on, maybe not. It likely will, because when Evgeni Malkin becomes available next year (barring an extension this summer), wouldn't you give up a few draft picks for the chance to have him in your lineup for possibly the rest of this career? Of course you would, a player like that is almost impossible to come by. For Pittsburgh though, it's like winning the Set For Life Lottery or whatever it's called, where you get paid $10,000 a month for 25 years or something, but having someone else come along and buy it from you after three years because that money wants to go to someone better who'll invest it wisely and not buy hooker, porn and blow. Sure, you could match their price but what if you're already out of money? The lottery cash might originally come from a bank in another town and wants to back there (Toronto, of course), or the money's wife just hates you. In other words, the lottery you thought you'd have for a long time got yanked away because you didn't keep your house in order. That's kind of a stretched metaphor. Why only three years? That's the next challenge.

Once you draft a player, you can only sign him to a three-year standard rookie contract. No longer, and for a maximum of only $850,000 a year. That's pretty good, you get Ovechkin, Crosby and Malkin for almost nothing. After year two, you pretty much know what kind of player you have, whether it's a superstar like those or just a very good player like Jay Boumeester. The problem is that everybody else knows too, and now the RFA poaching begins. As a result his next contract is going to be his big money contract. THAT means you'd better re-sign his ass as fast as you can, like after year one or two, before his stock rises too much more in his third year. THAT means if you're lucky enough to draft a couple of franchise players, like Pittsburgh with Crosby and Malkin, you have to sign them to big money extensions after only one or two season in the league. Great for the players, but impossible for teams trying to keep their costs down as they try to build their dynasty. One of Brian Burke's few coherent, non-profane criticism of Kevin Lowe's RFA poaching was that by inflating the value of young players, Lowe has essentially erased the three contract system (three year entry-level, then RFA, then big money UFA) that helps teams keep young players for longer and cheaper. Lowe's point was that the second contract is the one you really should want to spend on, since that's where you're getting the player's peak seasons. True enough, but another challenge against teams keeping their own players.

Back to the initial question. How does a league promote non-financially based dynasties? Looking at the above three challenges makes a few suggestions self-evident. Everyone wants teams who build through the draft to succeed. Fans like it because they get to follow young players from 18 years old through their career. It builds better fan connections and a more community feel around the team. The league likes it because it lends more credibility to the draft, which it can hype because it has a tangible affect on teams' long-term futures. Owners and GMs like it because it's cheaper to draft and develop than constantly buying or trading for established players. Therefore, the league needs to take steps to promote internal team building. Here are my best suggestions, in general terms.

First off, there needs be an incentive granted to teams re-signing their own players. There's two stages where this should be done, the RFA stage and the UFA stage. I'd like to see teams granted a provision where, if they are re-signing their own players, they are granted a kind of discount on the cap hit on that contract, say 75%. Let's say that after two more seasons Sam Gagner has impressed the Oilers enough to warrant an extension. The Oilers sign him to a five year, $20 million contract, yet because they are re-signing their own player the cap hit isn't $4 million/yr, but rather 3$ million per year. Gagner makes the full salary so the NHLPA is happy, but it only counts for 75% against the cap, granting the Oilers an advantage in contract negotiations. Let's say Gagner signs an offer sheet with Anaheim for that same contract, Edmonton could match but while Anaheim's cap hit would be 4$ million if Edmonton passes, it would only be $3 million if they matched. Same thing at the UFA stage. Let's say Gagner gets a pile of offers from other teams for $8 million/year (this is assuming Sam Gagner becomes Joe Sakic of course). Edmonton can offer 25% more money per year for the same salary cap hit, thus giving them an advantage in any negotiations. If Edmonton trades Gagner during his contract, his new team absorbs the same 25% cap discount. This way, teams have the upper hand in negotiations with their own players. If the player just doesn't want to player there, then he walks anyways. This would mean less RFA poaching and thus teams could keep their players through at least a second contract. If the player wants to leave, the team trades them.

My other suggestion is to simply lengthen the entry-level contract to up to five years, since if you're lucky enough to draft a Crosby or Stamkos or Tavares the team should at least have the option of signing them for longer than just three years. The rationale behind the three year rule was to keep salaries lower until their later years, but with an increasing willingness (probably) for GMs to go after RFA's those top young players will be poached for big money early in their career anyways. Give GMs an extra two years but raise the minimum salary, since if you put in the discount clause there's going to be less RFA poaching, and thus big salaries for young players won't be as high. They get a little less later and little more sooner.

The other thing that'll happen is that players will have a little less control over where they play, since the team that drafted them will have that signing advantage. Yet with more players getting no-trade and no-movement clauses in their contracts, the playing field is a little more even on the management side and player side. Teams spend money scouting and developing, it's only fair they have some tools to retain those assets. Besides, often players on longer contracts are often more appealing to trade for since contract length adds certainty to the asset. Whatever you think about the Pronger trade, there's no way Lowe gets as much as he does if Pronger wasn't signed for four more years. Trades might actually be easier if these suggestions went into effect; you'd presumably have more long-term deals for less money and teams wouldn't be constantly faced with trade offers involving impending free agents for players under longer contracts.

Of course, nobody knows what GMs will do with new rules. The conventional knowledge after the lockout was that players would change teams a lot more frequently due to short-term contracts and more free-agency. Players are moving more, but now we're seeing the kinds of long-term contracts that have never existed before, like the 15 deal for Rick DiPietro, 12 years for Ovechkin, and 12 years for Mike Richards. One would have thought that with a cap GMs would hedge their bets a lot more and be unwilling to commit valuable cap space to anyone other than the absolute upper echelon, but they've done the opposite and thrown long-term deals at any B-rated free agent (like a Chris Drury or Ryan Smyth) that comes along. So while it's impossible to know what affect those proposed changes would have, I think the goal of creating a CBA that allows teams to remain dominant based on non-financial factors, such as drafting and shrewd trading, is one the NHL needs to pursue.

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