Skip to main content

NHL Commissioner Gary Bettman speaks during a news conference before Game 1 of the NHL Stanley Cup Final hockey series between the Los Angeles Kings and the New York Rangers on Wednesday, June 4, 2014, in Los Angeles.

Associated Press

Get ready for a skyrocketing salary cap in the NHL, even before the league's new Canadian TV deal gets factored in.

According to a report on Monday from Chris Botta of the SportsBusiness Journal, NHL revenues for the 2013-14 season are expected to hit $3.7-billion, which would be a 12-per-cent increase over the league's last full campaign.

With the new TV revenue added in a year later, meanwhile, that figure will for the first time crack the $4-billion mark in 2014-15.

Story continues below advertisement

That's obviously a good business story for Gary Bettman and Co., but the more pertinent result of much higher hockey-related revenues for fans (and general managers) is the impact it'll have on the cap.

As a reminder, the basic formula for calculating the NHL's cap under the new CBA is:

((Half of total revenue - player benefits) / 30 teams) x cap inflator x 15 per cent

Revenue we have a pretty good idea of due to Botta's report and others. I'm told by multiple sources that player benefits are projected to be approximately $120-million, a noteworthy rise due to some of the concessions players got from the league during the lockout.

The inflator is an optional 5 per cent boost that is almost always in play and the 15 per cent takes you from what's known as the midpoint to the ceiling.

So if revenues come in at exactly $3.7-billion, next year's cap would be roughly $69.6-million.

If they rise to $4-billion a year later, the cap climbs to nearly $76-million for 2015-16.

Story continues below advertisement

(The floor in both cases is approximately $18-million to $20-million lower.)

Those cap numbers are both a bit higher than what we had been hearing previously, as a dip in the Canadian dollar was expected to potentially limit its growth.

That extra $1.5-million or so for each team will make for an even crazier free agent period starting July 1, as there's not a whole lot of high-end talent available and many teams will be desperate to use some of those new dollars.

Matt Niskanen, among others, is going to become a very wealthy man.

Higher revenues also mean that players will take less of a hit due to escrow. All season, they have had 14 per cent of their paycheques withheld as part of the league's linkage system, but it's expected they'll ultimately only end up having to forfeit somewhere in the neighbourhood of 8 or 9 per cent of their salaries.

That $150-million loss can then be made back up through the "make whole" provision that became a contentious part of the lockout, although it'll fall to the NHLPA to decide precisely what they'll do with that money at their summer meeting.

Story continues below advertisement

Any escrow pain players feel, in other words, could quickly be alleviated with a lump sum payment.

Credit for all this goes to the league's strategy of six outdoor games and to the simple good fortune of having four huge markets in the final four. Add in a World Cup of Hockey in 2016, and there should only be good news on the HRR front for the foreseeable future.

At least until the next lockout approaches…

Report an error Editorial code of conduct
Comments

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff. Non-subscribers can read and sort comments but will not be able to engage with them in any way. Click here to subscribe.

If you would like to write a letter to the editor, please forward it to letters@globeandmail.com. Readers can also interact with The Globe on Facebook and Twitter .

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff. Non-subscribers can read and sort comments but will not be able to engage with them in any way. Click here to subscribe.

If you would like to write a letter to the editor, please forward it to letters@globeandmail.com. Readers can also interact with The Globe on Facebook and Twitter .

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff.

We aim to create a safe and valuable space for discussion and debate. That means:

  • All comments will be reviewed by one or more moderators before being posted to the site. This should only take a few moments.
  • Treat others as you wish to be treated
  • Criticize ideas, not people
  • Stay on topic
  • Avoid the use of toxic and offensive language
  • Flag bad behaviour

Comments that violate our community guidelines will be removed. Commenters who repeatedly violate community guidelines may be suspended, causing them to temporarily lose their ability to engage with comments.

Read our community guidelines here

Discussion loading ...

Due to technical reasons, we have temporarily removed commenting from our articles. We hope to have this fixed soon. Thank you for your patience. If you are looking to give feedback on our new site, please send it along to feedback@globeandmail.com. If you want to write a letter to the editor, please forward to letters@globeandmail.com.
Cannabis pro newsletter