CrashingTheGoalie

The NHL, NBA, and MLB all have revenue sharing: all three differ dramatically.

Revenue sharing is, of course, a concept based on the premise that a league is as good as its weakest link. Therefore, the strong franchises should help the weak. This is true of economics, as well as talent, but to different degrees in the different leagues.

Now everyone likes revenues sharing, however. Some don’t want to give any of their money to other teams. Some don’t want give their money to other teams, who will take it, and compete with them for better players. And, others believe that it is like a form of welfare – they won’t learn to stand on their own two feet – they’ll just become lazy.

NBA president of league and basketball operations, said, “This is a subject without true consensus.” Litvin added that most teams “were satisfied, but not happy, with the outcome.”

The vote passed by a “comfortable margin,” among the 30 team owners.

“To me, our thinking is completely backward,” Clarke said. “I lost Kim Johnsson to (unrestricted) free agency because the Minnesota Wild gave him $4.8 million. Well, the Flyers had to give (revenue sharing) money to Minnesota and other teams and I don’t like that but it’s the rules. And then Minnesota takes that money and signs my player and there are no rules to say I can keep him if I match.”

NHL-HIGHLY STRUCTURED-KIND OF UNREALISTIC-

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NBA

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I think MLB needs a salary cap, or something that helps balance the talent among the teams.

The league does have the “luxury tax” rule that requires some revenue sharing to better balance the owners income that can be used for signing players. However, it’s never worked as projected as an alternative to an annually fixed salary cap like the NFL uses.

All MLB owners are millionaires or billionaires, so it’s difficult to feel sorry for the ones that can’t or won’t spend as much.

The owners willing to spend the big money can still sign the proven free agents and pack their team with all stars and higher quality players. You don’t have to look any farther than the AL East to see how that is working.

I think this disparity in how much money teams spend has a detrimental affect on the game. Lower tier teams are less likely to spend resources developing minor league talent, since they know they’ll only get a few years production from the guys before losing them as free agents to a team that has the big bucks.

So what we see is owners staffing their core teams with average to mediocre players, then trying to sign two or three stars to make the teams competitive with the Yankees and Red Sox. It might work for a year or two, but it’s not a good way to build a consistent winning team.

http://www.bigcatcountry.com/2009/7/19/954781/how-the-nfl-owners-see-the-nfl

The National Football League’s 32 teams are somewhat insulated from global economic fluctuations — and bad seasons — because the league’s revenue-sharing policies split among the teams the more than $20 billion-plus the NFL gets from its various multi-year television, cable and satellite deals.

However, the revenue-sharing payments, believed to be more than $100 million per team, haven’t covered player payroll in recent years, meaning teams have to rely on other income streams — merchandise sales, tickets, suites, etc.

So when a team loses, that revenue drops.

The Detroit Lions, for example, failed to sell out five of the last six games at 65,000-seat Ford Field, and the team’s merchandise sales have never cracked the top 10 on NFLShop.com, the league’s official online retail site.

The Lions won’t discuss finances and disputes the analysis by financial news Web siteForbes.com that the team had negative $3.1 million in operating income on revenue of $204 million in 2007 (the most recent season studied).

If the numbers are accurate, it’s logical to assume the winless 2008 season didn’t improve the Lions’ finances. The team also will face an uphill battle as it looks to season ticket and corporate sales renewals after a horrible season and in a terrible local economy.

Detroit isn’t alone in suffering. Even teams that sell out every game, such as Washington and Cleveland, cut front office staff in recent months as franchises and their fan bases weather the economic downtown. NFL headquarters cut nearly 170 jobs this year.