Note to NHL GM’s – This is Getting out of Hand

Ilya Kovalchuk signed an unprecedented 17 year contract on Monday

If you have ever wondered what it is like to run a circus you can just ask NHL commissioner Gary Bettman.

Since the implementation of the hard cap in the NHL, teams have started giving contracts that are almost as crazy as an elephant on the high wire. These outrageously long contracts are being given to players with the benefit of having a lower cap hit, albeit for a longer period of time. Having a cap in the NHL is a great thing but the ringmaster’s of this operation are soon going to be sorry for their short-sightedness.

Lou Lamoriello, who is known as one of the most shrewd general managers in the NHL, did something very un-Lou like yesterday by signing Ilya Kovalchuk to a massive 17 year contract worth approximately $102 million. Kovalchuk, who was probably the most sought after free agent this off-season, had been rumoured to be close to a long-term deal with the LA Kings a couple of times. It was also reported that he had turned down a 10 year $100 million contract extension last year from the Atlanta Thrashers.

Are you kidding me? Kovalchuk is a point a game guy who is not an experienced playoff veteran. You’re telling me he’s worth $100 million over 10-17 years?

For the most part, this off-season has been filled with more reasonable contracts, but the unprecedented Kovalchuk signing may just be the freak show that NHL GM’s needed to wake them up from this dream.

In the business of sports, winning now is one of the most important things to fans and owners alike. However, the price for winning sometimes comes at a great cost to the future.

These long-term contracts look all fine and dandy when players are in their prime and performing at optimum levels, but what happens when their play starts to digress little bit by little bit?

What is going to happen is that 5 or 6 years down the line, maybe less, these players that are being signed to double-digit contracts in the prime of their career are going to start receiving a lot of criticism for not playing to the level of their contract.

Johan Franzen was signed to an 11 year contract worth $43 million dollars at the age of 29. His best season consists of 34 goals and 25 assists in 71 games, which is less than a point a game. Franzen is undoubtedly a valuable player to the Detroit franchise, but at a cap hit of $3.9 million annually it is not going to be a bargain in the years to come.

Johan Franzen and Henrik Zetterberg both signed double-digit year contracts

What about Henrik Zetterberg? At 28 years old he signed a 12 year deal worth an estimated $73 million for a cap hit at around $6 million per year. Zetterberg can be a plus point a game guy for a team, and is one of the best wingers in the league. However, once he starts reaching the age of 34 or 35 you are going to start to see his play drop to some extent.

Oh yeah, what the heck is a team supposed to do when their player is not performing at the level expected of them even at the supposed peak of their career?

The Tampa Bay Lighting and the Vancouver Canucks have already started to see the error of their ways in the signings of Vincent Lecavalier and Roberto Luongo respectively. In the last two seasons, Lecavalier has already started to show some possible signs of aging, where he scored 67 and 70 points while failing to reach the 30-goal mark. At the age of 30, who knows if we will ever see the old Vinny ever again.

Robert Luongo is also in the same boat, as his play has been weaker his last couple seasons in Vancouver. At a cap hit of $5.3 million, the contract is sure not looking like much of a bargain at this point.

When they signed Luongo to that 12 year contract, the Canucks had Cory Schneider waiting in the wings, who is now finally that backup goalie to Luongo. However, with very good AHL numbers you have to believe that taking a chance on Cory Schneider with a rookie contract cap hit would have been the better idea. With the extra cap space, the Canucks may have been able to acquire some better quality skaters.

When these players with big contracts stop performing at their top level, it isn’t just going to be that they are getting paid too much. Suddenly, the cap hit that seemed like such a shrewd move, is more of a garbage decision than anything.

Mark Messier was a big disappointment to Vancouver Canuck fans

If you look at some of the all-time greats there are only a select few that performed comparably to their glory days. You cannot fight age, and with these long-term contracts it should be expected that guys will have injuries that hurt their longevity. Once Mark Messier went to the Vancouver Canucks at the age of 36 his play dropped dramatically.

You can tell me that guys like Wayne Gretzky and Gordie Howe were able to play well later in their careers. Then are you trying to say that Hossa, Kovalchuk and Zetterberg are in the same class as these guys? Gretzky dropped from 100+ to 90+, that’s a big difference than 80+ to 60 or 70+ points.

Teams are throwing away their opportunity at future success by signing players to these ludicrous contracts, and leaving their teams only a small window for a chance to lift the Stanley Cup.

Imagine if the Chicago Blackhawks had not won the Stanley Cup this past season. They would still have their core four players of Kane, Toews, Keith and Seabrook, but they have had to trade and let-go of some of their key role players.

Their ability to win a Stanley Cup makes the move a success in my eyes because of the degree of difficulty it takes to win just one championship. But the ability to build a dynasty is almost out of the question. We talk about their core four, but there are also the underachieving Brian Campbell and Marian Hossa who are both in the midsts of eight and twelve-year deals respectively. You aren’t going to win many Stanley Cups with six players.

All of these contracts are constantly setting a precedent for future ones, which almost inevitably means an endless cycle of brutally long contracts. General Manager’s are digging a deeper and deeper hole for themselves to get out of, and it will eventually culminate in their demise.

Things are getting out of hand and if the NHL isn’t going to do anything about it, the only way to stop it is for every single one of the GM’s to refuse to give the contracts that the players are demanding.

This might mean that your team is not going to get the player it is looking for right now, but it will save your franchise 5 or 10 years down the road. These players do want to play, and if no one gives them the contract then they are going to have to settle for something less. Be strong and don’t give into the temptation of the lucrative deals.

Act 1 of this show has been quite spectacular and act 2 may turn out just as good. But ringmaster’s are warned that these later acts will dull as father time works his magic.

Agree? Disagree? If you have any questions, comments or suggestions, please feel free to reply in the comments section below. Or you can e-mail me at cross_can15@hotmail.com. I’m now on twitter follow me @paintstheblack and I will gladly return the favour.

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37 Responses to Note to NHL GM’s – This is Getting out of Hand

  1. onlinegamblingsecrets101 says:

    Hey thanks for the reply on my article. How did you hear about my website?
    Also I feel as Ilya is worth the 17 years

  2. Andrew Macaluso says:

    Great read, Chris!

    I really don’t think Ilya is worth 17 years, especially when the guy doesn’t show up in the playoffs, you know the place that separates the men from the boys.

    Like my article says, he sold his soul to the Devils.

  3. manderichia2 says:

    These contracts became so popular because they benefit both player and organization. The player has the opportunity to capitalize on their full potential, and the team can soften the cap hit. That being said, as a New Jersey Devils fan and blogger, I don’t believe 17 years was the best option. Maybe 10 or 12 years, but 17 years is quite excessive.

    We all know that if Kovalchuk goes on to win a few Stanley Cups, then the fans and organizations will look on it as a positive signing. But it will be interesting to see exactly how a contract of this magnitude will affect the franchise in the future.

    Not to give a shamless plug, but my article on the signing is here for a read: http://bit.ly/d6fjeG.

  4. howigit says:

    No athlete in any sport is worth 17 years — it’s just far too risky — except maybe ping pong.

  5. Great article Chris!

    I would like to see a lower base salary with incentives for goals, assists, plus/minus, games played, etc.

    Sports and money has gotten out of hand (look at the price of your tickets). I would like to see players hustle more to make the bucks. In my opinion, most players are becoming too relaxed and forgetting how to be role models to our kids.

    The Sports Archives
    http://www.thesportsarchives.com

  6. Jack says:

    Great read Chris. Couldn’t agree more.

    The NHL has been in this mess before. Teams can’t spend beyond their means and expect to have good things happen. Obviously, a team needs stars to market themselves, but what fans really want is a winner. The teams that sign players to these long-term deals have mortgaged away the future to try and win now. If it doesn’t work, then they are caught between a rock and a hard place.

  7. Ryan Nellis says:

    Thanks for the comment on our new blog. I agree with you completely. These contracts are made for one reason and one reason only: the money. It is nothing but a loophole that GM’s are exploiting to lower their annual cap numbers. I couldn’t help but laugh at Kovalchuk saying in his press conference today that, “I hope to be playing when I’m 44.” Seriously? Don’t insult us. We all know what’s going on here. Lou even came out and said that the contracts are ridiculous, and that they shouldn’t be in the league. Talk about being hypocritical.

    In two years, when the CBA is up, this problem will be fixed. Or at least attempted to be fixed. Will the lesser tier players stand up and be recognized and side with the league? Or will the handful of superstars control the roost? We’ll just have to wait and see, I suppose.

  8. Tom Brubeck says:

    I like your use of several examples of current players who have not deserved their lengthy contracts. As someone living in Chicago, I would say that I feel some remorse that the Blackhawks had to give up Big Buff and Sopel among others to keep an inferior player like Campbell, but I hesitate to change anything when a Stanley Cup was the end result this season.
    While researching this topic, I found that the longest contract in North American sports history was between Magic Johnson and the LA Lakers- a 25 year deal signed in 1981. Sometimes, I guess these things do work out pretty well even when the player doesn’t play out the entire contract :)

    • nicedummy says:

      One million a year for 25 years: not a bad deal for owner Jerry Buss. At the time it wasn’t a bad deal for Magic. Can you imagine one of today’s players signing for something like that.

  9. Tate says:

    Although it will be difficult, Chicago’s top guy on the trade block has to be Brian Campbell. In fact he should only reinforce the fact that if a guy has a good year in Buffalo he will never live up to that(See Also Briere and Drury).
    The thing with these contracts is that although Kovalchuk carries a cap hit of only 6.5(which is a steal at this point) he will make 10 mil a year for the first 8 years and then declining progressively for the remainder. So by the 17th year he will make probably the league minimum. Hossa’s is the same way. These front loaded contracts have become the top priority for the meeting when the CBA is up. This could cause another strike.
    I say allow teams to give these front loaded contracts to players that they are re-signing. A team should be given some leeway when it comes to retaining talent. Now when it comes to acquiring new they should have limits. I’ve heard that it might become that no yearly salary can be less than 50% of the highest salary within the span of that contract. The NBA already has rules in place to make it easier to retain talent though their “soft cap” has become something of a joke.

  10. allieseymour says:

    I think the Devils are going to regret the contract. It’s exactly what you said. What happens when he can’t live up to expectations that are placed on him. Or can’t keep playing at his top level. Then what? I mean he could have settled for a ten-year contract. 17 years though? That’s crazy. He’ll be 44 when the contract ends. These contracts are simply ridiculous.

    I really liked your example that you used in your article. Great article!

  11. ronmycholuk says:

    I agree completely with your points. Forget the length, forget the pay. He is below a number of other players and he’s getting paid like the best player in the league. There isn’t a chance he plays until he’s 44. And ask the Islanders if they could go back in time and re-do the Dipietro deal. In my opinion, 5 should be the max.
    The league needs to step in and not allow these contracts anymore. All they do is circumvent the cap and start to cause the same problems that started the lockout originally.

  12. Tate says:

    The best part is that Lamoreillo has been outspoken against these crazy contracts. He said he didn’t approve of the DiPietro or the Ovechkin deal.

    • jaa001 says:

      However, it’s crystal-clear that both of those contracts weren’t designed to circumvent the salary cap. And, in fact, only one of them is a bad deal (hint: it isn’t Ovechkin’s).

  13. He clearly will not be playing with the Devils for 17 years. Lou and Kovy know that, hence the front loaded contract, and the peanuts at the end. The Devils get a great player with a minimal cap hit for several years, and when enough is enough they buy him out at a low price. Brilliant.

    • pacinofan says:

      I’m pretty sure the way the CBA works is that they take thr average of the contract as the cap hit, but I could be wrong.

      • Tate says:

        You are correct but the cap hit and what the player makes isn’t necessarily the same. Hence why despite a cap hit of 6ish he will get paid 10 mil a year for the first 8.

  14. pacinofan says:

    Great article! I wonder if Ilya will ever get one of those mystery injuries that Mogilny got that enabled the Devils to cheat the cap a few years ago.

  15. nhlsource says:

    Hey Chris,
    thanks for commenting on my blog. Great post here and I’m glad someone finally shares my view that these ridiculous 10+ years contracts are completely worthless unless the player is in his early 20′s and is producing like a Crosby/Ovechkin type. And just when you think it can’t get any worse, the most ludicrous deal I’ve ever heard of is signed in a salary cap era to a player who is good, but just not worth it. Kovalchuk will be 44 when this deal finally finishes, and you can’t make me believe he’ll still be a 40+ goal scorer. To be perfectly honest, I think Kovalchuk’s production is going to have dropped drastically by the time he’s mid-30′s (I’m guessing 15/20 goal scorer, maybe 25 if he’s really good). Anyway, great article, i’ll be sure to check out your blogmore often. Thanks

    http://nhlsource.wordpress.com/

  16. CJ says:

    He’s not worth 17 but don’t forget he won’t be playing all 17 of them. Do you think he’s going to be willing to play those final few years of his contract which will pay him just pennies compared to what he makes early on? He’ll probably retire before the age of 40. In that case it would probably be considered a good move by the Devils.

    There are so many variables that will determine if this is a good move or not it’s too earlynto tell right now.

  17. Awesome read.

    The majority of the stigma associated with these long-term deals usually involves the number of years, but in the era of a salary cap, decade-long deals are the best solution to alleviate the cap hit and provide the player with his money as well as the GM with enough financial flexibility to assemble a team around that player. While it can certainly be interpreted as circumventing the cap, long-term deals currently stand as the optimal solution to meeting both a player’s and team’s financial needs.

    Moreover, while contracts exceeding a decade may seem like a commitment for eternity, any GM would be content with short-term success regardless of how the player performs in the final years of the deal. Undoubtedly, Stan Bowman wouldn’t trade his Stanley Cup ring with Chicago for some extra cap space.

    Due to the amount of parity in the league, which is most attributed to free agency and the salary cap, General Managers are desperate to sign the three or four supremely talented players in a free agent class to ensure their team’s short-term success. Repeat champions will almost certainly be an anomaly in the free agency era, so GMs are willing to spend the extra cash to ensure a run for the Cup.

    As others have mentioned, the Kovalchuk contract is not as unreasonable as it appears to be; a $6 million cap hit is pretty damn affordable for a two-time fifty goalscorer, and Kovalchuk’s cap hit is less than 39 other NHL players (including Wade Redden and Chris Drury). Additionally, the Devils have a one-year window following the eighth year of the deal in which they can trade Kovalchuk after his no-movement clause expires in the Summer of 2017 before a no-trade clause goes into effect in the Summer of 2018. Contrary to popular belief, while the Devils currently find themselves over the cap, the Kovalchuk signing does not hinder their chances of re-signing Zach Parise, as more than $11 million of salary come off New Jersey’s books next summer.

    Obviously, this is an incredibly unorthodox move for Lou, but given Kovalchuk’s commitment to a team-oriented Devils philosophy, this deal could very well be worth it.

    • Tate says:

      Very true. In fact if Parise’s time with the Devils is almost over then it is by his chose, not Lou’s. The thing I wonder is what happens if after 8 year they haven’t won a Cup. Is the Kovalchuk signing something that will be seen as a complete sham if it doesn’t equal a cup?

  18. Tate says:

    This may not matter. TSN reporting that the NHL has/will reject the contract.
    http://www.tsn.ca/nhl/story/?id=328025
    This could be a huge legal battle, as the CBA doesn’t specifically outlaw this contract

    • Cana the Band says:

      I have a feeling the NHL knows they’ll be forced to approve it but want to send a message. Should be interesting to see what happens with the new CBA.

  19. KDog13 says:

    Yea, the Deal was voided

  20. Cana the Band says:

    These contracts are getting a bit out of hand, but if you’re Lou why not? Pronger, Keith, ect. all have contracts that they probably won’t finish either. Hossa’s under contract until 42 so is the extra two years really that big of a deal? Chris Chelios is still playing at 46. It’s a loophole in the current CBA and I’m sure something will be done about it. If the Blackhawks can have multiple players with these deals why can’t other teams?

  21. Tate says:

    So this whole “Rejected” deal basically means they have 5 days to restructure the day to make the difference between first year’s salary and last. Will probably turn into a 15 year deal.

  22. Well as ridiculous as is sounded, it is no longer a deal until the Devils figure it out and make another silly offer to him. Maybe 17 years for only 100 Million, what a paycut it would be.

    Being a Bruins fan I wanted Kovalchuk bad last year, but I am glad this mess of contract talk won’t be on the Bruins books.

  23. I’d suggest a ban of contracts longer than eight years. That’s plenty of time, and, should these players continue playing well until the end of those eight years, they would be able to score another big-money deal. It’s win-win. The team brass doesn’t have to sacrifice the future for a couple good years and the players get the money they want. And, if they decline, they might realize it’s a good time to hang up the skates anyway.

  24. Although it will be difficult, Chicago’s top guy on the trade block has to be Brian Campbell. In fact he should only reinforce the fact that if a guy has a good year in Buffalo he will never live up to that(See Also Briere and Drury).The thing with these contracts is that although Kovalchuk carries a cap hit of only 6.5(which is a steal at this point) he will make 10 mil a year for the first 8 years and then declining progressively for the remainder. So by the 17th year he will make probably the league minimum. Hossa’s is the same way. These front loaded contracts have become the top priority for the meeting when the CBA is up. This could cause another strike.I say allow teams to give these front loaded contracts to players that they are re-signing. A team should be given some leeway when it comes to retaining talent. Now when it comes to acquiring new they should have limits. I’ve heard that it might become that no yearly salary can be less than 50% of the highest salary within the span of that contract. The NBA already has rules in place to make it easier to retain talent though their “soft cap” has become something of a joke.
    +1

  25. Big Joe says:

    I suspect that Lou Lamoriello may have actually been expecting the contract to be rejected. By agreeing with Kovalchuk’s agent to a set of terms where the only way the Devils could manage to accommodate the $100+ Million asking price was to spread the cap out over 17-years Lou has put himself in an excellent position to renogotiate the deal at a more suitable term and rate. If Kovalchuk does not agree to a more Devil’s friendly cap structure and opts to try and sign elsewhere his perceived value is decreased by the NHL rejection of the original terms of the NJ deal and the total asking price may be forced down. And Lou also knows there are other players out there and sign and trade deals happen all the time so he could probably find more offence at better value than Kovy seems willing to offer.

    You never know….

  26. puckking says:

    Wouldn’t have made more sense for Kovalchuk to take a 10year/100million contract. At 10Mil a season for 10 straight seasons…..unless he knew he wasn’t going to stick around that long (in which case he gave the League a reason to reject this contract)…or Atlanta was bluffing…or probably the most likely reason he wanted the heck out of Atlanta.

    It’s going to be interesting to see how they go about changing this in the next CBA….

  27. George says:

    Hey Chris, read my 2 latest articles involving this whole Kovalchuk contract rejection, might make it a little more clear.

    http://onlinegamblingsecrets101.com/category/nhl-news/

  28. nicedummy says:

    Good read, Chris.

    I thought Puck Daddy on Yahoo had a great view on the Kings approach to Kovalchuk. For as much as the Kings have been building their team and looking how Chicago’s done it (save for the Campbell and Huet deals), the reason they didn’t offer more and end up with him was precisely because of Chicago’s situation next year.

    The Kings have three RFAs next year that Lombardi didn’t want to jeopardize: Doughty (now him I’d sign for 17 years), Jack Johnson and Wayne Simmonds. Now, sure I might want Simmonds more than Kovalchuk but a contract like that doesn’t simply endanger next year’s RFAs but future years as well. It will be curious to see what his eventual cap hit does to the Devils (I believe he will be a Devil). It may not endanger signing Parise but if Kovalchuk’s cap hit goes up a million or two, now the Devils have 12 players signed next year for ~ $43 million, without Parise.

    I’m not going to go Dan Gilbert on Kovalchuk but with Marty at age 38, I wonder about the size of the Devils window.

  29. Frostee says:

    I can understand the cap circumvention that the teams are aiming for, but I really don’t understand why teams think it’s worth restricting themselves by signing these deals. And let’s face it, Kovalchuk is NOT worth that money. Even if the best players in the league signed contracts like that I would think it was ridiculous and excessive, and for an unproven big-game performer like him it’s obscene.

  30. Josh Sanders says:

    If he played all 17, he’d be 44. This deal is massively middle loaded. They take an average for the cap anyway. They pay him next to nothing on the back side. If he retires, they don’t pay him. It’s simple. I like the really long term deals. They ensure that he is a Devil for the rest of his career.

    This is so much better than the deals that the NFL and NBA do. Every 3-4 years it’s the same thing. And thank God we’re not seeing hour long “The Decision” specials on ESPN for hockey.

  31. Pingback: It is too early | Chris Ross' Painting the Black

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