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02 August 2007

Penner's new deal with Oilers an ominous sign for NHL...

Various media sources are reporting the Edmonton Oilers have officially signed former Ducks forward Dustin Penner to a 5-year/$21.5 million contract.

The young sniper played in all 82 games for the Stanley Cup champions Ducks last season, scoring 29 goals and adding 16 assists for a total of 45 points and 202 shots on goal.

The signing occurs a few weeks after Lowe made a bold move in signing the Sabres' Tomas Vanek to a $7 million per season offer sheet, only to see Buffalo GM Darcy Regier match within 19 minutes.

The 6'4'', 245-pound Winkler, Manitoba native just scored big time in the bank, and the NHL should be worried.

A few years down the road, maybe, just maybe he'd be worth the money he just got from a desperate Kevin Lowe...but at this point in his career? A 24-year old sophomore with a season and a quarter under his belt making a little over $4 million per season seems too much like the old NHL, where GM's paid wildly for any hint of talent available to them.

Scott Hartnell, who recently signed a similar pact with the Philadelphia Flyers, belongs in that pool of "paying for potential, not production" players. Both Penner and Hartnell will earn $4.2 million annually for the next 5 and 6 seasons respectively.

So what does this mean for the future RFA market?

For starters, teams may be tempted to sign future restricted free-agent Jason Spezza to an offer sheet next summer, and with the Senators trying to hold on to potential unrestricted 50-goal man Dany Heatley as well, someone may very well succeed in prying him from Sens GM Bryan Murray's hands.

But not so fast, this signing of Penner is also an ominous sign.
A sign that the NHL is heading back to its old days of overpriced free-agents and overrated players...I'm starting to wonder why we lost a complete season of hockey and why Gary Bettman and the NHL are so STUBBORN not to realize what's going on.

It was a mistake to make the cap rise again to $50.3 million, if the NHL knows what's good for their league finances and fans, they'll lower that number to $45 million next year and leaves GM's little room to spend the $7 million Chris Drury got, and the $10 million Dany Heatley will likely get if this continues next year.
They won't lower the cap, so scratch that.

If they actually used their brains, they'd finally figure out that the more the cap raises, the more salaries for elite players will go up, and the more we'll be drifting back to the pre-lockout era and a potential lockout/labour dispute again.

This signing not only makes the RFA market a whole new attractive destination for GM's, and a headache for the NHL, but it also marks the end of the Brian Burke-Kevin Lowe friendship, at least according to Burke's recent harsh words to the media.


8 fanatics have replied:

Norman Rochefort said...

The cap went up, because revenues went up. Why shouldn't the owners have to spend some of the money they make on players? I've never understood why we should cater the league to billionaire owners who don't want to spend money to put a good product on the ice. I also don't understand why we have to keep changing the rules to protect teams from themselves. The cap will appropriately go up or down based on the financial success of the league. Teams like the Rangers and Flyers are invested in free agents long-term, so they won't be players in the FA market for years. So, there's no guarantee that teams willing to spend money will be the teams with the cap space each off-season. So, the market will not be set by Penner's contract as much as it will be set by which teams have cap room each summer. Tom Golisano is a billionaire. He certainly could have afforded to pay Drury and Briere. Why is it the fault of the Rangers and Flyers that they did what Golisano should have done? Bettman closed down the league for a year to get a hard cap linked to revenue to cater to the worst owners in all of sports (like Jemremy Jacobs and "Dollar" Bill Wirtz), and now, that's not good enough for these guys? If an owner doesn't want to spend money, sell the team. But, don't force the rest of the league down the the lowest common denominator.

Bleu, Blanc et Rouge said...

I get that league revenues went up, but come on, can't they do something besides raising salaries to outrageous levels each year?

Bleu, Blanc et Rouge said...

And also what you're suggesting is ENTIRELY old NHL.

Paying generously for elite free-agents usually depended on how much money owners had in their pockets.

And Bill Wirtz is a disgrace to sports, but he's no worse than baseball's Jeffrey Loria (who took my Expos!)

Anonymous said...

Gary Bettman is an idiot and has screwed up the NHL beyond belief.

Anonymous said...

There's nothing ominous about this. Penner got overpaid but its not like that hasn't happened 20 times already this offseason.

There is a capped amount of money to be spent by each team; the idea that a contract like this has an inflationary effect on league salaries is nonsense. Yes, it may result in more players of Penner's calibre getting this kind of money. But that money has to come from somewhere else, because spending is capped. So, some other players are going to get less money because of this.

The effect you're going to start seeing is younger players in the early prime of their careers are going to start getting some serious money, while aging has-beens will stop getting nearly as much. And really, what's wrong with that. Why should the Vaneks and the Getzlafs and the Phaneufs play for $2 million so that players twice as old and half as effective can make $4 million? It should be the other way around and that's what we're going to start seeing. Lock up your young stars for good money while the older guys pick up the scraps.

Anonymous said...

Linkage, linkage, linkage!


"I get that league revenues went up, but come on, can't they do something besides raising salaries to outrageous levels each year?"

No, they can't. The players get 55% of the league revenues. Revenues go up, cap goes up. Period.

If we end up with some ridiculous contracts that totally break the balance of the league, people will vote with their wallets, the revenues go down, and the cap goes back down.

Anonymous said...

The one way the owners have to control the salary cap is to play with the revenues. If they really want salaries to go down, they could lower their ticket prices - which in effect would lower the league revenues and thus the payroll number.

Now ask yourself if the owners would consider lowering ticket prices to accomplish this. Or instituting a 'ticket price cap' to go along with a salary cap, ensuring an affordable product for its fans.

As it is now, players should get that money. Never once has George Gillett done an end-to-end rush that pulled me out of my seat.


1) We agree that penner and Vanek got WAY more than they deserve, but it won't have an 'inflationary' influence on overall salary levels, BUT it will cause teams to over pay for guys in their early mid 20's and have to short change the older guys.
2) The days of multi million dollar contracts for old washed up guys like a 37 yr old Mark messier are essentially over

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