• Parity

    by Tyler Dellow • April 4, 2012 • Hockey • 16 Comments

    I was looking at the goal difference numbers the other day and happened across something interesting. Edmonton is almost certainly going to finish 28th or 29th in the NHL. The Oilers, however, have a goal difference, net of empty netters and the asinine SO goals that the NHL includes in the official totals to pretend that offence is up, of -15. We’d usually expect that to put a team at somewhere like 77 points over a full season, plus whatever they can add in OT or the SO. Call it 85 points. Someone on Twitter pointed out that Montreal’s number is even better – they’re tied for 16th in the NHL in net goal difference with -7. They could plausibly get that to zero and pick 28th. Insane.

    This got me wondering about how the best and worst goal differences in the NHL have changed since the new CBA. I’ve had a theory, which I’ve never gotten around to testing, that the range between best and worst would begin to narrow as time went on. Very simply, the idea is that under the old CBA, you could do an actual rebuild in which you didn’t bother spending money on guys who could play hockey but just flat out sucked. Teams did this. Under the new CBA, you can’t really do that – you’re forced to have a cap hit within $16MM of the ceiling. This should, in theory, sforce the hockey talent to spread out.

    And it looks like theory is backed up by reality. What I’ve done is split the league into six teams by goal difference – 1-5, 6-10, etc. I’ve then started in 2003-04 and gone to present, charting the goal difference for those groups. You can see that it’s converged significantly since 2003-04. (I assume this goes without saying but the dark blue line is 1-5 in goal differential, etc.) It turns out that there has been something of a convergence in strength of teams since the lockout. In 2003-04, the best five goal differential teams in the NHL were +265, the worst five teams in terms of goal difference -333. This year, pro-rated to 82 games, it’s +254 and -225.

    What’s interesting is how much more expensive it’s become to have a lousy hockey team. The change that’s taken place in goal difference is undeniable and large but…those teams still by and large don’t come close to the playoffs. In 2003-04, the average payroll on a bottom five goal differential team was $35.5MM. This year, it’s $58.1MM. A top five goal differential team in 2003-04 cost $52.8MM, on average. This year, the cost of such a team is $61.6MM. Call it a 6.4% increase, annually, for the bottom teams and a 1.9% increase, annually for the top teams. It’s a bizarre result of this CBA – owning a terrible hockey team has become much more expensive on a year by year basis.

    You don’t spend that money without some sort of result and, as you can infer, lousy teams are indeed now less lousy than they once were. I’m not sure that spending an extra $23MM annually for a 21 goal differential improvement is really worth it, from an economic perspective though. It’s generally accepted, I think, that you make more money by winning more hockey games. Cutting the margins between great and terrible doesn’t really do it. I sort of wonder if the cap floor has been responsible for some of the problems that we’ve seen teams have under this CBA. Phoenix, Atlanta, New Jersey and Dallas have all had serious financial problems. Columbus asked the city to bail them out. There are rumours about other teams. Under the old CBA, you could respond to a bad team by stripping it down, running it cheaply and collecting talent. That’s no longer an option here – you just need to keep pouring money into it. Revenue sharing will cover that to a degree but I don’t know that it’s enough.

    I wonder – and again, this is idle wondering, something I haven’t really checked – whether randomness starts to come into things a lot more as the margins between good and bad get smaller. It seems reasonable to expect that it would. As the margins get smaller because talent is more equally spread between teams because of financial constraints, there’s going to be less to separate teams outside of randomness. When this CBA came in, people were thrilled by the advent of parity; at the time, I kind of understood that to mean that all teams would have an equal chance to be good. What I didn’t realize was that it seems to have meant that virtually anyone could make the playoffs because talent is so equally spread between most teams that randomness will have a much more significant role in determining who makes the playoffs versus who has a horrible year.

    It’s an odd sort of a thing for a league to aspire to but maybe it makes perfect sense if you’re operating a cartel like the NHL. Any system in which any team can develop any sort of a long term competitive advantage will be opposed by the majority. What will be acceptable is a system in which randomness governs pretty much everything. It’s the logical endpoint.

    About Tyler Dellow

    16 Responses to Parity

    1. April 4, 2012 at

      A lot of people (and teams) are complaining about wanting a lower salary floor in the next CBA, so that you can build shitty teams on the cheap when you’re in financial trouble, or intentionally tanking, etc. Given the way you’ve railed against allowing (and even encouraging) teams to intentionally tank, I’m curious what your thoughts are on the issue.

      I don’t think the range between the ceiling and the floor ought to be extended – at some point, if you make that large enough, we might as well just go back to the old system, where some teams could spend 2-3x times what most other teams spent on player salaries. I’d be more in favor of making that range a little smaller, and pulling the cap down to accommodate the floor teams. I’m not sure how well that fixes the problem (eventually, cap will rise again, pushing floor teams up higher, again), but I find that or the status quo to be a lot more palatable than increasing that range between floor and ceiling so that shitbird teams like the Islanders can roll with bare minimum payrolls and start crying again about how the CBA is so unfair.

      Of course, ideally, I’d prefer corporal punishment within NHL front offices as punishment for spending 58M on a bottom-5 goal differential team, but I don’t think we’re getting that in the next CBA. Ultimately, I think a large part of the whole thing speaks to how acceptable failure is within the NHL and it’s front offices, and that sort of acceptance is what really needs to change.

      • dave
        April 4, 2012 at

        I dont know if I wouldnt prefer capital rather than corporal punishment

    2. April 4, 2012 at

      If you want to tank, why not trade a bag of donuts to a good team saddled with a terrible long-term contract, provided they toss in a pick or prospect?

      Think of all the money you’re spending not as salary for the marginal player you acquired, but rather money you’re spending to acquire the future talent that came along with them.

      • Wan Ihite
        April 5, 2012 at

        If you want to tank you shouldn’t take on a terrible LONG TERM contract, because that will leave you tannking for the long term. You want a highly over-rated player with only a year or two left.

    3. sacamano
      April 4, 2012 at

      It’s a bizarre result of this CBA – owning a terrible hockey team has become much more expensive on a year by year basis.

      I’d call that a feature, not a bug. It allows the fans and owners — at least in principle — to require more accountability from the GMs, who no longer have the twin excuses of (a) not having enough dough to get good players and (b) there not being enough good players available. More than ever, the choice of where to spend dollars distinguishes good GMs from bad (see the Oilers). How can this be bad? However, you are probably correct that the salary floor might have had the unintended consequence of making rebuilding both more expensive and more difficult. Still, my heart is not exactly breaking for them.

      What I didn’t realize was that it seems to have meant that virtually anyone could make the playoffs because talent is so equally spread between most teams that randomness will have a much more significant role in determining who makes the playoffs versus who has a horrible year . . . It’s an odd sort of a thing for a league to aspire to but maybe it makes perfect sense if you’re operating a cartel like the NHL.

      Odd? How so? If I’m the NHL, this is yet another feature rather than a bug. And not because they are a cartel, but because they are in the entertainment business. More teams able to make playoffs — even occasionally — means more happy fans in more places. It also means more underdog upsets, means probably means more happy fans. I know sports fans like to think of their preferred form of entertainment as being different, somehow. But it isn’t.

      What will be acceptable is a system in which randomness governs pretty much everything. It’s the logical endpoint.

      This is a pretty weak attempt at a reduction to the absurd. In fact, what will be acceptable is a system in which the balance between randomness and talent is acceptable to the greatest number of people (or the people with the greatest amount of power). The number of dollars spent at roulette tables notwithstanding, at some point a random result:talent result threshold must exist where fans will be turned off and stop following hockey.

      What is that threshold? I’ve no idea. But I doubt we are there yet. I haven’t seen many editorials longing for the days of Olde when multi-year dynasties were the rule and talent always wins over underdogs. Well, except in Edmonton where our scrappy brand of underdogs are going to establish a multi-year dynasty.

      • Tyler Dellow
        April 5, 2012 at

        I’d call that a feature, not a bug. It allows the fans and owners — at least in principle — to require more accountability from the GMs, who no longer have the twin excuses of (a) not having enough dough to get good players and (b) there not being enough good players available.

        I don’t think that the CBA has resulted in there being more good players available.

        If I’m the NHL, this is yet another feature rather than a bug. And not because they are a cartel, but because they are in the entertainment business. More teams able to make playoffs — even occasionally — means more happy fans in more places.

        If I’m the Edmonton Oilers, the best system is the one that puts me in the playoffs every year. The only reason teams like Toronto, Edmonton and New York, for example, would want to give up their competitive advantages (financial power) is if they can make more money doing it some other way. It’s not about more happy fans in more places. It’s about increasing their individual bottom lines.

        • sacamano
          April 6, 2012 at

          “I don’t think that the CBA has resulted in there being more good players available.”

          But it did allow more good players to be available to each team which is obviously what I meant. As you note, the talent is spread throughout the league, rather than being concentrated in a few spots.

          “If I’m the Edmonton Oilers, the best system is the one that puts me in the playoffs every year. “

          Right, when considered by individual teams. But the NHL is a league. That’s why I started my sentence with, “If I were the NHL . . . ” rather than, “If I were the Edmonton Oilers . . . “.

          Plus, a stronger league makes individual teams more money, which is, of course, exactly why you have been so consistently and correctly mystified at why the league (and owners of rich teams) continue to prop up teams in unprofitable markets.

    4. Hambone
      April 4, 2012 at

      You would think that with more parity and a smaller window for potential playoff success, there would be less patience among fans for the type of “rebuild” the Oilers are going through, because there is less probability that such a strategy would result in sustained success due to the cap.

      • Passive Voice
        April 4, 2012 at

        Luckily, Edmonton has sophisticated fans who understand the need for a half-decade tear-down.

    5. April 5, 2012 at

      Montreal is a -3 in real goal differential now.

      The incredible combination of bad luck and front office incompetence that was a solid bet for the playoffs into a lottery team has been a source of much black humour among those that track these things.

      Karmic balance for the 2009-10 playoff run with a team that actually deserved to be in the basement you could say although the connection between what the stats say Montreal should accomplish and what they’ve done has been hilariously out of sync ever since they won the East with a negative possession stats in 2007-08.

      • April 5, 2012 at

        Continuing on the vein of good goal differential team finishing this low and in celebration of clinching 28th worst tonight I went looking for comparables to Montreal in non-shootout non-empty net goal differential. Unfortunately I don’t have empty net data past 98.

        Closest I can find so far is 96-97 Islanders with 5th worst at -10 but no empty net data. 98-99 Washington true differential was -16.

        92-93 Rangers are pretty similar with finishing 6th worst sporting a -4. I do believe they won a cup the following season.

        89-90 Flyers -7, 4th worst of 21.

        Nothing else pre-expansion.

        Assuming nothing particularly big happens on the final game of the year I am ready to crown the 2012-13 Montreal Canadiens as the best team to finish this low in the Modern NHL. Certain that they are the best since the introduction of the shootout

    6. Wan Ihite
      April 5, 2012 at

      If you remove the financial edge that separates teams, then you increase the share of luck, yes. But the question remains whether there are significant NON-FINANCIAL things that separate teams. Keep in mind here that while any NHL GM would do a better job than me (Montreal’s aside), we’re talking about a difference that would be noticeable between GM’s all of whom have professional scouts, the same access to game tapes, access to the same small pool of qualified coaches, a lot of the same technologies for breaking down performance, etc… So long as all 30 invest in these things and try hard, how much gap between them still remains?

      To the extent it’s small, luck becomes king.

    7. Tom Benjamin
      April 5, 2012 at

      When this CBA came in, people were thrilled by the advent of parity; at the time, I kind of understood that to mean that all teams would have an equal chance to be good.

      This is basically what we had under the old CBA even though that was a very tough case to make. The salary structure was very irrational with the player’s age a bigger factor in determining his salary than his ability. That benefited small market teams who could become outstanding with a relatively small payroll simply by letting veterans go at age 30 (or trading them) and ignoring the free agent market.

      While the floor has adversely affected rebuilding teams, the bigger problem is the changed salary structure. A rebuilding team quickly gets expensive as soon as good players come off their entry level contract. They get expensive long before the team gets good. Under the old CBA rebuilding teams got good long before they became expensive.

      What I didn’t realize was that it seems to have meant that virtually anyone could make the playoffs because talent is so equally spread between most teams that randomness will have a much more significant role in determining who makes the playoffs versus who has a horrible year.

      Indeed. I think we are seeing teams being divided into three groups – Above average, Average and Below average. The elite teams and the true bottom feeders are being driven out. Within each group it is very possible to see a team drop a category due to bad luck or jump a category because of good breaks. (See Montreal, a team that, in my opinion, has been average for the past three or four years. One year, they looked like a contender. This year… Or Ottawa, another average team. Last year everything went wrong. A fake rebuild, better luck and
      this year they are back to where they always belonged.)

      I like to think it is possible to be above average indefinitely. When the hockey gods decide to rain on an above average team, they slip to the middle of the pack. When everything goes right, they win a President’s Trophy. Kevin Lowe, of course, provides evidence that it is possible to be below average indefinitely, too. But hey, if the hockey gods drop everything else, the Oilers might look almost decent next year.

    8. Triumph
      April 5, 2012 at

      Of course that’s why teams have financial problems (although New Jersey has been a cap team – their finances have nothing to do with the cap). The floor is $10M higher than the cap was in 2005-06 – does anyone really think that the worst markets have had their revenues pick up by that much?

      The clear solution – leaving aside Euro pipe dreams like promotion/relegation and abolishing the NHL entry draft – is the lowering of the salary cap floor, and the introduction of a heavily injurious luxury tax above the current cap threshold, as well as an end to the extreme front-loading of contracts. There’s very little redistribution of wealth in this league, but when you have a system where Toronto’s finances seriously affect your own spending, they should also add to your bottom line. As the distribution of revenues grows more inequitable, we’ll see more teams wanting this kind of system – I don’t know if it gets done in this CBA though.

    9. April 5, 2012 at

      One other aspect of randomness determining results that you have failed to mention is the role of officiating. The biggest “random” factor in the game is how it’s called on the ice by the officials. Now, we all know Bettman was a disciple of David Stern, who has proven to be a big fan of directing officials to push series to seven games, and call in favour of major television markets in the playoffs. And, going no further than the emails you published from Colin Campbell to Walkom, and the fact that he is still associated with the NHL in an executive capacity, we can accept that Bettman has no problem with a similar strategy. God knows we all saw the refs bury their whistles in the Stanley Cup Final after the Aaron Rome hit. Does anyone think the financial stability of the NHL was going to be helped more by Vancouver winning than a major American market like Boston? Just consider which teams raised the Cup since the lockout (2 expansion franchises, and 4 major US markets) and where they were located. OK, Pittsburgh isn’t a “major” market, but they did have the face of the game playing for them, and were just a few years prior on the verge of bankruptcy. So, if you want to control the results, and the results are based on “randomness”, and you can control the biggest “random” factor in the game (outside of injury), you’re laughing all the way to the bank.

      • Triumph
        April 5, 2012 at

        Spare me the conspiracy stuff. Canadian teams, Canucks aside, have been hot garbage since the lockout. Furthermore, refs have way less of an influence on the outcome of a hockey game than on a basketball game. Refs can’t really ‘rig’ a hockey game in the way that they can a basketball game.

        If the refs wanted to rig Game 7 of Edmonton-Carolina, they would’ve given the ‘Canes a penalty shot when Staios closed his hand on the puck in the crease.

    Leave a Reply

    Your email address will not be published. Required fields are marked *