Nov 29, 2012

Are NHL Players Overpaid?


league revenue nfl nba nhl mlb


With another NHL Lockout underway, most hockey fans have become tired of the stale debates between the millionaires and the billionaires.  Who’s to blame? At this point, the majority of us don’t care who’s right or wrong, we just want the season to start.  The bigger question remains, can NHL revenues even sustain the current player contracts without a new collective bargaining agreement (CBA)?

Going back to the early 90’s, it is incredible what less than $9 million bought you back then when only the top players were paid the highest salaries.  Today we have good but not great players making more money than today’s Superstars.  Imagine if back then Tony Granato was paid more than Wayne Gretzky or if Geoff Courtnall was paid more than Brett Hull. Laughable and unthinkable don’t you think? Yet this is exactly what is happening in the current NHL.

1990–91 Season – Top 5 Player Salaries:

    Wayne Gretzky (Los Angeles Kings) $3 million
    Mario Lemieux (Pittsburgh Penguins) $2.18 million
    Steve Yzerman (Detroit Red Wings) $1.3 million
    Ray Bourque (Boston Bruins) $1.194 million
    Brett Hull (St. Louis Blues) $1.116 million

2012–13 Season – Top 5 Player Salaries:

    Shea Weber (Nashville Predators) $14 million
    Tyler Myers (Buffalo Sabres) $12 million
    Zach Parise (Minnesota Wild) $12 million
    Brad Richards (New York Rangers) $12 million
    Ryan Suter (Minnesota Wild) $12 million

There’s a big difference between Superstars and very good or average players which is not always measured just by their performance on the ice. Player marketability and how much value they bring to the team and the league is an important factor when negotiating contracts.  The Los Angeles Lakers don’t pay Kobe Bryant ~$28 million a year just to shoot hoops, it’s a business decision. In fact, some financial experts believe that Kobe is actually underpaid for the overall revenue he generates to the team and the NBA overall. The same can’t be said for the majority of the NHL’s current top paid players.

tv contracts nfl mlb nba nhl

The National Hockey League (NHL) has always lacked in terms of player marketability and its limited exposure in the U.S. on the national level has produced lackluster TV contracts compared to the National Football League (NFL), National Basketball Association (NBA) and Major League Baseball (MLB). (Graph B)

Has the average person even heard of Ryan Suter, Zach Parise, Tyler Myers, Christian Ehrhoff or Brad Richards? Yet these are some of the NHL’s top paid players.  How can signing players to contracts that they can’t possibly meet or exceed performance wise on and off the ice be profitable long term? 

market value nhl teams

If NHL owners thought they were getting a great return on their investments then there certainly would NOT be a lockout right now.  Would you really want to pay $26 million this year just for Christian Ehrhoff/Tyler Myers/Ville Leino? How many people in the world can’t wait to put on their Ehrhoff jerseys and turn on the TV to a Buffalo Sabres game when the lockout is finished? Outside of Buffalo, probably not very many, yet, this is what the NHL has become, a regional sport trying to be national. Hence, it’s not surprising to see that the average market value of an NHL team is only $282 million. (Graph C)

The only players who should be paid the highest contracts are the Top Superstars (Crosby, Stamkos, Malkin, Ovechkin), who are most likely underpaid thanks to the now expired collective bargaining agreement (CBA).  Even when their performance starts to decline as in Alexander Ovechkin’s case, they can still provide revenue in terms of TV ratings and merchandise sales.  Evgeni Malkin’s contract at $9 million a year looks like a bargain right now considering he is the current MVP of the NHL.

average player salary

What most people find surprising is that the average NHL player salary is higher than that of the NFL even though the NFL has the highest league revenue of any sports league. How can that be? The NHL has 23 players per team and the NFL has 53 players per team so naturally there are more players in the league that have to share the revenue pool. Meanwhile, the NBA has the fewest number of players per team which is why it also has the highest average player salary.

A better comparison to the NHL in terms of roster size is MLB, (23 vs. 25).  Even though MLB had revenues of $7.7 Billion in 2012 vs. $3.4 Billion for the NHL, the average player salary was only $3.4 million a year for MLB compared to $2.45 million for the NHL.  You don’t have to be a stats professor to realize that NHL players are paid a higher percentage of revenue compared to players in the NBA, NFL and MLB.

Revenue sharing is the biggest issue in the current NHL lockout, with players receiving 57% of hockey-related revenue while 18 out of 30 NHL teams supposedly lost money. It's no wonder the owners want to negotiate a new collective bargaining agreement. In the recent NBA and NFL lockouts, players in both leagues agreed to approximately 50/50 revenue sharing plans. So why should the NHL be any different?

nhl ticket prices


Since NHL ticket revenues account for around 50% of overall revenue you would think that the owners and players would try to do everything possible to end the lockout and not alienate or upset their loyal fans. If NHL fans really wanted to teach the players, owners and Commissioner Bettman a financial lesson, they could just stop attending future games which would make a significant impact on the NHL’s economic bottom line.

But NHL fans are more “talk” than action as seen by the attendance figures following the previous lockouts in which the average attendance actually increased. Therefore the league has no qualms in continuing this lockout because they know fans will be back whenever games start again with their wallets open.

At this point, the only true losers in this lockout are the average folks who work in NHL arenas, the referees and small businesses that rely on extra revenue from NHL games.


Sep 17, 2012

NFL Strength of Schedule: A Deeper Analysis

strength of schedule

The NFL Strength of Schedule (SOS) is always a popular topic before each NFL season begins but its accuracy and usefulness is sub-par at best. The basic formula takes the win-loss records of teams from the previous season then adds them up to give you a list of the toughest to the easiest schedules by winning %.  So what’s the problem with this method?
Let’s go straight to some analysis:


2011 St. Louis Rams Schedule (26th toughest) 122 Wins 134 Losses (.477 %)

Sept. 11 vs. Philadelphia Eagles 1 p.m. (10-6)
Sept. 19 at New York Giants 8:30 p.m. (10-6)
Sept. 25 vs. Baltimore Ravens 4:05 p.m. (12-4)
Oct. 2 vs. Washington Redskins 1 p.m. (6-10)
Bye Week
Oct. 16 at Green Bay Packers 1 p.m. (10-6)
Oct. 23 at Dallas Cowboys 4:15 p.m. (6-10)
Oct. 30 vs. New Orleans Saints 1 p.m. (11-5)
Nov. 6 at Arizona Cardinals 4:15 p.m. (5-11)
Nov. 13 at Cleveland Browns 1 p.m. (5-11)
Nov. 20 vs. Seattle Seahawks 4:05 p.m. (7-9)
Nov. 27 vs. Arizona Cardinals 1 p.m. (5-11)
Dec. at San Francisco 49ers 4:15 pm (6-10)
Dec. at Seattle Seahawks 8:30 p.m. (7-9)
Dec. 18 vs. Cincinnati Bengals 1 p.m. (4-12)
Dec. 24 at Pittsburgh Steelers 1 p.m. (12-4)
Jan. 1 vs. San Francisco 49ers 1 p.m. (6-10)


The 2011 Rams were expected by many to win the NFC west division, with a supposedly easy schedule and by playing well in the meaningless NFL pre-season (4-0). Unfortunately they finished with 2 wins and 14 losses, tied for last overall in the NFL.

If you took a closer look at the actual schedule you would have quickly changed your mind about the accuracy of SOS rankings and that’s before the San Francisco 49ers turned into a Super Bowl contender. If that’s one of the easiest SOS’s, what does one of the toughest ones look like you might say?   Well…..


2012 St. Louis Rams Schedule (4th toughest) 134 Wins 122 Losses (.523 %)

Sept. 09 at Detroit Lions 1:00 pm (10-6)
Sept. 16 vs. Washington Redskins 4:05 pm (5-11)
Sept. 23 at Chicago Bears 1:00 pm (8-8)
Sept. 30 vs. Seattle Seahawks 1:00 pm (7-9)
Oct. 04 vs. Arizona Cardinals 8:20 pm (8-8)
Oct. 14 at Miami Dolphins 1:00 pm (6-10)
Oct. 21 vs. Green Bay Packers 1:00 p.m. (15-1)
Oct. 28 vs. New England Patriots 1:00 p.m. (13-3)
Bye Week
Nov. 11 at San Francisco 49ers 4:25 p.m. (13-3)
Nov. 18 vs. New York Jets 1:00 p.m. (8-8)
Nov. 25 at Arizona Cardinals 4:25 p.m. (8-8)
Dec. 02 vs. San Francisco 49ers 1:00 p.m. (13-3)
Dec. 09 at Buffalo Bills 1:00 p.m. (6-10)
Dec. 16 vs. Minnesota Vikings 1:00 p.m. (3-13)
Dec. 23 at Tampa Bay Buccaneers 1:00 p.m. (4-12)
Dec. 30 at Seattle Seahawks 4:25 p.m. (7-9)


Coincidentally and ironically the 2011 and 2012 St. Louis Rams Strength of Schedules are complete opposites of each other in terms of opponent’s wins and losses. But are they really that much different? No, not at all. Even though no one can predict which teams will be good or bad in the future, but you could almost say the 2012 schedule is easier than the 2011 one based on closer observation.

The 2011 St. Louis Rams SOS was calculated as easy because of the previous weakness of the NFC West division which skewed the numbers. The 49ers improving from (6-10) in 2010 to (13-3) in 2011 completely changed that and added 14 wins to the SOS since you have to play each team in the division twice. That alone is already more than the whole difference in (wins-losses) between the 2011 and 2012 Strength of Schedules.

St. Louis Rams Non-Division SOS:

2011 86 wins 74 losses (.538 %)
2012 78 wins 82 losses (.488 %)

So which schedule is actually harder? It’s impossible to know precisely until the season is complete, but NFL Strength of Schedule rankings have produced very inconsistent results in predicting which teams will have tough or easy schedules. You can compare the initial SOS rankings to the final SOS rankings below and see how accurate their predictions were:

Before Season:  2011 St. Louis Rams SOS (26th toughest) 122 Wins 134 Losses (.477 %)
After Season:     2011 St. Louis Rams SOS (1st toughest) 151 Wins 105 Losses (.590 %)

Huge difference don’t you think?

Before Season:  2012 St. Louis Rams SOS (4th toughest) 134 Wins 122 Losses (.523 %)
After Season:     2012 St. Louis Rams SOS (??????????)  ???  Wins ??? Losses (???? %)

How will the 2012 SOS finish for the Rams? No one can predict that with any certainty so it’s best to go thru every schedule that interests you thoroughly and try to look for any outlier teams that may skew the SOS rankings.  A great example of this is the 2012 Buffalo Bills schedule which the majority of people assume is really easy and has many Bills fans and experts anticipating a great season.

2012 Buffalo Bills SOS (29th toughest) 121 Wins 135 Losses (.473 %)

A very quick look at the Bills schedule shows three teams that are influencing these rankings too much. The Browns (4-12), Colts (2-14) and Rams (2-14).  Just taking these three games out of the SOS formula results in a SOS of 113 Wins 95 Losses (.543 %).

The Bills 2012 SOS may not finish as the toughest overall like the 2011 Rams did but it is very unlikely it will finish as one of the easiest as predicted by the NFL strength of schedule.

Even though it may be a little more work and rather tedious going over each NFL schedule in such detail, it will give you a much better idea in determining who really has a tough or easy schedule and what factors influence strength of schedule rankings the most. 


Jul 10, 2012

Are Russian NHL Players Chronic Underachievers?


russian underachievers


Ovechkin, Fedorov, Mogilny, Kovalchuk, Yashin, Bure, Malkin, Datsyuk, Radulov -- names familiar even to the most casual hockey fans, some more successful than others, but as we look at the statistics the number of Russians in the NHL is dwindling.(a)  By now we’ve all heard the stereotypes, lazy, selfish, lacking heart, egocentric, unmotivated after receiving big contracts and more concerned with finding the next Kournikova than winning NHL games. But is this reputation justified or is it just North American media bias? Even though Evgeni Malkin had a great season winning the Hart Trophy as MVP of the league, the 2011-12 NHL season will more likely be remembered for the all too typical shortcomings that most Russian players face in the playoffs.

Malkin’s Penguins disappointingly lost in the 1st round, same for Datsyuk’s Red Wings, Ovechkin well-used to early round failures surprisingly made it to game 7 of the 2nd round but that’s as far as his career has gone so far. More embarrassingly, Coach Hunter thought it would be a benefit to the team if Ovechkin played fewer minutes thus being less of a liability to the team. Ouch. Radulov, coined the best player outside of the NHL, who was supposed to take the Nashville Predators to new heights in the playoffs was suspended for breaking a team curfew during their series with the Phoenix Coyotes which they eventually lost 4 games to 1.

Ilya Kovalchuk, the poster boy for overpaid Russians who’ve never really won any meaningful NHL games finally got a chance at a long playoff run thanks to being part of a winning organization. Unfortunately, the only thing he could muster was an empty net goal in the 2012 Stanley Cup finals when the New Jersey Devils lost to the Los Angeles Kings. 

Another year and another non-Russian lifts the Conn Smyth Trophy as the MVP of the Playoffs, that makes it 22 out of the last 23 years.  Although in my opinion the voting does tend to favor North American players it is still a rare occurrence for a Russian NHL player to put his team on his back and actually lead them to a Stanley Cup Championship.


nhl underachievers









With NHL parity at an all-time high right now, many owners and general managers have changed the way in which they try to build successful teams and Russian hockey players are becoming less and less part of that equation.  So who is taking their place on NHL rosters? Looking at the graph the correlation is obvious as American born players have increased in numbers while during the same time frame Russian born players have almost become extinct.(b)  

So what is the cause of this downward trend in Russian NHL players? Has the talent pool become thinner? Has their negative reputation finally caught up to them? Is the KHL (Kontinental Hockey League) that big of a factor? Are Americans simply developing better players?  Or is the 2004-05 NHL lockout partly to blame? It is impossible to say which variable has had the most influence on this topic as it’s still up to debate and a matter of opinion but the most realistic answer is a combination of all of these over time which has reduced the number of Russian players in the NHL.

Most pundits these days say the KHL is the main culprit however the league was not “founded” until 2008, while the exodus of Russian hockey players started after the 2000-01 NHL Season. One major reason which is often overlooked is the change in development of American hockey players who have become better suited for the current style of the NHL and can offer similar production without all the extra baggage.

Another forgotten reason is the 2004-05 NHL lockout during which many players like Aleksey Morozov went to play in Europe and never came back to the NHL after the lockout ended.  This can clearly be seen in graph (a) where a huge dip occurs during this exact time period.  


russians drafted by the nhl


The 2012 NHL Draft could prove to be a pivotal one as it marks only the third time a Russian (Nail Yakupov) hockey player has been drafted #1 overall.  There was a time when Russians outnumbered Americans at the NHL Draft (1992, 1995) but now they have fallen behind Sweden as Europe’s top country in the number of NHL draftees.  

Once the top players (Malkin, Ovechkin, Kovalchuk, Datsyuk) retire, the future could look really bleak if there’s no top-level talent to replace them.  After the great 2004 NHL Draft there has been very little to get excited about as there have been zero Russian players drafted in the top 5 between 2005-2011. 

Top 5 NHL Draft Picks by Country (2005-2011)

Canada – 23
U.S.A.  – 7
Sweden – 4
Switzerland - 1
Russia - 0

While my views may sound biased, you would be surprised to find that many of my favourite hockey players over the years have been Russian.  Diversity can be good for most sports leagues as a product can quickly become stale for audiences who see the same type of players over and over again. Thus, a complete disappearance of Russians in the NHL would be rather disappointing to many hockey fans. 

Opinions are one thing but statistics are another and at the present time they show little hope in reversing the current NHL trends.  The future of the hockey landscape is up to debate but it will be interesting to see what these graphs will look like in many years.  

Feel free to leave your comments and opinions, if you enjoyed this article and would like to receive future updates from our website please subscribe below.


Jan 19, 2012

Do Line Moves Matter in the NFL?

do line moves matter nfl
2011 NFL Regular Season ATS 136-91

The short answer is YES.  The long one is still to be determined completely.  You will hear all kinds of different answers depending on who you ask without them actually having any factual evidence to back up their claims.  As with any analysis you need a decent sample size to lower variance and not base it on short term "luck".  

For the 2011 NFL Regular season there were 256 games played.  227 of them had a "line move" and 29 had no move at all or the line closed where it started.  As you can see from the graph, ~60% of the time the line move was "right" which for a complete season is a huge percentage.  Will this continue next year? Will it be profitable long-term? None of us can predict the future but to ignore line moves in your decision making is a losing proposition. Now, what is a "line move" anyway and how do we determine it?  Read on......


sharp line moves thegreek
Our Assistant "Junior" Watching Every Line Move


So what is a Line Move? For statistical purposes we keep it simple and consistent.  We base it on the initial/opening line and compare it to the closing line. For example, Houston spread opens at -3 vs Cincinnati then it moves and closes at -4 so the line move is obviously towards Houston. If it moves to -2 let's say then the line move is towards Cincinnati.  Pretty simple and we want to keep it that way.  I will add more complicated examples in the future. 

Late line movement and closing number are very most important factors to consider when making your final decision on a play. Pinnacle Sports and TheGreek are the sharpest sports books in the industry but to keep consistency we'll be using Pinnacle for our databases.




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