On November 26, it was announced that the NHL and Rogers Communications had reached a blockbuster 12 year $5.2 billion deal that makes Rogers the sole distributer of NHL games in Canada. This deal doesn’t only affect Canada, however, as increased revenue from the deal has allowed a raise in the salary cap this upcoming season, and an even bigger jump in the years after. The current salary cap is $64.3 million, and next year’s jump will see it go up to $71 million, nearly a 12% increase. The salary floor will also be raised from $44 million to around $52 or $53 million.
What does this mean for teams right now? An extra $7 million in cap space can go a long way in re-signing star power players, or adding depth to their team in free agency. Knowing that the cap will go up next year allows more competitive teams to make moves at the deadline to improve their team for the playoffs, while also giving them some added breathing room and flexibility with their budgets.
What does this mean for teams in the following years? Teams that are at the cap limit will have a $7 million cushion to fall on next year, allowing them to keep their core together longer while avoiding penalties for violating the salary cap. The Chicago Blackhawks are a perfect example of this. Right now, the Blackhawks only have $482,489 in cap space, which is less money than the minimum salary for a player in the NHL, which is $500,000. In two years, the Blackhawks will have to re-sign their two best players in Patrick Kane and captain Jonathan Toews. Both players are unrestricted free agents, meaning that any team can sign them once they hit the open market without having to forfeit draft picks to Chicago. Now, it doesn’t seem like that is a concern, as the Blackhawks will have ample cap space to re-sign the two-time Stanley Cup champs. Another team that is helped dramatically by the cap increase is the New York Rangers, who have 14 pending free agents next year, including Michael Del Zotto, Dan Girardi, and team captain Ryan Callahan. All-star net minder Henrik Lundqvist was also a pending free agent before signing a 7-year $59.9 million deal. Right now, the Rangers have $1 million in cap space, but because of the jump next year, GM Glen Sather will have roughly $32 million to re-sign his core as well as young talent such as Chris Kreider.
What does this mean for the players? This year, the highest payed player in the league is Shea Weber, who is making $14 million, though he only carries a cap hit of $7.9 million. In the years to come, expect to see more players signing deals with annual salaries and cap hits that break double-digits in millions of dollars. Alex Ovechkin is currently the leader in total salary, as his 13 year deal signed in 2008 is worth $124 million. Within the next five years, total salaries of that magnitude will be more commonplace in the NHL, and the years attached to those contracts will begin to decrease. Going back to Patrick Kane and Jonathan Toews, we could very well see them become the first two players in league history to command a cap hit of over $10 million annually.