Wednesday, July 14, 2010

The Art of Negotiation

Last summer, I wrote a brief post mildly lamenting a small overpay I felt the Oilers made with Jason Strudwick, and instead of re-posting the thing I've chosen to save a bit of time by providing a link here.

I guess I just don't understand this sort of deal. I'm not sure why management gives a raise to this type of player. Was it REALLY necessary to give Strudwick a $25,000 raise to retain his services for next season? I'm not in the Oilers room, or Strudwick's agent, but I have a hard time seeing which other NHL team would have even given him a one-way contract, nevermind a raise to $725,000. He played the 10th most TOI per game among Edmonton defencemen last season. Admittedly, one could make an argument that he was more like 8th in ATOI, since the Johnson/Staois and Whitney/Visnovsky pairings were never on the team at the same time. Even given that, why did the 8th defenceman on the worst team in the league deserve a raise?

Maybe I'm way off in assuming the Oilers could have signed Strudwick for $500,000 as a UFA, or signed Jacques for $550,000 and Deslauriers for $700,000 on one-way deals if they had declined to qualify both players and looked to re-sign them as UFA's. Or used their leverage with Dubnyk to get him signed for $700,000, given that he had no guarantee of a one way contract, Khabibulin and Deslauriers (in this hypothetical) ahead of him on one-way deals, and isn't a stone cold lock to get picked up on waivers this fall. But that represents a real savings of $690,000, and it seems to me that money that could be better used than giving end of the roster players slight overpays that don't seem particularly likely to generate enough goodwill to influence potential future contract negotiations. Better used for things like signing a couple college free agents, hiring more scouts, signing higher quality AHL veterans, or incremental money that could be used to sign a UFA F or D this summer for 2.2 mil instead of 1.5 mil, with an eye towards getting a better quality player that can be flipped for a 2nd at the deadline.

Monday, July 12, 2010

Creating Your Own Problem & The Return Of The Three Headed Monster?

It sounds like the Oilers have come to terms on a two year deal with goaltender Devan Dubnyk, on a one way deal with a cap hit around $800,000 per season. IF the Oilers have decided Dubnyk is their guy, a two year deal is not unreasonable since it can potentially help the Oilers avoid a Group VI free agency with Dubnyk in the event he doesn't play enough games this season (like Schneider in VAN). That said, there are two problems with the deal in my opinion: the yearly amount, and the timing of this deal.

The main problem here is you've created a favorable comparable in arbitration for Deslauriers. If I'm JDD's agent, I don't think I need to work very hard to show that (a) Edmonton thinks Deslauriers is better, since they gave him the majority of starts last year after Khabibulin went down and (b) Deslauriers had a better performance last season than Dubnyk, by whatever measure you want to use (Wins, starts, SV%, SO) in the best environment possible for a direct comparison - the same team. His agent has another decent comparable in the aforementioned Schneider, a goalie with 10 career starts that was given a one way deal at $900,000 for the 2010/11 season.

The other problem I have with this deal is that $0.8 million is more than the Oilers probably should have needed to spend to get Dubnyk under contract for two seasons. Dubnyk and his agent have surely seen the market - there are a lot of goalies available for nothing. Yes, it's possible he could be claimed on waivers this fall if EDM were to send him down, but it's not a certainty. You'd think management would have been able to leverage that uncertainty to get Dubnyk to take a lower wage than $800,000 for the certainty of a one way deal, but perhaps his wage suggests that both parties feel his value around the league is higher than I imagine it to be?

As noted at the fantastic CopperNBlue, it's not impossible that the arbitrator listens to one of the strangers hearings imaginable, in that the Oilers might be arguing for a higher award so they'll be able to walk away, while Deslauriers seeks an award just below the amount required for Edmonton to have walk-away rights. CopperNBlue suggests that somewhere around $1.3 million is the line above which the Oilers could theoretically walk away from Deslauriers, and I, more or less, agree. If anything, I think the magic number might be more like $1.4 million. That would be right around the salary of another potential comparable, Jonas Gustavsson. So, if Deslauriers is awarded a salary above the walk away point, the Oilers might be able to get out of this problem unscathed, but it would seem to be an unintentional "victory" - if the Oilers were worried about this possibility, you'd think they'd have either (a) not qualified Deslauriers, and tried to sign him as a UFA afterwards if they wanted him back, on their own terms or (b) waited to sign Dubnyk until they find out exactly what happens with Deslauriers.

One reason that many suggested as a possible rational for the decision to not qualify Potulny was the unwillingness to get stuck with an arbitration award that was perceived to be worth more than Potulny could negotiate on the open market. I have no idea if that's why the Oilers decided against qualifying Potulny (and perhaps Pouliot), but if that was part of their reasoning, I don't see why they wouldn't have extended that reasoning to include Deslauriers, and chosen not to qualify him either. Presumably the Oilers knew two weeks ago that Dubnyk was in their future plans, there is/was no reason to get stuck with a ~ $1.1 million contract for a goalie you don't really want when you can just sign a comparable replacement on the UFA market for $0.6 million if you develop a need for another goaltender.

So, it wouldn't be terribly shocking, if after Deslauriers' arbitration hearing in a couple of weeks, the Oilers have the following three goalies on one way contracts:

Khabibulin - 3.75 mil
Dubnyk - 0.8 mil
Deslauriers - 1.1 mil