Saturday, April 12, 2008

Oilers Handing Out Money

Yesterday, the Edmonton Oilers announced two signings. Tom Gilbert was signed to a 6 year contract at $4 million per year and Robert Nilsson was signed to a three year contract at $1.83 million per year.

Gilbert had a solid rookie season scoring 33 points from defence, but his contract is ridiculous. The Oilers are paying him to develop into a frontline NHL defenceman (he will have to be a potential all star to be underpaid on this deal). The problem is Gilbert is already 25 and probably won't make a significant jump in his output (players who make such jumps are usually a few years younger than he is) and he only has a one year track record of NHL play. Gilbert was the second highest scoring rookie defenceman this season (behind Tobias Enstrom of the Atlanta Thrashers but it is most reasonable to imagine that over his career he will be significantly outplayed by other younger defencemen who were 2007/08 rookies (including several of Erik Johnson, Jack Johnson, Kris Letang, Alex Edler, Matt Niskanen and maybe some others). This is a contract that will look bad in a few years. I think it already looks bad now. Gilbert is the fourth highest paid player on the Oilers going into next year. I don't think it's reasonable to expect he will be one of the four best. This is not much more money than the Oilers could not find to resign Ryan Smyth. Can the Oilers at least come up with a consistent strategy from year to year?

Robert Nilsson is the most valuable piece of the Ryan Smyth to the New York Islanders trade. Nilsson was not a rookie this season, but at age 23 is younger than Gilbert. I think he has a better upside. He scored 41 points this season and continued improvement is still quite likely at his age. In two years, when he is as old as Gilbert, expect him to be a far better player than Gilbert is now (or will be then). This is a much smarter signing for the Oilers.

In the salary capped NHL, finding the money to pay your young stars when they emerge as a talented core is a hard thing to do. That hasn't happened for the Oilers yet. They showed signs this year, but a playoff berth is still at least a year away. Paying their young players, like Tom Gilbert, as though they are stars does not help. If they do have young players break out in the future and the Oilers make a big jump in the standings, they won't have the money to pay them because the Tom Gilberts of the team have already been given it.

"Can the Oilers at least come up with a consistent strategy from year to year?"

Significantly, it was announced only a mere two months ago that Daryl Katz was to buy the team from EIG. That changed the strategy, as he has said that the team will consistently be paying out near the cap.
Of course thats not a change in the Oilers startegy as far as I can tell. They spent relatively close to the salary cap this year. Katz had not bought the team when this year's contracts were signed.
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