Kukla's Korner Hockey
from Ian Thomas of SportsBusiness Daily,
The NHL has ridden a wave of momentum in recent years, taking revenue from $2.2B in '06 to approximately $4B now. In a one-on-one interview during Day 1 of the ’14 NeuLion Sports Media & Technology Conference, NHL COO John Collins outlined some of the successes that brought the league to this point, and talked about what will continue to drive the league forward....
WORLD CUP: The league is still moving forward with its plan to host a World Cup of Hockey. Collins said the current plan is to feature eight national teams at a single destination in a 16- or 17-game tournament that will span a couple of weeks with no qualifying games. Previous versions of the tournament, held in '96 and '04, were played in a variety of venues around the world. The tournament would likely be held in September and feature a best two-out-of-three final, Collins said. The league, along with the NHLPA, would own the tournament and could sell the rights to a broadcasting partner.
CONFLICT WITH OLYMPICS: Commenting on the revenue that might be realized from a World Cup of Hockey, Collins said the key difference between that event and the Olympics is that the World Cup would be “our IP, and the Olympics isn’t.” Collins said the league has not always received “full value” from having its players participate in the Olympics, as having the NHL “go dark” during the Games is a problem. Collins noted that the timing of the Olympics also presents a problem for its rights holders. Games played in some time zones, such as during the '10 Vancouver Games, can be shown in primetime, However, at other Olympics, like the '18 Pyeongchang Games, “a game being shown at 4 a.m. isn’t good.”
from Sports Illustrared wire service,
The NHL is testing virtual advertising technology on dasherboards, Sports Business Daily reports.
Seventeen teams already use virtual advertising above the dasherboards in broadcasts, but the league is exploring options to expand the technology to create “dynamic dasherboards.”
The new digital billboard replacement, which is being tested by European company Supponor, would allow for broadcasters to sell dasherboard inventory even when a team is playing at an away venue.
The in-venue signage would also generate more revenue, though problems arise when deciding how to split it (the $$$).
from Pat Hickey of the Montreal Gazette,
The Canadian dollar has been steadily losing value vis-à-vis its U.S. counterpart. It dropped below 90 cents this week and economists see a further decline in the future. A CIBC report said the loonie could fall to 82 cents early next year.
What does this mean for the NHL?
The league has enjoyed a dramatic rise in revenues over the past decade despite two potentially devastating lockouts. We would like to give NHL commissioner Gary Bettman credit for growing the business, but the driving force behind the increase has been a healthy Canadian dollar. Canada bounced back from the recession faster than the U.S. and that was the result of a booming resource sector.
But oil prices have reached the stage where it is too expensive to extract the sludge from the Alberta oilsands. The dollar is dropping and every decline in the loonie’s value will have a largely adverse effect on the NHL.
We start by looking at those overall revenues. Upwards of one-third of the money that is used to measure hockey-related revenue in the NHL is generated by the seven Canadian franchises. If the dollar drops in value, so does the overall revenue.
Teams are expecting to have a little more cap money next season because the full value of the Rogers Canadian TV deal kicks in, but that deal will be worth a little less next year and the value could continue to decline.
from Scott Shoshnick of Bloomberg,
The National Hockey League closed a $1.4 billion credit facility, which is more than double the previous amount, according to a person with direct knowledge of the matter.
The person requested anonymity because the league didn’t disclose the lending pool, which was led and structured by Citigroup Inc. (C) and closed yesterday. The facility includes 20 banks and 20 investors, the person said.
NHL spokesman Frank Brown and Citi spokeswoman Natalie Marin declined to comment on the facility.
Among the 11 teams that tapped the facility are the Stanley Cup champion Los Angeles Kings, Chicago Blackhawks and New Jersey Devils, the person said, adding that three so-called parking spots are being reserved for other potential borrowers.
from James Mirtle of the Globe and Mail,
Get ready for a skyrocketing salary cap in the NHL, even before the league’s new Canadian TV deal gets factored in.
According to a report on Monday from Chris Botta of the SportsBusiness Journal, NHL revenues for the 2013-14 season are expected to hit $3.7-billion, which would be a 12-per-cent increase over the league’s last full campaign.
With the new TV revenue added in a year later, meanwhile, that figure will for the first time crack the $4-billion mark in 2014-15.
That’s obviously a good business story for Gary Bettman and Co., but the more pertinent result of much higher hockey-related revenues for fans (and general managers) is the impact it’ll have on the cap.
from Christopher Botta of SportsBusiness Journal,
The NHL is crafting a series of Canadian television deals that could increase its average annual rights fees to more than $350 million, nearly double the current amount, while creating a Sunday night telecast franchise for the league.
The ongoing negotiations involve five Canadian networks: CBC, TSN, Sportsnet, and French-language broadcasters RDS and TVA. Negotiations are focused on 10-year deals, the same length as the $2 billion agreement between the NHL and NBC Sports Group that was reached in 2011. The forthcoming Canadian deals are expected to escalate in value over the length of the contracts, possibly exceeding a total of $400 million by the end of their terms....
According to industry sources, CBC will remain as the league’s major partner and will retain “Hockey Night in Canada,” its iconic franchise since 1953. But the network would see its rights fee go up and some of its current inventory go to other programmers.
CBC (the over-the-air, public Canadian Broadcasting Co.) now pays $121 million a year. In the new deal, CBC is expected to pay about $175 million a year. However, it would lose the rights to the NHL All-Star Game and some playoff broadcasts, sources said.
from John Ourand and Eric Fisher of SportsBusiness Journal,
“For us right now, it’s about managing the conversation and creating the national conversation around hockey so fans can better understand what’s going on around the league,” said John Collins, the NHL’s chief operating officer. “Just because there’s not real revenue today doesn’t mean that we don’t think there will be.”...
The NHL is talking to the company about developing further ways to push national conversation around hockey, which traditionally has been very regional in its fandom. More specifically, the league and corporate partner Coors are working on social media executions for the coming debut of the Coors Light Stadium Series of outdoor games.
“Our partners and sponsors are looking for a social media play that can help drive a conversation around those platforms,” said the NHL’s Collins. “Sometimes they look to us for that and we can provide it. Sometimes they want to provide it and use their own resources to drive a specific program they have.”
much more, I just pointed out some of the NHL talk but the article is about all the major sports...
Senators owner Eugene Melnyk spoke to the media at the opening of the 'Sens Mile' on Ottawa's Elgin Street today.
There were a few questions about the team on the ice, and how far they might be able to go in the reorganized Atlantic division after losing Daniel Alfredsson and adding Bobby Ryan in the off-season, but there were even more questions about the owner's ability or willingness to pony up the dough to make the team competitive.
The Ottawa Citizen's Senators Extra has the full audio of Melnyk here (autoplay warning)
Among the stranger comments by Mr. Melnyk was when he was asked about the club's internal budget, and said that he'd "just found out yesterday" that they'd already exceeded it. This despite his admission that it was a statistical certainty that a team must be among the top half of the league to have any kind of success in a season (the Sens currently sit 26th in league spending per CapGeek.com a few spots behind the Phoenix Coyotes).
from Steve Keating of Reuters,
After last year's lockout-shortened campaign the NHL is back with a full action-packed 82-game schedule designed to put the league in the sporting spotlight and keep it there with a daring lineup of glossy events.
"One of the most important things to come out of the negotiations was 10 years of labor peace and that is allowing us to begin to execute the plans we have for growing the game and growing revenues," John Collins, the NHL's chief operating officer, told Reuters.
"We've added a lot of blue chip partners on the broadcast and the sponsorship side, who said they like where the game is and like where it's going and want to spend money promoting and activating around hockey.
"They need events like the Winter Classic and Stadium Series to do that."
From the great Olympic stage to an unconventional outdoor game in sunny Los Angeles, the NHL appears determined to leave no marketing stone unturned in an effort to rebuild its brand and repair the damage done by a bitter labor dispute.
George’s recent post has turned me on to Emory University’s ranking of what they’ve called ‘social media equity’ among NHL fan-bases (Detroit was first – congratulations) and the broader work they’ve done on sports marketing statistics.
My Senators have not done well in these rankings.
Ottawa ranked 26th in the social media study, and was declared to be the ‘worst hockey city in Canada’ by the authors. This conclusion follows on the heels of an earlier study released by the same authors last week, which looked at ‘Fan Equity’. This study ranked Ottawa 28th out of 29 teams (Jets were excluded, due to their move) and had the following to say:
“This is just embarrassing for a Canadian team. Let us respond to the Ottawa fans right now. We don’t care that you sell out – read the description of the method.”
I’m not a statistician, but I do love a good argument – so I’m going to take them up on their offer and try to defend the Senators’ honor. I’m going to try to do this by comparing Ottawa with the team they’ve ranked
7th 14th (earlier mistake corrected) in ‘Fan Equity’, the Detroit Red Wings.
About Kukla's Korner Hockey
Paul Kukla founded Kukla’s Korner in 2005 and the site has since become the must-read site on the ‘net for all the latest happenings around the NHL.
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