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Category: NHL-Business-of-Hockey

About The Falling Canadian Dollar

from Eben Novy-Williams and Gerrit De Vynck of Bloomberg Business,

The NHL has a loonie problem. The Canadian dollar fell to 68¢ last month against the U.S. dollar, a 13-year low, and analysts think it could drop an additional 13 percent in 2016. The weakened state of the currency may cost the NHL hundreds of millions of dollars in lost revenue.

The NHL does all its business in U.S. dollars, and all players are paid in greenbacks. The league also computes its total annual revenue in U.S. currency. Revenue for the league’s seven Canadian teams comes in the form of Canadian dollars, which is then converted into U.S. dollars. This season it’s going to take many more of the weak loonies to help the league reach its revenue target, estimated to be $4 billion. Chances are growing slim that the league will hit its mark.

That has implications for more than team owners. The teams and players split revenue 50-50. Money is withheld from each NHL player’s paycheck and kept in escrow. If league revenue at the end of the season doesn’t meet its target, money is taken from escrow to ensure an even split with the owners.

For the 2011-12 season, the players’ haircut was 0.5 percent of their annual salaries. At the start of this season, the players’ escrow accounts withheld 16 percent of salaries: That number just rose to 18 percent, as the Canadian dollar declined. Representatives are warning the players not to expect much back. “No one is happy about it,” says NHL players agent Allain Roy.

continued

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The Declining Canadian Loonie

from Rick Westhead of TSN,

Escrow is already a dirty word for those who earn a living playing in the National Hockey League. 

It’s about to get dirtier.

Word is spreading among NHL player agents and team executives that escrow – the amount of money taken off a player’s paycheque and held back in case NHL revenues are lower than expected — will likely be increased within the next few weeks.

Stew Gavin, a former NHL player who now acts as a Toronto-based financial adviser for professional athletes, said he wouldn’t be surprised if escrow is readjusted to 20 per cent from its current 16 per cent.

“Companies in Western Canada are laying off and industries are slowing down. People are not buying,” Gavin said. “There are some tough headwinds. Who knows if companies will keep supporting teams by renting luxury suites and buying tickets? There have been some steep declines in a relatively short time. Blame oil prices. There’s an oversupply and the price of oil hasn’t hit bottom.”

continued

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The Revenue Growth Of The NHL

from Ian Thomas of SportsBusiness Journal at Buffalo Business First,

For the last few years, the National Hockey League has built what Commissioner Gary Bettman says is a solid foundation. From a 10-year collective-bargaining agreement signed with the players union in 2013 (the league’s longest to date), to the broadcast contracts with NBC and Rogers (in Canada), to rule changes to improve the quality of the game, the league has put all of those pieces into place.

Now it’s paying off. Not only is the league poised to top $4 billion in revenue in the season ahead, it is forecasting to top $4.5 billion by the 2017-18 season.

“We’re now able to put building blocks on top of that foundation,” Bettman said. “And the good news is, those building blocks are ever ascending in height, and are strong and stable — perhaps the strongest they’ve ever been.”

The league is benefiting from a sharp rise in national revenue, which includes leaguewide sponsorships, media rights deals and licensing. In 2005-06, national revenue accounted for about 7 percent of total league revenue, but now makes up nearly 20 percent of that figure. In addition, national revenue has grown about 20 percent a year, while the local team revenue that makes up the rest of the league’s total revenue figure has grown about 4 percent a year.

continued

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There Is Only One NHL

from CNNMoney,

Due to a demand by the National Hockey League, the Company has changed its symbol on the Canadian Securities Exchange ("CSE") from "NHL" to "EAT". In the U.S. the company continues to trade under the symbol "SPLIF" on the OTCQB.

Nutritional High CEO David Posner commented: "We're honored to follow in the footsteps of the Nordiques, who were also asked to change their name upon their move from Canada to Colorado. The Avalanche won the Stanley Cup that year, so we figured why fight a winning formula? While we don't believe anyone would confuse our respective products, we decided to make the symbol change to avoid possible legal costs, despite being on solid legal ground."

if interested in the company, read on...

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Sponsorship In Full Force During The Playoffs

from Tony Lefton of SportsBusiness Daily,

NHL sponsors are readying activation as the Stanley Cup Playoffs open tonight in Montreal, Nashville, Vancouver and DC.

As the league continues its effort to make the playoffs an “April/May/June Madness” similar to the NCAA hoops festivities in March, Samsung is sponsoring a playoff bracket challenge again, and the NHL hopes to double last year’s 530,000 entries.

Fellow sponsor SAP ties in this year with supporting analytics. “As we look to develop more fans, a bracket contest is something casual fans will weigh in on,” said NHL Exec VP & CMO Brian Jennings.

Honda has its second TV spot with Hockey HOF Curator and keeper of the Stanley Cup custodian Phil Pritchard, which will support its Pilot SUV. The white-gloved “Cup Keeper” has previously appeared in ads for MasterCard and Discover. On the beverage side of the house, Pepsi’s AMP energy drink is backing “No Bull Moments” playoff video vignettes on NHL Network and NHL.com.

continued

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Videos- The NHL Supposedly Has The Most Sophisticated Fan Base

And we get...

 

 

I'd rather listen to five minutes of this...

Continue Reading »

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Would You Be Happy With No Salary Cap Increase For Next Season?

from Larry Brooks of the New York Post,

NHL general managers are no longer operating under the assumption that the cap is going to increase next season.

The projected decline in the Canadian dollar — up at least temporarily a tick to 88 cents on the U.S. dollar as of Friday — has had an impact on discussions regarding extensions in at least three cases, front office sources have told The Post.

Further anecdotal evidence suggests these are not isolated instances.

Given the fixation of escrow under which the players currently are having 14 percent of their pay withheld, it certainly is a realistic possibility the NHLPA will not exercise a 5-percent escalator for 2015-16.

That might mean a stagnant cap in the $69 million range, which fall some $5 million to $6 million shy of previous optimistic projections.

continued and other topics including player talk on Ryan Clowe, Cory Schneider, Slava Voynov but it doesn't stop there...

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Afternoon Line- Rick Westhead On The “Jersey Ads”

If you missed the news earlier, start here and I agree with Westhead and I did not even include the "jersey ads" in the main story since I felt Collins was talking in general terms.

Yet it has become a hot topic of the day elsewhere.

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NHL COO John Collins Talks Business

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.”

more

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  Tags: john+collins

Digital Dasherboards

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 $$$).

continued

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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.

From breaking news to in-depth stories around the league, KK Hockey is updated with fresh stories all day long and will bring you the latest news as quickly as possible.

Email Paul anytime at pk@kuklaskorner.com

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