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The Puck Stops Here

A Maple Leaf Fan’s Thoughts On Revenue Sharing

I chose to write this piece from the point of view of a hypothetical Toronto Maple Leaf fan.  That allows me to fill in a few details that are team specific.  The general argument is the same for any large market team, but a few specifics must be changed to suit the market (for example one might remove the problem of missing the playoffs).

Toronto Maple Leafs tickets are the hottest ticket in town.  It is almost impossible to buy tickets.  As an example, I went to the Toronto Maple Leafs site through Ticketmaster and attempted to buy two tickets to the March 12th game against the Tampa Bay Lightning.  This is a midweek game against a bad team that is a month away.  The best seats available were standing room only for that I get to pay over $76 for the two seats when including the Ticketmaster “convenience charge”.

How do I get tickets where I can actually sit down?  I will have to use a ticket broker to buy “re-sold” tickets.  The cheapest I could find for the mid-week game against Tampa Bay that is a month away is $144 for the two seats.  That would put me in the upper deck in the corner behind one of the goal lines.  To sit a centre ice in the 11th row (the best seats available) would cost me ten times that or $1440.

I am jealous when I hear about other markets where seats are available.  There are seats available and they are cheap.  The Florida Panthers have a “first timer” promotion where anyone with a Florida driver’s license can get two free seats to a Panthers home game.  They also offer two seats, free parking, two pizzas and two cokes for $50 for people who are not getting in free.  There are several other ticket deals available in the South Florida market.

In Atlanta, you can buy marked down ticket plans and half of your purchase price is credited toward a further purchase next season.  If I were to spend $300 on tickets (which would get me to 10 games!) then I would have a $150 credit for next season.

I am jealous of those cities.  People can actually get to NHL hockey games and they can get there cheaply.  The jealousy ends when I realize that the reason they can get there cheaply is I am paying for it.  That is the beauty of the NHL’s revenue sharing program.  The larger market teams like my Toronto Maple Leafs send money to these markets that offer cheap (and giveaway) tickets.  In fact, they are encouraged to do so by the revenue sharing program.  In order for teams to qualify for revenue sharing, there are several targets that they must hit.  One is the number of tickets sold for their games.  This leads to cheap and giveaway tickets.  This can lead to teams buying their own tickets to ensure enough sales to get a welfare cheque from the league.  This is a welfare cheque that I pay for.

The revenue sharing pool comes from four places.  Central league revenue (from TV, sponsorships, merchandising etc.) funds up to 25% of the total (assuming this revenue stream hits certain minimum size).  There is a small addition of leftover escrow monies from the ten biggest revenue teams (a group that certainly includes Toronto).  This pushes the total from 25% up to a maximum of 33%.  The remainder of the funding is split 50/50 between direct funding by the ten top revenue teams and proportional to the margin their revenue is larger than the 11th revenue team.  The Toronto Maple Leafs contribute a large portion of this money.  The other half of the funding comes from the playoffs.  Teams are taxed on playoff ticket sales (50% for the top 10 revenue teams, 40% for the middle 10 and 30% for the bottom ten).  The Maple Leafs are basically exempt from this.  They haven’t made the playoffs since the revenue sharing system came into existence.  Nevertheless, they are one of the largest payers of revenue sharing money in the league. 

The playoff funding is an odd thing.  The financial reward for making the playoffs is reduced.  Is it good to ever reduce incentives to make playoffs?  Further assuming they make playoffs, the Florida Panthers and Phoenix Coyotes are actually paying into the revenue sharing pot as well as drawing from it.  Is that even sensible?

I am well aware that ticket prices won’t go down in my Toronto market if revenue sharing is abolished.  What might go down is the number of games played against teams I do not care about that are relatively recent additions to the NHL.  If these teams fail (and they may fail even with revenue sharing) they won’t be around to play the Leafs.  That leaves more games against the teams I care about. 

I am upset because I am funding ticket price reductions in markets that don’t care enough about hockey to sell tickets.  In Toronto, we love hockey.  We love it to the point that tickets are scarce with a losing team.  Imagine what would happen if the Leafs ever start winning.  In some of the failing markets, tickets are plentiful and almost given away and nobody cares.  Seats still remain empty.  They see the same product that I would see if I went to a Leaf’s game for far cheaper.  Why should I pay so that somebody in Florida gets a cheap game?

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About The Puck Stops Here

imageThe Puck Stops Here was founded during the 2004/05 lockout as a place to rant about hockey. The original site contains over 1000 posts, some of which were also published on FoxSports.com.

Who am I? A diehard hockey fan.

Why am I blogging? I want to.

Why are you reading it? ???

Email: y2kfhl@hotmail.com