by PuckStopsHere on 05/31/11 at 08:01 PM ET
In 1996, the Winnipeg Jets left town for what they thought were greener pastures in Phoenix. The Phoenix Coyotes are stuck in bankruptcy and NHL control for their third season. It seems improbable that there will be a successful team in Phoenix. Their eventual sale to another market seems almost inevitable.
In the meantime, Winnipeg missed NHL hockey. They missed the Jets. Popular sports bars throughout Winnipeg still retained their Winnipeg Jets memorabilia. Stores still sell Winnipeg Jets memorabilia. This is true in larger cities in Manitoba (such as Brandon) which lie a few hours from Winnipeg itself. The Winnipeg Jets maintained a strong following even though they didn’t exist anymore. The Manitoba Moose were an AHL team that moved into Winnipeg in the Jets absence and they were one of the more popular franchises in the AHL.
Finally, after 15 years we have the official announcement that NHL hockey is returning to Winnipeg. The Atlanta Thrashers are moving there.
The NHL really has no choice but to move the Atlanta Thrashers to Winnipeg. Atlanta ownership gave up on the team years ago but could not sell because of an internal lawsuit. They claim that they have wanted to sell since 2005 and lost over $130 million in the process. Now that they are out from the lawsuits and can sell, they cannot find a local buyer. The Atlanta Spirit ownership group basically handed back the franchise to the NHL and said they were unwilling to cover the losses. Unlike Phoenix where the city of Glendale, Arizona (where the Coyotes play) have put up $25 million last year and a further $25 million next season to cover losses, there was nobody willing to cover Atlanta Thrasher losses. This left the NHL having to support the team financially or sell to a new market.
The only market that was realistic was Winnipeg. It is the only place in North America that has an arena ready and a strong ownership group. The NHL had no other realistic choice, despite Gary Bettman’s claims to the contrary.
As for Atlanta, they are the only market in recent times to lose two different NHL franchises - the Thrashers join the Atlanta Flames who left in 1980. Neither had strong ownership. Neither was a winner. It is unknown how well the Atlanta market would have done if they had a winner, but the NHL is bound to fail if a market must be a winner to be successful. By necessity for each winner in hockey there will have to be a loser as well. Nothing can be done to change that. For the NHL to succeed in 30 markets, they need 30 markets that will survive win or loss.
On a personal note, I was in Atlanta in the spring of 1999 and noticed a twenty something year old man roller blading through Piedmont Park wearing a Team Finland jersey with Ville Peltonen’s name on the back. That was a clear sign that some dedicated hockey fans existed in Atlanta, Georgia.
In the 15 years that NHL hockey has been missing from Winnipeg, three major changes have occurred. The biggest is the increase in value of the Canadian dollar. In 1996 it was as low as 60 cents US and today it is worth more than one American dollar. This is significant for Canadian franchises. They pay salaries in American dollars (as do all NHL teams) and make their revenue in gate receipts in Canadian dollars. When the Canadian dollar rises against the American dollar, Canadian markets do well.
Another major change is the salary cap and revenue sharing under the current CBA. This helps qualified smaller markets to survive. It cannot help a market like Phoenix or Atlanta where hockey never caught on (in part due to inept ownership), but a market like Winnipeg that loves their hockey will be better able to survive hard times, for example downturn in the Canadian dollar, with the current economic structure.
The final major change is the failure of Gary Bettman’s strategy of expanding southward. For the most part, hockey has not caught on the way it was promised with Southern expansion. The NHL does not have a big national TV contract despite their southern expansion. Several of the new generally southern teams are on life support. Atlanta is moving to Winnipeg. Phoenix is likely moving next. Markets like Florida, Columbus, NY Islanders, St Louis and Dallas are in unstable situations. Some might be forced to move. The Southern US markets are large but they are not traditional hockey markets and they have been tough to crack. They are no longer considered the future of the NHL. They are depending on market either a measured success or an outright failure given how much time and money (including a year long lockout) have been invested into their success.
As a result, more hockey teams in Canada looks likely, when the opposite was true in the mid-1990’s.
The Atlanta Thrashers are selling for $110 million which goes to previous ownership plus a $60 million relocation fee, which goes to the NHL to be distributed to all teams. They originally paid $250 million for the rights to expand to Atlanta. That is a poor investment that lost value.
The NHL is stronger with hockey in Winnipeg instead of Atlanta. They would also be stronger with hockey in a successful market instead of Phoenix. There are a few more potentially troubled markets on the horizon and few places that they can be moved as successfully as Winnipeg will be.
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