The National Hockey League is allowing a good deal of talk about the possibility of a franchise in Las Vegas, and maybe even expansion into Kansas City.
One has to wonder why.
The expansion issue itself is understandable. They NHL has just recorded the lowest ratings in the history of over-the-air broadcast television in the United States and their cable ratings would be laughable if they weren’t so pathetic and, in many markets, unwatchable.
Clearly now revenue from television is coming to the NHL in the immediate future and that’s a problem for owners who: a) want to have more money coming in and, b) are wary of passing on costs to their hard-core fans with yet another ticket price increase.
Hence expansion talks and rumours of franchise shifting. It makes sense if the NHL were healthy, moving the Predators out of Nashville and into the Eastern Conference, a likely but still dicey proposal, and adding two teams in the West, Vegas and say Kansas City, gives the league balance in that it could move a club like Detroit back into the East and have two more in the West and everything would balance out.
The money would help as well. For reasons that mystify everyone but Jim Balsillie, the current bidder on the Preds, the new price point for an established NHL team is $240 million.
Nice, and almost double the assumed value as guesstimated by Forbes Magazine.
If that price holds up and the sale go through is it not fair to assume the going rate for an expansion franchise wouldn’t also be double the last price of $80 million. That would be a $160 million tab and it’s hard to imagine the NHL owners would walk away, for the good of the game of course, from that kind of a windfall.
Now whether or not you believe Vegas and K.C. are hockey towns is up to you.
I don’t.
For all the talk about Vegas being the fastest growing city in the U.S. it’s still pretty small in terms of population and television market size (actually just outside the U.S, top 50 in terms of TV). It also has no arena, no hockey roots, no corporate sponsorship opportunities short of gaming houses, something the NHL is not overly anxious to embrace.
Kansas City has grown a bit since its last brush with the NHL, the long-dead Scouts, but that doesn’t make it a hockey town and it too would still be a small market, likely to be clamoring for revenue sharing than putting the league in the economic black.
Your thoughts.
Whether it's Kansas City and Las Vegas you're talking about, or even Hamilton and Winnipeg, NHL expansion is a BAD, BAD, BAAAD IDEA!!! For the love of God, someone needs to stop Gary Bettman from attempting to execute this blatant cash grab before it's too late!
One has to like the sound of "(insert year here) Stanley Cup Champion Las Vegas Gold"...I give it 25 years tops and we'll see it - for better or for worse - as for Kansas City - fuggedaboudit...
I can't believe KC was thought of as an option to move Pittsburgh to. Does anyone remember that their previous NHL franchise lasted a total of two years and only sold 2,000 tickets per game at the end?
The NHL is in a complete mess, and instead of admitting where mistakes have been made and going in the right direction, Bettman and Co. are "staying the course" - hmm.. reminds you a little of another leader in command, doesn't it?
If there is to be relocation of a franchise, aside from Canada the only American destination that would make sense from a business standpoint is Houston (granted it is in the south). Their AHL team the Aeros do very well in attendance and they are a sports city. Might I add they are the 4th largest city in the U.S. Their financial success would be similar to that of Dallas. Houston also has a lot of transplants (Canadians and Northerners)
And if its expansion, Houston should be next since the Blue Jackets were going to go to Houston originally with the help of Les Alexander and Bob McNair. (Rockets and Texans owners)
I am getting a bit tired of hearing KC as a viable option.
Vegas obviously is a tourist city. The NHL will hardly be the biggest show there. I bet Siegfried and Roy would sell more tickets then any Vegas hockey franchise would. People on their vacations would rather spend there money else where then seeing a hockey game. There just interested in the product.
KC I get the feeling would be another Nashville. Fans would rather pay attention to the Chiefs, Royals and any college basketball before NHL hockey. Bettman needs to realize the expansion isn't the way to go here.
Dont just blame Bettman i agree that he is a IDIOT, but in reality the owners are the ones who finalize the expansion, he is just the puppet helping to line there pockets.
The number one city in both the United States and Canada to currently put a hockey team is....in SEATTLE. This city is a market waiting to blossom. Great AHL support for multiple surrounding area teams. This is the place to be for the NHL.
Expansion is not what this league needs right now, or in the next several years. I thought we had the lockout so Bettman could have "30 healthy franchises", and yet 2 years later, we still don't even have that, although we do have more level competition between teams. Bettman is no good for the NHL, time for him to hit the highway, go be a patent lawyer or something. Please hire a Canadian for Commish, then this stuff would stop happening. And stop raising the salary cap when the revenue clearly doesn't justify it...all it does is allow my Leafs to keep over paying 40 year olds! The NHL is the most frustrating league to watch, as it heads in completely wrong directions, has no idea how to discipline repeat offenders (this means YOU Pronger!) and makes stupid rule changes every year. Boo. On the other hand, I'll keep watching, since it's in my blood, grew up with the game, here in Canada!
Contraction NOT expansion.
Kelley, you hit the nail on the head. I can see the reasons for the league putting those poison pills into the Penguins sale, but they cant do squat at $240M, the rest of the owners will hang Bettman if he bungles this one. And once he's in the fraternity, there's no stopping him.
Kansas City will get a team because they have a new arena which is controlled by AIG, the same owners of the LA Kings. They're also the ones behind the London NHL games next fall. I cant see Vegas unless Bruckheimer built an arena and basically funded the team like a sugar daddy. That team would have to be good to attract any sort of fan base.
Huston would work way better than vegas, but all this talk of K.C. makes me want to puke. The Pacific Northwest IS a hockey market. Just look at the support for WHL teams in Wash and Ore. Plus Portland and Seattle were the first two american teams to challenge for the Stanley Cup in the old PCHL days. Not to mention that they became the blackhawks and Rangers. Put it together, proven hockey support, History and a growing population base = way better opportunity than K.C.
The NHL must contract first. Get down to 24 strong markets, which might need to include both buying back some franchises and moving others. The consolidation of talent will make for much better teams and hockey. That will attract the fanbase and television will then follow. This is what should have happened during the lockout. The more the NHL waters down its teams, the more it pours down the drain.
If the NHL had an ounce of common sense, (we all know the answer to that one!), it would cut down on the number of teams. I would suggest 16. A Canadian division of 8, and a US division of 8. The schedule would be fully balanced. That way hockey would become the great on ice product it used to be, instead of the watered down version it now is. Half of the so called NHL'ers now, could not be the stickboy in the old 6 team league. Let Elvis stay in Nashville and get hockey somewhere else where it is appreciated. It is absolutely ridiculous that Winnipeg does not have an NHL team. However, we all know that this will not happen, because Bettman is a total incompetent, and the NHL front office is a farce. So the NHL will continue to limp along in American cities who do not give a damn. The best thing the NHL could do is fire Bettman and hire a real hockey person to fix things. I know he is otherwise employed right now, but how about Ken Dryden?? A Hall of Famer, educated, articulate---works for me. As long as Bettman is there, it will continue to be a disaster.
Jim, I'm a huge fan of your column.
A couple comments:
a) There have been many comments over the last 3 years from other organizations regarding Nashville & their management. I understand revenue sharing, but it has got to be painful when you give a team xx millions of dollars so they can sign marquee players like Forsberg and kick you out of the playoff race. That being said, the lack of support from the business world is probably the nail in the coffin.
Let's face it - what's the win-win for local businesses in Nashville that would seduce their support? If the fans & fan recognition aren't there, no playoff hockey past the first round compared to the other expansion cousins, and being in a non-traditional market, I think the experiment is over. I respect the CEO of RIM, he is a champion and they have a long business history prior to the Blackberry. The NHL owners circle needs a change, and I hope he is given the support to relocate the franchise. If he is veto'd by Toronto or Buffalo in his relocation plans, it will be very disappointing.
b) Regarding Vegas - you can't build a fan base on a city that is tourist-based. The only appeal is the amount of money flow within the city. But I think it would be a mockery to put an NHL franchise there.
Thanks,
Sam
Hmm...contraction is an option but not down to less than 24 teams. Expansion? The NHL should instead relocate the franchises that lose money to real hockey markets and grow from there. Expansion into new territory should be done after the NHL takes advantage of opportunities that are guaranteed money-makers i.e. Seattle, Ontario, Houston.
This is the sad reality of the capitalist world in which we live. One can't blame owners for attempting to move their teams to money-rich, albeit non-traditional hockey markets. Indeed, more overall revenue can be had in a richer city like Atlanta, even though Winnipeg's attendance would far exceed that of any southern American team. Furthermore, Bettman can't really be blamed for seeking the hefty franchise fees that Jim mentioned.
However, as with many things in this world, the NHL is becoming a watered down, flabby semblance of its former raw self. For the good of the game's spirit, 15-20 teams and 8-10 in Canada is the best option. However, the NHL cannot sustain its existence in today's market without selling out. Thus, the spirit of the game is lost forever.
These are sad times for hockey.
Kudos on a good article, Jim.
Good column - a couple of points:
Contraction will NEVER happen - it would devastate the value of the other teams, which somehow is continuing going up. Best solution - move a couple of Nashville types elsewhere which could include a Canadian desination. Markets like Houston and Seattle should have been considered before Nashville anyway. Another team in the Northwest is deserved as they support hockey and would help the travel condition of the western Canadian teams!
Entrance to the NHL should be altered. New teams should have a minimum number of season tickets and corporate suites presold to qualify - THIS would prevent the embarrassment the NHL has experienced. Winnipeg or Vegas or whoever wants a team? then demonstrate your committment and buy your tickets and more importantly those luxury suites. NO COMMITTMENT, NO TEAM - END OF DISCUSSION.
So the owners don't want to keep passing rising costs onto the fans? Well then stop spending money! Set a reasonable ticket price and balance your books to get there. Since ticket sales are the primary point of revenue, lowering ticket prices across the board would result in less revenue, sure, but why is that a bad thing? Less revenue means the salary cap comes down which means their costs come down. With the 54% rule, the owners have the ability to make money either way, but at least with the lower ticket prices it draws more people in (to hopefully make fans out of them) and stops the ridiculous escalation of salaries that we are still seeing because the cap goes up millions of dollars each year. With the 54% rule, owners are guaranteed to be in an environment where they can make money. They just have to stop being so greedy that ticket prices actually stay in some kind of semblance of an affordable range...
Never gonna happen, of course. Never accused the owners of being logical.
Nothing suprises me anymore with the NHL. The incompetence has reached epidemic proportions, and the league is doomed to reside in the dustbin of history if the current path that the NHL is on continues unabated. With every contention about how great and solid the league is, and how attendence seems to be miraculously breaking annual records even though empty seats and cavernous echos from pucks hitting sticks abound, the noses on Bettman and company are getting longer and longer. As a former fan I marvel at how many people still are willing to swallow what is being peddled rather than come to the conclusion that the sport will only survive when it is cut to 16-20 teams, half of which reside north of the border, and expeditures are aligned with revenues.
There are now 3 major sports in North America. And that's as it should be. Until the powers that be realize this simple fact they will continue to sing the praises of their flawed product and, like good Captains, go down with the ship. The smart ones will get out now and sell their $100M franchises to rich suckers for double. I guess idiots attract other idiots...
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Expansion would be a very bad idea for the NHL right now. It needs to worry about its current markets before it should even consider expanding into other markets. Teams like Anaheim, Carolina, Atlanta, Nashville, Phoenix, Florida, and so on. Could all be relocated or just shut down and would in my opinion make the game stronger. The only real cities in America that I would want to see a team in or would actually make some sense is Portland, OR and Seattle, WA. K.C are you kidding me! and Vegas would be a complete failure. Could you imagine the arena having a casino in it? I think Winnipeg would be a good situation for the NHL as well as returning to Quebec City. Bettman needs to go, and then the game will be health, because he has failed to admit that Expansion into Southern USA has failed, for all we know there will be a team in Hawaii in 20 years.
Bottom line - if the game does not exist at the grassroots level it won't be successful in that marketplace. - The NHL should stop trying to force a square peg through a round hole by putting the game in non traditional markets.
My advice - contract to 24 teams and experiment with EUROPE!! people are crazy about hockey over there... half the league is European.
Each team should have to go overseas for four games and play the top teams in Europe. Then euro teams should come over here for four games. the fans in the US won't watch it on TV but the fans in Europe sure will!
I really can't see the NHL down sizing...I think they will look at expansion to 32 teams in the next five years. It would be great to see Winnipeg + Quebec again. I wouldn't bet on it though. Money talks, and I think KC is the most likely destination right now. I really think the NHL would love being in Vegas - movie stars, big wheels, etc.
No more expansion in North America. Move the Preds to Hamilton and the next faltering US Franchise to Seattle.
After that start a European division with 6 or 8 teams. Stick to your core Bettman instead of trying to expand where the game has no roots.