NEW YORK — With the NHL cancelling more games on Monday, there is a growing frustration from some of the league’s major sponsors in the United States.
“With the league going through a labour stoppage every few years, a lot of sponsors are rethinking why they committed to the product,” one source said.
If you are looking for another reason why NHL commissioner Gary Bettman and deputy commissioner Bill Daly looked more emotionally involved when addressing the media Thursday when talks broke off, this latest development plays a larger role than it appears.
For the first time in Bettman’s 20-year involvement as league boss, he’s feeling a lot of pressure from sponsors. The big companies sympathized during previous lockouts but with the sides so close in the negotiation process, yet so far, companies (at least south of the border) are starting to lose their patience.
It comes as no shock that the chief negotiator for all of these sponsorship deals, NHL COO John Collins, is reportedly rethinking his spot within the NHL, as the deals he struck are getting undermined without his control. Collins has since denied reports of his discontent.
The players are aware of this situation. It’s because of this, along with their confidence in their leader, that the union is more united than it has ever been.
Meanwhile, the NHL cancelled games through Dec. 30 on Monday. The existing schedule as comprised at the moment is rendered useless, as arenas will keep the dates for the sole purpose of presenting a repackaged schedule should a deal eventually get struck.
The good news is that both sides are inclined to meet again at some point this week. But until the NHL comes out and says the next round of cancellations will be the whole season, this could go on for awhile.
Hockey is ranked between fifth and seventh in sports ratings in the United States, depending on the time of year. But sports content is king right now for TV networks — you are seeing record revenues brought in through content deals.
Live sport has longevity, unlike other genres in the entertainment world, and cable companies are paying out in record numbers. You really can’t PVR live sports without accidentally stumbling on the results via Twitter, which makes it an attractive entity to buy commercial time. It’s another reason why you won’t see a cheap subscription option for live sports, like what Netflix is for TV and movies, so long as cable companies continue to demand the content at a high price.
It’s another reason why the compromise of a 50/50 split on revenue sharing won’t have too much of a dramatic effect on the players’ salaries and why they have been receptive to ultimately being brought down to that level. And while the NHL’s viewpoint may be that they are prepared to shut its doors to make sure each franchise is stable for years to come, it won’t stop sponsorship angst that is brewing which could ultimately do the most damage when this is all said and done.