Here comes expansion! Part III - Bids Only from Vegas, Quebec City

[Major4Boarding]

Previous Thread - http://hfboards.mandatory.com/showthread.php?t=1916349

Carry on!

Click to read more...

 

[wildthing202]

Again, I don't disagree. Rather, i am trying to describe what I think to be Bettman's reasoning and that of the BOG.

I personally think they have a system that needs overhauling, because of the revenue disparity between Toronto/Rangers/Montreal/Boston and Nashville/Tampa/Glendale.

It can't work long term without more revenue sharing. That why the big national media contact is so important to them. But that is not going to appear.

So, they should move Glendale to Quebec. Then, sit down with Foley for a long talk about the future of that City of it gets a team. Then, sit down with Bartozek and/or Coleman the same way. In both cases, they should talk about promotion of the game and the team AHEAD of its arrival in the market. Then, they stood all sit down together and talk about how to share more revenue so the lower revenue teams don't get squeezed by the CBA.

But I don't think they are savvy enough to figure that out.

TV execs can't be that stupid can they? They don't just plunk down money just because you put a team in a populated city do they? I would think they would do some research. Buffalo is a small city but it's TV ratings just crush nearly all the other American teams in the league vs. Phoenix which is a fairly large city with minuscule ratings. I would think TV execs would rather have 24 Buffaloes than 24 Phoenixes. There is potential to consider but when you have almost 20 years of data to draw upon it seems clear that just because you put a team in a large market that doesn't mean everyone is going to watch it. I would think this is why Buffalo is on NBC and NBCSN a lot more than Phoenix is. People who watch the game are worth more than people who don't so I would think the league would be better off putting teams in markets where they will succeed in rather than just plunking them down in areas of the map where there isn't a team currently just to fill out the map.

 

[MNNumbers]

^^^^
Correct. That's why I said the big contract is not coming.

The owners keep hoping, for several reasons. One, more money.... Two, it's shared money.

As I have said, the big problem with the league is revenue disparity.

This expansion cash grab won't solve that.

This league should do this:

1-Strongly encourage IA to sell to Quebecor.

2-Privately acknowledge that Vegas and Seattle are the best candidates for expansion.

3-Sit down privately with each group and discuss how to market BEFORE the team arrives.

4-Implement the idea seen here to change the cap/floor system to use median instant of mean. That will leave the players short of their 50%. Use revenue from the high revenue teams to make up for that.

But I don't think they are savvy enough to do that.

 

[Killion]

Hum... Fugu. I think the guy knows his health better then we do.

Also, I find your agism pretty freaking offensive. I mean, I think some fat 40 year old morbidly obese billionaire would be a lot more likely to die tomorrow then Foley.

Also, I (or Pierre-Karl Peladeau, or Steve Balmer, or anyone) could get run over by a drunk driver any day. Does it mean we should never do anything?

Seriously, the agism in today's society is freaking ridiculous. Older people ought to be able to live their lives without a lot of people acting like they'll drop dead without warning in the next few minutes!

... very true, however when considering the viability of a franchise long~term as we are the case of Las Vegas such a question is absolutely appropriate. Foley is the driving force & visionary behind this bid. One simply must consider succession, as you just dont know how many innings he might have left in him at an already advanced age. Lets hope its at least 10-15, which outside would put him somewhere in his mid to late 80's but Boy, thats pushin it Ace. With the Maloofs as his partners in this late-lafe adventure, you can bet they'll have first right of refusal on his shares unless something occurs in the interim with respect to a sale or estate planning. And when it comes to the Maloof family, all bets are off Buddy. Some seriously High Strangeness goin on there. Dunno. Could prove highly entertaining, probably will be. The Maloofs at one time back in the early 90's looking at Tampa.

Oh please. Ageism? You're truly reaching now..... I posted this elsewhere, but Karmanos is the SAME age as Foley. You know what Karmanos is doing? He's trying to find a buyer who will take over within five years. Why? His age. It's called succession planning.

Yeah, "ageism". Personally, I wouldnt pay you 5 cents, in fact youd have to pay me quite a bit to go see a Stones Concert & Id want earplugs. In fact so beyond wasted Id pass out & sleep through it if possible. 74yr old drummer, Keef & Mick 71, Ron Wood like 68 or 69. Unsightly, has been in fact for decades, havent even put out a decent album since about 1975 but I digress.... Jaggers voice-box beyond shot, prancing around up there... my God, where's your dignity Man?. Get off the stage already... anyhoo.... I guess ones 70's are now ones New Age 50's. Baby Boomers. Gunna live forever huh? Yeah. Dont think so.

^^^^Correct. That's why I said the big contract is not coming.... The owners keep hoping, for several reasons. One, more money.... Two, it's shared money.

The only way that $500M Expansion Fee # would pencil out favorably would be with an NBA like national broadcasting contract and no, I agree, that is just not going to happen. Even in the so called Cradle of Hockey, Canada, Im seriously wondering if Rogers even makes it to year 10 with that $2B+++ investment in the NHL without completely unwinding & having to prop up that massive loss in selling off assets & or jacking up consumer rates right across the board. This "fixed fee" ala carte Expansion process is a relic of the past. Youd think in 2015 the NHL would have a clue, be taking the long-view, using some critical thought, selling Exp Franchises for what are reasonable amounts that would give the new ownership group in newer markets like Las Vegas a real fighting chance rather than setting things up for more fail after fail after fail, intransigent ownership, league welfare recipients, Relocation candidates.... But then I guess, why care MNN? These guys will all be dead by then. Cant take it with you. Might as well cash those chips in now huh? Let the next generation worry about it.... and ooops, there goes that ageism thing again.... sorry.... carry on.

 

[Fugu]

Here's some info on the arena readiness for the last 4 expansion teams I pulled up on wikipedia.

NSH, CLB, ATL & MIN were all awarded franchises in June 1997 and the 4 teams entered the league in a staggered expansion to accommodate new arenas for 3 of the new teams. 2 of these teams even waited a full year after the team was granted until they had their arena deals worked out completely - so there is a recent precedent for Seattle, Toronto2 or other wild card cities.

Nashville was the only city with an arena built so they started in 1998. This was just after they tried to lure the Devils to town in 95. Nashville also had to prove support by getting 12,000 season tickets in 9 months.

Atlanta waited for its arena to be ready for when they started playing in 99. Phillips Arena broke ground after the old Omni arena was imploded in July 97 at the same site; it opened in Sept 99.

Columbus waited 3 years to start playing in 2000. Columbus did not have an areana. The voters of Columbus were considering a referendum to build a publicly financed arena, a major step toward approval of their NHL bid. Bettman visited Columbus to meet with the community's leaders about the franchise proposal, there was concern that the voters might not pass the needed referendum. The civic leaders told Bettman that they would not be willing to foot the bill for the team if the referendum failed. In May 97, the referendum failed but at the end of the month Nationwide came to the plate to offer the $150M for the arena. The city was granted a team the next month; the arena broke ground in May 98 and opened in 2000.

Minnesota started in 2000 as well. The State of Minnesota adopted legislation in April, 1998 to loan $65 million to the City of St. Paul to fund 50% of the estimated $130 million project costs for the Xcel Energy Center in St. Paul. It broke ground in June 98 and opened in Sept 2000.

I wanted to make sure this post carried over since it was posted close to the last expansion thread's limit.

It bears repeating that the league said an arena doesn't have to be ready, just enough to show that it's going to happen, financing lined up, etc.

 

[Fugu]

It would be funny to see a city of 222,000 thrive in the NHL and outdo markets that are 10x their size. I can't see it happening though....if the Blues had moved there back in the day maybe Saskatoon would be like the Packers in the NFL but it's not going to happen these days.

An NHL franchise cannot thrive on gate receipts alone. I don't care how hockey crazed they may be there, they simply don't have the corporate base to support a modern NHL team.

 

[Fugu]

it's become increasingly clear that Bettman views all revenue streams within all markets and adds them up to derive a total market revenue value. clearly, hamilton for example, would dwarf gate revenues of phoenix, and vegas. no question whatsoever about that. so, why does he insist on keeping/putting teams in the desert? answer: he sees other, non-gate, revenues streams. national, television broadcast content and market coverage seems to be the primary revenue stream here. (it is also the revenue stream that seems to underscore interest in the seattle market as well. gate in seattle will be middling at best.)

the presumption is that placing franchises in markets where people will come to watch games on TV, and that is the driving force here. it is based entirely on the premise that NBC (or whatever media company bids for the new US contract) will pay the NHL more if it includes content from/to viewers in these markets.

im not sure I buy this premise.

Let's look at it another way. NBC has the national rights. Would they prefer a Phoenix x Chicago game to broadcast, or Chicago x Winnipeg or Quebec City?

Boston/Det or Bost x QC? NYR x Vegas or LA x Vegas or LA vs Winnipeg/Edmonton/Calgary?

clearly, TV viewership in Phoenix and Atlanta are/were abysmal. lost gate revenues (compared to any reasonable Canadian location) are then hoped to be made up by television revenues. but that has simply not been the case. and it is reasonable to assume that NBC (or whoever) would not pay that much more for the national contract whether Phoenix or Altanta were in the mix. neither market does/would generate additional broadcast revenues.

As the above may illustrate, maybe they're not looking at just that local market's ratings.

the real question is whether teams in vegas or seattle would be sufficient attraction to NBC (or whoever) to pay the NHL much more for those broadcast rights. assuming that a team in Hamilton would net gate revenues of $25M more each and every year, over and above what Seattle or Vegas would generate ... and that gets tossed into the HRR pot ... that means that non-gate revenues in those US markets would have to match or exceed Hamilton by that same amount to gross the same total. frankly, im not convinced that NBC (or whoever) is willing to pay that much more, over and above what it would otherwise have paid, just to have content/viewers from those markets.

in other words, i doubt that teams in seattle and or vegas would help net greater overall HRR compared to teams in Canadian, gate-crazy, markets like Hamilton. which suggests that this may be more than just money for Bettman.

The new markets in Canada do nothing to help NBC increase viewership, and some might say that it might have the opposite effect.

Now, turning to Canada, would Rogers gain enough in eyeballs by adding these markets to offset the fact that the 7 Canadian teams get a bit more of that money, plus the US teams share in the more lucrative contract from Canada? When you Canadian teams, it costs the current teams more in terms of what's left to share than if you added the US teams. Is that going to offset by Rogers increasing what they're already choking on if you added two more Canadian teams? They've already monetized the Quebec portion.

 

[Killion]

The new markets in Canada do nothing to help NBC increase viewership, and some might say that it might have the opposite effect.

No they dont but so what when a new team in Quebec, Hamilton or Toronto would receive about 30X's more in local broadcast rights while nationally Rogers or TSN or whomever would have to pay even more for national rights? If casual NHL fans in the States will only watch American vs American teams during the Regular Season and it then takes generations to cultivate these fans, why would you be expanding into markets that require such at the expense of your already existing traditionalists & forsake all that lovely lucre right now? Theyve been chasing that dream since the early 50's when the NFL signed the first really lucrative broadcasting contract & turned heads in NY & elsewhere. Why should that objective over-ride the interests of broadcasters in Canada who pay 10X's more for National & anywhere from twice as much to 30X's as much for local broadcast rights? Talk about the tail wagging the dog.

 

[Fugu]

Yeah, "ageism". Personally, I wouldnt pay you 5 cents, in fact youd have to pay me quite a bit to go see a Stones Concert & Id want earplugs. In fact so beyond wasted Id pass out & sleep through it if possible. 74yr old drummer, Keef & Mick 71, Ron Wood like 68 or 69. Unsightly, has been in fact for decades, havent even put out a decent album since about 1975 but I digress.... Jaggers voice-box beyond shot, prancing around up there... my God, where's your dignity Man?. Get off the stage already... anyhoo.... I guess ones 70's are now ones New Age 50's. Baby Boomers. Gunna live forever huh? Yeah. Dont think so.

Mick and the boys are about my mother's age (72). Mick is dating a lady who is 5 yrs older than my daughter (she's 21).

Ronnie left his wife in 2008 for an 18 yr old, and is currently married to someone who is 31 yrs younger than him. I'm sure these women were smitten, love at first sight.

 

[Killion]

^^^^ yeah, those pictures speak a 1000 words & dont lie. Unbelievable. Freak show.

 

[Mightygoose]

The new markets in Canada do nothing to help NBC increase viewership, and some might say that it might have the opposite effect.

Now, turning to Canada, would Rogers gain enough in eyeballs by adding these markets to offset the fact that the 7 Canadian teams get a bit more of that money, plus the US teams share in the more lucrative contract from Canada? When you Canadian teams, it costs the current teams more in terms of what's left to share than if you added the US teams. Is that going to offset by Rogers increasing what they're already choking on if you added two more Canadian teams? They've already monetized the Quebec portion.

The big reason why this price tag starts with a 5

I think it works the opposite as well. Would the new US markets really add allot of eyeballs to the Rogers viewers? Maybe Seattle, but not Vegas or anywhere else.

I agree, Rogers has already cashed in on Quebec with the sub contract, QC I see as a regional franchise as opposed to any impact on a national scale.

But a second team in TO/GTHA, It will definitely add value to the Rogers deal, largest media market in the country. Even more if GTA 2 is a western conference team. Now weather it happens is a different story, where the price starts and ends will make much different conversation.

 

[Fugu]

No they dont but so what when a new team in Quebec, Hamilton or Toronto would receive about 30X's more in local broadcast rights while nationally Rogers or TSN or whomever would have to pay even more for national rights? [1] If casual NHL fans in the States will only watch American vs American teams during the Regular Season and it then takes generations to cultivate these fans, why would you be expanding into markets that require such at the expense of your already existing traditionalists & forsake all that lovely lucre right now? Theyve been chasing that dream since the early 50's [2] when the NFL signed the first really lucrative broadcasting contract & turned heads in NY & elsewhere. Why should that objective over-ride the interests of broadcasters in Canada who pay 10X's more for National & anywhere from twice as much to 30X's as much for local broadcast rights? Talk about the tail wagging the dog.

[1] Would they?

Local rights in Winnipeg and Edmonton are worth how much? What would they be worth in Quebec City? Regardless of that answer, there is nothing that the other teams gain from this, even if these newer Canadian markets are able to pay their own freight.

Nationally, the Rogers money gives up some of the Canadian money to the seven teams (those "invasion fees") in return for the rights to broadcast some number of games nationally (20, iirc), correct?

That leaves less to share among the US teams.

Is the question then, "Can they pay their own way?" or "What's in it for me, after the expansion fee?"

We all know the Canadian teams will be able to pay their own freight, barring a CAD that goes to 0.70 USD or lower.

[2] Yes, they have been chasing that footprint, and look no further than the last expansion (Nashville, Tampa, SJ, Anaheim, Atlanta, Florida, Minnesota, etc.)--- plus the abandonment of TWO Canadian markets!

You tell me why Las Vegas is in the same discussion as QC and Toronto2 then.

 

[HamiltonFan]

^^^^
Correct. That's why I said the big contract is not coming.

The owners keep hoping, for several reasons. One, more money.... Two, it's shared money.

As I have said, the big problem with the league is revenue disparity.

This expansion cash grab won't solve that.

This league should do this:

1-Strongly encourage IA to sell to Quebecor.

2-Privately acknowledge that Vegas and Seattle are the best candidates for expansion.

3-Sit down privately with each group and discuss how to market BEFORE the team arrives.

4-Implement the idea seen here to change the cap/floor system to use median instant of mean. That will leave the players short of their 50%. Use revenue from the high revenue teams to make up for that.

But I don't think they are savvy enough to do that.

The problem is revenue disparity, yet the best candidate for expansion is a financial basket case like Vegas which would almost certainly be the #31 team in revenue once the honeymoon phase of the first season or 2 is over?

 

[HamiltonFan]

... very true, however when considering the viability of a franchise long~term as we are the case of Las Vegas such a question is absolutely appropriate. Foley is the driving force & visionary behind this bid. One simply must consider succession, as you just dont know how many innings he might have left in him at an already advanced age. Lets hope its at least 10-15, which outside would put him somewhere in his mid to late 80's but Boy, thats pushin it Ace. With the Maloofs as his partners in this late-lafe adventure, you can bet they'll have first right of refusal on his shares unless something occurs in the interim with respect to a sale or estate planning. And when it comes to the Maloof family, all bets are off Buddy. Some seriously High Strangeness goin on there. Dunno. Could prove highly entertaining, probably will be. The Maloofs at one time back in the early 90's looking at Tampa.



Yeah, "ageism". Personally, I wouldnt pay you 5 cents, in fact youd have to pay me quite a bit to go see a Stones Concert & Id want earplugs. In fact so beyond wasted Id pass out & sleep through it if possible. 74yr old drummer, Keef & Mick 71, Ron Wood like 68 or 69. Unsightly, has been in fact for decades, havent even put out a decent album since about 1975 but I digress.... Jaggers voice-box beyond shot, prancing around up there... my God, where's your dignity Man?. Get off the stage already... anyhoo.... I guess ones 70's are now ones New Age 50's. Baby Boomers. Gunna live forever huh? Yeah. Dont think so.



The only way that $500M Expansion Fee # would pencil out favorably would be with an NBA like national broadcasting contract and no, I agree, that is just not going to happen. Even in the so called Cradle of Hockey, Canada, Im seriously wondering if Rogers even makes it to year 10 with that $2B+++ investment in the NHL without completely unwinding & having to prop up that massive loss in selling off assets & or jacking up consumer rates right across the board. This "fixed fee" ala carte Expansion process is a relic of the past. Youd think in 2015 the NHL would have a clue, be taking the long-view, using some critical thought, selling Exp Franchises for what are reasonable amounts that would give the new ownership group in newer markets like Las Vegas a real fighting chance rather than setting things up for more fail after fail after fail, intransigent ownership, league welfare recipients, Relocation candidates.... But then I guess, why care MNN? These guys will all be dead by then. Cant take it with you. Might as well cash those chips in now huh? Let the next generation worry about it.... and ooops, there goes that ageism thing again.... sorry.... carry on.

Rogers annual revenue is approximately $13B.

They pay about $400M/year for the tv contract. Consensus seems to be that they are close to breaking even, but lets say for arguments sake that they are only getting $300M in revenue from their $400M investment. That means the rest of Rogers business (13B-400M=12.6B) needs to increase revenue by $100M to make up for the $100M in hockey losses. 100M is not even 1% of 12.6B. In other words, the rest of Rogers business would only have to increase revenues by less than 1% to make up for a 100M shortfall in hockey revenue. You can see that moderate losses in hockey revenue barely moves the needle as far as Rogers overall business is concerned. No need for Rogers to sell off assets or significantly jack up consumer rates across the board.

 

[HamiltonFan]

Let's look at it another way. NBC has the national rights. Would they prefer a Phoenix x Chicago game to broadcast, or Chicago x Winnipeg or Quebec City?

Boston/Det or Bost x QC? NYR x Vegas or LA x Vegas or LA vs Winnipeg/Edmonton/Calgary?




As the above may illustrate, maybe they're not looking at just that local market's ratings.




The new markets in Canada do nothing to help NBC increase viewership, and some might say that it might have the opposite effect.

Now, turning to Canada, would Rogers gain enough in eyeballs by adding these markets to offset the fact that the 7 Canadian teams get a bit more of that money, plus the US teams share in the more lucrative contract from Canada? When you Canadian teams, it costs the current teams more in terms of what's left to share than if you added the US teams. Is that going to offset by Rogers increasing what they're already choking on if you added two more Canadian teams? They've already monetized the Quebec portion.

I may be wrong on this, but I'm pretty sure there was a thread a few months back that concluded that under this new rogers tv deal, money is now split evenly amongst all 30 teams. No preferential treatment to Canadian teams as in the previous contract.

 

[BattleBorn]

The problem is revenue disparity, yet the best candidate for expansion is a financial basket case like Vegas which would almost certainly be the #31 team in revenue once the honeymoon phase of the first season or 2 is over?

Don't let your bias cloud your vision. Vegas is an 18-25 revenue generator all day long. Short of GTA there isn't a Top 15 available anywhere.

 

[Killion]

You tell me why Las Vegas is in the same discussion as QC and Toronto2 then.

Because just like back in the early 90's when the NHL was expanding by 2 with a then very hefty $50M entry fee, only Phil Esposito & Ottawa were willing to pay that price. In the case of Tampa, Peter Karmanos was willing & able but only willing to pay app $28M. Hamilton with Ron Joyce, same thing, wasnt willing to pay twice as much as what his numbers penciled out at on top of which, moving target with respect to indemnification fee's. So..... looking in the rearview mirror, Esposito's backers pulled out 3wks before the announcement of which cities won entry, and when Tampas' announced, Phil sweating bullets because he didnt have the $50M. And we know who he finally turned to huh? NHL in bed with the Yakuza, no arena for their 1st 4yrs, Horror Story of ownership ever since until seemingly Vinik's arrival..... Ottawa, they build way the Hell out in Kanata, winter driving conditions in that area always iffy, major development planned, they go BK, up & down we go, and now after just 23yrs are looking at having to build a new arena & much more sensibly in the urban center. Ottawa itself not exactly a heavyweight in terms of corporate. Small market. Yet they had no problem dropping $50M, double what it was worth. And so here we are with Vegas, absolutely desperate to be taken seriously as Big City Big League, validation being a Big 4 franchise. Forget MLB & the NFL, the NBA apparently not interested so they go bottom rung of the Top 4 with the NHL. $500M? No problem. No bickering. Were in. Not worth half that amount but so what? Its validation and like Ballmer a vanity purchase. Buy on emotion, justify with faulty logic later on. You can parse the numbers - $500M - 10 ways from this Sunday, today, they dont add up.

 

[gstommylee]

Don't let your bias cloud your vision. Vegas is an 18-25 revenue generator all day long. Short of GTA there isn't a Top 15 available anywhere.

Seattle wouldn't fit in that top 15?

 

[BattleBorn]

Seattle wouldn't fit in that top 15?

Look at the teams currently there in HRR and tell me. I don't see it, especially if the Sonics come back at the same time. 16-22 in my head.

 

[Slot]

^^^^ yeah, those pictures speak a 1000 words & dont lie. Unbelievable. Freak show.

"I find you strangely attractive"

"Of course you do, women are often attracted to money and power. I have both any you know it"

Good old spaceballs.

 

[Fugu]

I may be wrong on this, but I'm pretty sure there was a thread a few months back that concluded that under this new rogers tv deal, money is now split evenly amongst all 30 teams. No preferential treatment to Canadian teams as in the previous contract.

I'm not sure we ever fully resolved it. The first time I heard of "invasion fees" was when the Rogers contract was announced.

"I find you strangely attractive"

"Of course you do, women are often attracted to money and power. I have both any you know it"

Good old spaceballs.

You speak for what women find attractive now? I'm sure there are men who might find a wealthy woman attractive beyond her looks too, eh?

Speaking for myself, I don't find anything attractive about the gents above.

 

[Fugu]

Rogers annual revenue is approximately $13B.

They pay about $400M/year for the tv contract. Consensus seems to be that they are close to breaking even, but lets say for arguments sake that they are only getting $300M in revenue from their $400M investment. That means the rest of Rogers business (13B-400M=12.6B) needs to increase revenue by $100M to make up for the $100M in hockey losses. 100M is not even 1% of 12.6B. In other words, the rest of Rogers business would only have to increase revenues by less than 1% to make up for a 100M shortfall in hockey revenue. You can see that moderate losses in hockey revenue barely moves the needle as far as Rogers overall business is concerned. No need for Rogers to sell off assets or significantly jack up consumer rates across the board.

Which corporation runs their business like this, a vanity investment? Their responsibility and accountability is to their shareholders and stock prices. If this contract does nothing to increase share value and dividends, it's a bad business decision.

Seattle wouldn't fit in that top 15?

I think it has the potential to be in the 12-16 range, especially from the corporate sponsorship side. Tickets should be at least NHL average since everything else out here is, in terms of how expensive and income levels, is on the higher end for the US.

 

[Killion]

Rogers annual revenue is approximately $13B.

They pay about $400M/year for the tv contract. Consensus seems to be that they are close to breaking even, but lets say for arguments sake that they are only getting $300M in revenue from their $400M investment. That means the rest of Rogers business (13B-400M=12.6B) needs to increase revenue by $100M to make up for the $100M in hockey losses. 100M is not even 1% of 12.6B. In other words, the rest of Rogers business would only have to increase revenues by less than 1% to make up for a 100M shortfall in hockey revenue. You can see that moderate losses in hockey revenue barely moves the needle as far as Rogers overall business is concerned. No need for Rogers to sell off assets or significantly jack up consumer rates across the board.

I think it has the potential to be in the 12-16 range, especially from the corporate sponsorship side. Tickets should be at least NHL average since everything else out here is, in terms of how expensive and income levels, is on the higher end for the US.

Pretty much what Fugu says here HF.... not to mention the already considerable amount of angst mixed with disgust over their lack of success with the Leafs & continuing dysfunction in that regard; the perceived notion right or wrong that MLSE continues to block the entry of a 2nd entry into Southern Ontario... cable cutting on the rise, no one that I know of particularly enamored with their cable/internet & or cell provider be it a Rogers, Bell or Telus or whomever... the changing systems & methods of delivery... were not talking about just losses on that broadcasting contract, the ramifications here for Rogers are much broader, wider & run deep.

 

[KevFu]

Buffalo is a small city but it's TV ratings just crush nearly all the other American teams in the league vs. Phoenix which is a fairly large city with minuscule ratings. I would think TV execs would rather have 24 Buffaloes than 24 Phoenixes. There is potential to consider but when you have almost 20 years of data to draw upon it seems clear that just because you put a team in a large market that doesn't mean everyone is going to watch it. I would think this is why Buffalo is on NBC and NBCSN a lot more than Phoenix is.

Don't let your bias cloud your vision. Vegas is an 18-25 revenue generator all day long. Short of GTA there isn't a Top 15 available anywhere.

#1 - The local TV ratings reported are a percentage of the market.

So in 2011, Buffalo led the league with a 8.3 rating. That's 54,000 households. And Phoenix was terrible at a 0.9 rating. But that's 17,000 homes. So Buffalo's ratings are 9 times as good, but only have 3x as many viewers.

#2 - NBC would rather have 24 Phoenixes than 24 Buffaloes. Good or bad, 24 Buffaloes are going to bring in a total of 1.3 million viewers locally across the country for the whole season.

But with 24 Phoenixes, not all 24 franchises will be in the midst of an ownership debacle where no one wants all 24 teams. One third of those 24 teams will bad (better than actual PHX post-bankruptcy ratings), one-third will be mediocre, and one-third will be better teams than PHX has ever seen before.

#3 - Local TV ratings for sports are stupid. At best misleading/inaccurate and at worst, just terribly wrong.

#4 - The NHL needs more revenue sharing, not because it needs to prop up franchises, but because they need to work together to make it a better league. The TV ratings/popularity of the sports and the list of sports by percentage of revenue shared are, lo and behold, THE SAME: The NHL being 4 of 4 on both lists, the NFL #1 on both lists, MLB/NBA being similar.

More revenue sharing also makes it MORE LIKELY for the league to say "We don't need a Top 10 market by population, like Houston. We'd rather be in Quebec"

#5 - NFL Los Angeles is the perfect example of both RS & What GuelphStormer was talking about with Bettman's view of revenue streams.

With 100% TV revenue sharing in the NFL (No local TV deals) and being an event sport (where teams like Green Bay sell out because the entire state comes to games, or how Denver & New Orleans have season ticket holders from multiple different states!), the fact that LA is a massive untapped market for the NFL isn't that big of a deal.

Virtually every NFL team is a Big Market Team. Big Market Teams have huge local TV rights fees (NFL is all national, and huge), their sponsorships, advertising and demand are much bigger, and with all those people in the market, they can set their prices at whatever they want and someone's going to pay it. That's all NFL teams for the most part.

So the benefit of being the LA NFL team is... what exactly, compared to any other market? Nothing unless you have a brand new stadium increasing your local revenues over what you can make in an old one. Expansion to LA wasn't a priority because buying the team and building the stadium was so damned expensive it isn't worth it. You're better off buying any NFL team that becomes available anywhere else at a cheaper price. Because you'll be dead by the time your yearly revenues offset the massive startup costs of $3 billion to build/buy in LA.

NFL LA makes the SECOND owner rich, not the FIRST. And doesn't really make the NFL that much more money.

The 30 owners in the NHL don't give a damn about LOCAL revenues, because they don't see a dime of it. The owner of the local team sees the local revenues.

Adding TV markets is their TOP expansion priority, because that's what's going to increase their slices of the pie the most.

More local revenue sharing for the NHL means more local revenue by a franchise grows the pie.

More Revenue Sharing = Good for smaller market hockey hotbeds (like Quebec, Winnipeg, Buffalo, Hartford) or markets where there's already at team (Hamilton, Toronto2).

Low Revenue Sharing = Good for expansion candidates in big TV markets without teams (Houston, Seattle, Las Vegas)

 

[Fugu]

Don't let your bias cloud your vision. Vegas is an 18-25 revenue generator all day long. Short of GTA there isn't a Top 15 available anywhere.

I'm not so sure. I think where they land will ultimately depend on the local broadcast/media rights contract they can attract. If they can only get $10-15 MM, that will put them in the bottom third unless they're making up for it with other In-arena and merchandising, sponsorships that are well ahead of other NHL teams.