KHL business aspects discussion

Jussi

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Feb 28, 2002
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It's low money, but it's growing year after year.
BTW KHL is a singular-case word

It's common the refer to a league as "they". We do the same with NHL, NBA, EPL, La Liga etc.

When that amount is shared between so many teams, it becomes very small. Do you really think Jokerit were pleased with the 35k€ they got last year?
 
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Jussi

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Feb 28, 2002
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Copied from the Jokerit thread:

http://www.kauppalehti.fi/uutiset/jokereille-jattitappiot-viime-pelikaudesta/LmPRM3nu

Massive 15 million euro loss from the 2015-16 season. Own capital is now in the minus. Turnover fell by 1,4 million euro to 10,2 million euros.13,1 million in personnel expenses, other expenses over 10 million. Capital now 1,2 million in the minus, despite taking a 21,4 million euro capital loan. They also failed to notify the the loss of capital in the business registery, which means that in case of bancrupcy, board members may personally have to answer for the company's debts.

Two seasons, 28,8 milliion euros in losses. Now wonder European teams aren't interested in joining the league.
 

vorky

@vorkywh24
Jan 23, 2010
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KHL Development Strategy, approved in 2015, has been fulfilled for 99%. All aims have been achieved. We have been working on new 7 years Development Strategy, which will contain various scenarios of development of our hockey. First of all, it will implement a recommendation of President of Russian Federation clubs to be less dependant on budgets of local governments or state corporations. Professional sport should be able to make money per se. KHL is one of most commercially successfully projects from this point of view. On one hand, we will make our clubs to be less dependant on budgets of local governments or state corporation. And from other hand, we will make more money by boosting commercial potential of our clubs.

Dmitry Chernyshenko, KHL President
Original source sportfakt.ru
 

hansomreiste

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Sep 23, 2015
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Don't know where to put it so I guess I'll go with here: table updates are just too slow on KHL mobile application. I stopped checking it after seeing that the game which had ended 30mins ago was not registered in the table yet. It was a good step to improve the experience but still with many problems. Maybe it's just me but I find it complex & difficult to navigate around the games. You need too many clicks and such. Hope they will keep improving this thing in future. Comes in handy (well, in its current state, not much) when you are not in front of your PC or TV which is the case for people for most of the time.
 

Rigafan

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Jul 28, 2016
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Don't know where to put it so I guess I'll go with here: table updates are just too slow on KHL mobile application. I stopped checking it after seeing that the game which had ended 30mins ago was not registered in the table yet. It was a good step to improve the experience but still with many problems. Maybe it's just me but I find it complex & difficult to navigate around the games. You need too many clicks and such. Hope they will keep improving this thing in future. Comes in handy (well, in its current state, not much) when you are not in front of your PC or TV which is the case for people for most of the time.

The most frustrating thing with the App for me is.. EVERY live stream stops working after so long. "video could no longer be played" I did send a report and they replied very quick saying an error with the stream from the arena.. although it happens every time :(
 

vorky

@vorkywh24
Jan 23, 2010
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Pretty true. In my country it is same. There are plenty of the garbled informations about KHL in the media and than in the public opinion. It is still same: KHL is oligarchs league, arenas are empty, arenas are old, referees are corrupt, finally - quality of the hockey is low (I have heard "opinion" - quality of the czech and slovak leagues is equal to KHL :laugh:

I have one collegue: he doesnt like KHL, but he doesnt watch KHL games. So, I said him - ok, so lets try watch any game and you see. Answer - no, because I watch only NHL and I dont care about KHL. But he everytime say that KHL is absurd and weak league. Ok, I told him, but in the NHL are weak games too (like in every league) - Yes, he answer, but it is NHL, so it is OK :laugh: so I think, this absurd article is same like discussion with my collegue.

Btw, today I watch games Avangard - Loko and Ak Bars - Magnitka, and now I watching NHL Buffalo - Winnipeg, and hockey level is very simillar IMO. But what is NHL? NHL is very good hockey and marketing. And marketing is maybe no. 1 in professional sport.

I put your reply here, not to be offtopic in original thread.

I dont follow slovak/czech media about KHL anymore, my only KHL sources are russian. Slovak/czech hockey/sport journalists dont know russian, dont follow the league too closely, dont know how russian hockey journalists work. Their only source of KHL infomations are articles translated by state agencies in SVK/CZ, which translate them only if 1) there is scandal in the league (not paying salaries, Loko disaster, low attendance in China etc) 2) someone leaving KHL for NHL or Kovy/Datsyuk caliber players signing in KHL. So it is limited amount of information and our journalists can not read original russian articles and make their own analysis because... they dont speak russian. Ordinary fans in SVK/CZ dont speak russian as well, so their only KHL informations are written in our languages by our crappy journalists.

I can imagine the same problem is in NA as well, because Americans/Canadians dont speak russian in many cases, their only information about KHL is if the NA journalist like Mirtle or Malamud (who dont follow KHL closely if at all) write something.. and they write only negative things about KHL.

Marketing - yeah, it is a problem of KHL. There was almost no marketing under Medvedev, Chernyshenko has tried to do some change, but it is not easy. Their main market is Russia, which TV market is not developed. TV revenues should be main income for league/clubs, so if your main market is not developed, your TV money is small. Like in KHL. Russia had federal public sport channel (VGTRK´s Rossiya2) before 2015, but the channel was crappy. It was something like slovak RTVS 2 (formerly STV 2), one channel broadcasted documents, soap operas a if there was important sport event, there was sport on the channel as well. Russia had private paid sport channels/network before 2015 as well, but was not available for everyone (paid channel, you know), it was owned by Gazprom Media. Chernyshenko became Director General of Gazprom Media at the same time when he became President of KHL (Nov 2014). His role as head of Gazprom Media (in sport bussiness, because Gazprom Media owns non-sport channels as well) was to establish federal sport network by merger of federal sport channel (VGTRK) and Gazprom Media sports channels. The new network is MatchTV, it consists of MatchTV (publicly available) and paid subchannels (Match Igra etc). The change, if compared to pre 2015 era, is that MatchTV holds almost all rights for sport events and there is no bidding war for sport rights (of Bundesliga etc) in russian market.

Russian local channels, broadcasting matches of local teams, differ city/region by city/region. Therefore we have SD from some cities/clubs and great TV coverage from St.Petersburg. You know, local broadcasters make tv signal. So if you dont have experienced crew or HD equipment in the region, the coverage is bad...

Chernyshenko said that KHL´s TV rights are undervalued. They want to improve it, but it all depends on regional channels, see above.

They want to increase TV revenues by selling TV rights to new markets in Asia or expanding worldwide (especially in Europe or I guess NA). But foreign broadcasters want quality of the coverage (HD etc), what is sometimes a problem. The league wants to instal microphones to boards, but some arenas are not able to do that (too old). Dont know how expensive is to instal them.
 

ermolli

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Nov 22, 2016
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Thanks Vorky for explaination and interesting info about russian TV market and situation. So, if I understand, KHL wants turns clubs revenues from sponsorship to the revenues from TV, media, marketing etc. I red new year greetings from KHL management on the league official site, and there is something simillar (about plan to self-financing of the proffesional sport in Russia). In this point, whats about situation in China? Does KHL predict big income from TV rights in China? It is really big market, so...

About HD and SD problems... today I watch Ak Bars - Magnitka, it was SD. This big club with good arena like Kazan and only SD, its strange. And today was any problems with transmission from Minsk vs CSKA. On the KHL TV was this game cca. 5 minutes before start in the menu, so I pay stream, but nothing... and then, cca. 10 minutes after game start, this game missed from stream menu :laugh: but OK, it is only cca. 1,5 euro, so... but its not very professional, because I think, it was one of the best today games...
 

vorky

@vorkywh24
Jan 23, 2010
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Thanks Vorky for explaination and interesting info about russian TV market and situation. So, if I understand, KHL wants turns clubs revenues from sponsorship to the revenues from TV, media, marketing etc. I red new year greetings from KHL management on the league official site, and there is something simillar (about plan to self-financing of the proffesional sport in Russia). In this point, whats about situation in China? Does KHL predict big income from TV rights in China? It is really big market, so...

About HD and SD problems... today I watch Ak Bars - Magnitka, it was SD. This big club with good arena like Kazan and only SD, its strange. And today was any problems with transmission from Minsk vs CSKA. On the KHL TV was this game cca. 5 minutes before start in the menu, so I pay stream, but nothing... and then, cca. 10 minutes after game start, this game missed from stream menu :laugh: but OK, it is only cca. 1,5 euro, so... but its not very professional, because I think, it was one of the best today games...

Kazan and SD - I heard that the club wants "someone" to buy HD equipment for them, but club´s owner (Tatneft) does not want to pay ALL costs (too expensive) and local TV can not afford it. So we have a problem here. For example SKA partially financed HD equipment for StPete local channel a few years ago. Russian regional broadcasters can not afford to buy HD equipment, clubs dont have money. Plus HD equipment is not use regularly during a year, so buying it for 30 KHL games per year is waste of money. MatchTV brings their HD equipment for matches (especially in Moscow), which are broadcasted by MatchTV. There was HD match from Kazan (vs SKA) at the end of last year, but it was broadcasted by MatchTV, so they brought their equipment. Not the case of today match you were watching. MatchTV has equipment which was bought for Sochi Games 2014, btw. Chernyshenko was head of Sochi Games Committee as well :D Russian regional TV matket should develop because the state is buying equipment for FIFA World Cup 2018, which will stay in regions after FIFA WC.

China and their market for KHL - dont know how big TV income they predict from China, but it is key market for them (if all goes according to plan/hopes), but there is not hockey culture in China. Gazprom Media, so Chernyshenko, has good contacts with chinese state broadcasters. It is about exchaning of tv shows/products among both countries. I am sure they have spoken about KHL as well. As I know Chinese CCTV refused to broadcast some Kunlun´s away game at the beginning of the season, because it was in SD.... so.

Bussiness model for KHL and their clubs - all will be written in new KHL strategy. The key part of the strategy will be dedicated to financial model of the league and their clubs. Russian President ordered russian sport clubs to be less dependant on state/local money. As you said self-financing of the profesional sport in Russia. Now KHL´s clubs and league depend on sponsorhip deals (state/local goverments money), 70-90% of club budget. The league wants to change it, increasing of TV income is one way how to achieve it. KHL´s income is like following: 49% sponsorship deals (Coca Cola, Mastercard, Rostelecom etc), 26% TV contracts, 10% KHL TV channels, 6% payments of clubs, 9% others. TV contracts share has increased by 10 points since Chernyshenko came to the league. KHL did not share money with clubs under Medvedev, Chernyshenko changed it. The league shared 114M rubles for 14/15 season, 243M rubles for 15/16 and plans to share at least 243M rubles for current season. Yes, it is not enough, but still better than under Medvedev.
 

ermolli

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Nov 22, 2016
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Of course, I am wrong about sport financial and bussines system but small idea: KHL have cca. 200 millions people market (for TV rights, merchandising etc) except China. So if KHL find for example 10 mil. people from this market to follow league and pay 1 euro per month (TV, streams etc.), its 80 mil. euros for season and its 2,7 mil. euro for one club per season. If KHL find on this market 10 mil. people to pay 2 euros per month for league, result is over 5 mil. euro for one club per season. And this money is solution for poor clubs like Slovan to stay and play league.

I know, this is real naive view, but generally this is basic for self-financing sport bussines IMO.
 

vorky

@vorkywh24
Jan 23, 2010
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Of course, I am wrong about sport financial and bussines system but small idea: KHL have cca. 200 millions people market (for TV rights, merchandising etc) except China. So if KHL find for example 10 mil. people from this market to follow league and pay 1 euro per month (TV, streams etc.), its 80 mil. euros for season and its 2,7 mil. euro for one club per season. If KHL find on this market 10 mil. people to pay 2 euros per month for league, result is over 5 mil. euro for one club per season. And this money is solution for poor clubs like Slovan to stay and play league.

I know, this is real naive view, but generally this is basic for self-financing sport bussines IMO.

Yeah. KHL has helped the clubs to develop merchendising as one way of income under Chernyshenko era. As you know, clubs could not use KHL logo at their merchendising in Medvedev era. The league did not sell clubs merchendising in league´s eshop (and partner companies/manufacturers network). Chernyshenko changed it, KHL signed contracts with over 10 manufacturers (dont remember exact number) who produce KHL and clubs merchendising, new products are added all the time. Income is somehow shared with clubs. Clubs have developed their own eshops.

The problem of KHL market, as you described it, is that Russians (and I would say fans in Central Europe) are not used to buy club´s merchendising (t-shirts, jerseys etc), so clubs have to "teach" them to do so. Americans and Canadians are another story.

Merchendising is related to club´s activity in social media - more fans (on social media for example), more possible customers of club´s merchendising. I have followed club´s social media since start of the season. There is relatively big increase of fans on Twitter and VKontakte (btw Slovan has new, looks like official, account on VK since december). Facebook is not so popular. Especially Sibir and SY Ufa have increased their fanbase on social media this season.

Does anybody know when Wingas became partner of Dinamo Riga? Was it during current season like in Slovan case?
 

malkinfan

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Aug 20, 2006
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Vorky interesting comments, thanks for sharing. I think way to get into new markets doesnt need to be through TV channel where people have to pay. Even here in NA no one buys cable packages anymore, almost everything, movies, shows, sports are done online. Heck even NFL has tried a free mass broadcast of live games from Twitter.

KHL should focus on cleaning up there gamecenter streaming service. I live in NA nad have bought several games. They can access any audience in the world through this, they just need to advertise to people so people know to watch. If they had advertisement with TSN, for example to watch KHL game of the week, broadcasted in English, HD, many people would watch if there were names they knew (Kovalchuk, Datsyuk, even now guy like Kaprizov is now a god among Wild fans). Only time I dont pay in when Laola streams for free, because the quality of the streams are very high. IMO this is a good way for the KHL to lose money unless they are getting some big money from Laola.

To sum up I think KHL biggest problem is marketing, no known analysts with KHL experience who speak English on major sports networks. They need to have this, maybe go on TSN bardown KHL weekly update talak show etc. They need to clean up there record since only Englsh articles hitting NA are negative. I just dont think they reach out enough to NA which has a significant impact on the hockey world in general.
 

hansomreiste

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Sep 23, 2015
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Only time I dont pay in when Laola streams for free, because the quality of the streams are very high. IMO this is a good way for the KHL to lose money unless they are getting some big money from Laola.

I have to disagree on this one. Free streams at high quality as laola1.tv provides is a good way for KHL to make a name. Not many fans would be suddenly eager to pay KHL when they don't even have an idea what it is. Moreover, KHL is still too Russian I'd say, which makes it difficult for non-Russians to navigate around the website and purchase games. Moreover, KHL webcast is still not stable. Including me, many people are unable to watch games through official KHL video - it has been years and I still have no idea what causes it. Different connections, different PC's, different places... I saw people who can't get it working with 100Mbit internet speed. Something is broken with this thing, I don't know. For me, it is the only thing that doesn't work. I regularly watch games on laola1.tv or NHL.tv with great quality. No problems at all. Many other platforms as well. KHL's official webcast though... Never works properly.

Streaming some games on laola1.tv won't make KHL lose money. On the contrary, it will generate interest. People will know that they can follow the league to some extent without even having to pay and once they grow fond of KHL (like me) they will look for better options. They will ask for commentators. They will ask for games of their favorite teams. For example, I'm a Traktor & Avangard fan and I can rarely get to watch them on laola1.tv and I'd be more than happy to pay some money to watch them if I had a proper, legal streaming site. Without laola1.tv, I admit that I wouldn't be so much interested in KHL. For example, if watching SHL or Liiga was easier then they would be my priority.

One thing is for sure: KHL needs a better streaming service which actually works. If it was easily accessible and convenient, I wouldn't even bother checking laola1.tv to see which game they stream: KHL games are REALLY cheap unless you are paid in bottle caps. But without a proper streaming service and removal of laola1.tv from options... It's kinda impossible to watch KHL.
 

vorky

@vorkywh24
Jan 23, 2010
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KHL webcast service was created in 2012. Dont know if they want to upgrade it in near future. Try to email to KHL, describe the problem, they wont reply you but would know about the problem.
 

vorky

@vorkywh24
Jan 23, 2010
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@malkinfan


KHL & online - KHL invests only 5% of league´s budget for developing of internet projects. On the other hand KHL leadership knows that future is in digital, therefore they work with social media. I guess the league thinks that TV revenues prevails over revenues from gamecenter. As I wrote earlier, Russian are not used to pay for hockey.

Agree with TSN part. But is TSN interested in? As I know they negotiated with TSN in lockout season 2012/13. Dont remember if they reached the deal and TSN really broadcasted the KHL that season. I can imagine that TSN was not satisfied with quality of broadcasting back in 12/13, it was worse than now.

NA hockey journalists - I wrote like slovak/czech journalists work in other thread. I can imagine NA journalists are the same. Their main job is covering NHL. They are not interested in KHL, they know only what players were drafted by NHL. Their source of KHL informations are english twitter feeds of Malamud, Kalnins and maybe others who dislike KHL. I try to tweet neutral informations about KHL but my reach is small. Maybe we can create some english KHL related website? :D :D :D I know only one NA jounalist who likes KHL - Alex Pouliot-Roberge from RDS, but it is in french not english.
 
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vorky

@vorkywh24
Jan 23, 2010
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We were speaking about chinese market for KHL. I have just found an article from World Hockey Forum saying that

Sport industry in China is worth 60B USD (1/7 of US sport industry) now. China plans to reach 730B USD (1,5x more than US) by 2025.

It was said by some chinese scholar at Forum. If he is right, then wow. Problem is that Chinese are not winter sports fans....
 

Rigafan

Registered User
Jul 28, 2016
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source of KHL informations are english twitter feeds of Malamud, Kalnins and maybe others who dislike KHL. I try to tweet neutral informations about KHL but my reach is small. Maybe we can create some english KHL related website? :D :D :D

Would be a nice idea!
 

Acallabeth

Heart ablaze
Jul 30, 2011
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Making a KHL-sponsored stand-alone blog would be an option (I'm definitely not participating in anything like that for free, I don't have enough time).
 

ermolli

Registered User
Nov 22, 2016
75
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Would be a nice idea!

Yes! Yes! It is really missing. There are a lot of info in russian media about KHL I supposed, but there is translation problem (for example me, if I watch game I understand maybe 60 percent russian commentary, but reading is something absolutely different and it is really difficult).

I think, KHL need "soft diplomacy" in the Europe. It is very efficiency way for public opinion and than for media. Hockey in this league is pretty good and blog or something, can be enthusiastic and very friendly way for KHL popularization.

I like advanced stats, so I can make any diagrams, charts, statistics analysis etc :yo:
 

hansomreiste

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Sep 23, 2015
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That would be fantastic, indeed. While I am not in a position to promise for contribution at the moment due to school & job commitments, I would be happy to help in any way I can. Currently, I am at preparatory class for Russian Language & Literature at university, so starting from next year I think I would be able to help with translations from Russian and such. Though I don't think anyone would sponsor such an idea - if done, it would have to be a volunteer project.
 
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vorky

@vorkywh24
Jan 23, 2010
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Hankook Tire (S.Korea), Ernst & Young (GB), Lutch (US) and Bauer (Canada/US) among partners of KHLAllStar 2017 in Ufa.

I am not suprised that Lutch and Bauer are among partners, both companies has been involved as equipment suppliers for upcoming KHL ASG. Hankook and EY are new partners of KHL. As I know chinese Haier was partner of previous KHL ASG and stayed with league for next "full season" (current one).
 

Acallabeth

Heart ablaze
Jul 30, 2011
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Hankook has a large sponsorship portfolio, I don't think them starting a partnership with the K as well means that. The again, the league authorities have repeatedly said that they are interested in a Korean Team too.

Also, Kuznya management will meet the city authorities next week to discuss and possibly make the decision on team's future (link).
 
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ermolli

Registered User
Nov 22, 2016
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Bratislava - Engerau
Also, Kuznya management will meet the city authorities next week to discuss and possibly make the decision on team's future (link).

I red article discussion also, and this is funny: "Razognat i zakrit etot kolchoz" :laugh:

Ok, fans in the discussion expects Kuznya move to the VHL. So, 28 teams in the next season? Or Medvescak wil be the next one?
 

Acallabeth

Heart ablaze
Jul 30, 2011
9,934
1,233
Moscow
To lighten up a bit, here's a little report from a recent KHL-Bauer event and a photo gallery with a million of stupid watermarks. I wish the K and Bauer promoted the first of their "master class" series taking place in Moscow parks more. Had no idea that would happen, nice idea though. Let's all show up so Bauer thinks it's a great partnership.
 

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