League revenues increase to about $2.33B in '06-07

Fugu

Guest
Then how did the NHL get from $732 million in revenue in 1993-94 to $2.2 billion or so this past season? (Hint: it sure as hell wasn't due to TV money.)


More teams and more games? :sarcasm:



Hmm ... I'm going to guess that Atlanta also saw revenues increase due to making the playoffs. Phoenix probably didn't, but [I'll throw this one in for free] Carolina clearly did, and that's before factoring in the revenue they got from Stanley Cup merchandise. And again, none of those increases had anything to do with TV money.

Next?

Yet the number of teams making the playoffs each year is fixed, and so is the number per round.... any conclusions to be drawn from that observation?
 

bleed_oil

Registered User
Aug 16, 2005
3,898
40
For someone who loves the "reality shock", you sure play fast and loose with the "truth".

I did'nt realize I needed to play "fast and loose" with the truth. The numbers do the takling for me. Look at the playoff TV ratings for some of these Southern US markets, that says it all. Some of you internet jockeys are so caught up in your own world, you dont have a dose of reality. You dont understand what a joke the NHL is to the world at large in part of the US.
Theres probably a message board out there somewhere where WNBA fans talk about how there sport is ready to brekthrough the mainstream and how financially strong it is....
 

mooseOAK*

Guest
no offense man, but 3 additional rinks in 14 years is hardly what I would call exponential growth. Good to hear things are working out where you're at though

I do know that the population of the city has not quadrupled in 14 years.

Hockey players in the Dallas area have increased from 500 to 4000 in those same 14 years.

That's the truth but somehow I get the feeling that you are having none of it.
 

Bear of Bad News

Your Third or Fourth Favorite HFBoards Admin
Sep 27, 2005
13,361
26,528
I did'nt realize I needed to play "fast and loose" with the truth. The numbers do the takling for me.

And you honestly don't think numbers are spun in order to produce a desired opinion? Including by you.
 

Hawker14

Registered User
Oct 27, 2004
3,084
0
It's amazing how:

- A positive thread with GOOD news about the NHL is somehow made out to be a bad thing...but only for certain markets.
- No matter who else it's bad for, it's a good sign for Winnipeg.
- All the Winnipeg boosters seem to be the same person, playing bad cop/good cop.

:huh:

-the top 12 markets in the league are driving the increases - 6 strong Canadian and 6 strong American markets.

-half of all the American teams are receiving revenue sharing - 12 of 24 - wow ! Apologists like to bring up the fact that Edmonton, Calgary and Ottawa received currency equalization payments when the Cdn dollar was low, but what's the excuse for the 12 US teams currently receiving revenue sharing - Is the US dollar now worth .65 cents Cdn ?

-yes, blame winnipeg for the failed efforts of Bettman to execute the owners' mandate to secure a major national TV deal in the US.
 
Last edited:

MAROONSRoad

f/k/a Ghost
Feb 24, 2007
4,067
0
Maroons Rd.
I think it is good news for the NHL, but I'm still curious how much of the NHL's apparent revenue growth in the last five years or so can be simply attributed to the fact that the Canadian dollar has risen almost 30 cents from a historic low of 61 cents in January 2002 to 91 cents today. If one third of the league's revenue is now sourced in Canada as recently reported, a major shift in the exchange rate must have a big impact. Any number crunchers out there?

GHOST
 

kdb209

Registered User
Jan 26, 2005
14,870
6
Irish Blues said:
Then how did the NHL get from $732 million in revenue in 1993-94 to $2.2 billion or so this past season? (Hint: it sure as hell wasn't due to TV money.)
More teams and more games? :sarcasm:
And of course, newer (and bigger) arenas:

HP Pavilion (1993) - 17,400
United Center (1994) - 20,100
ScottTrade Center (1994) - 19,000
GM Place (1995) - 18,600
TD Banknorth Garden (1995) - 17,600
Scotiabank Place (1996) - 19,100
Bell Center (1996) - 21,200
HSBC Arena (1996) - 18,700
Wachovia Center (1996) - 19,500
Verizon Center (1997) - 19,200
BankAtlantic Center (1998) - 19,250
Pepsi center (1999) - 18,000
Air Canada Center (1999) - 18,800
Staples Center (1999) - 18,100
America Airlines Center (2001) - 18,500
Jobing.com Arena (2003) - 17,800
 

Ted Hoffman

The other Rick Zombo
Dec 15, 2002
28,859
8,113
Every item you list above for revenue growth is predicated on general interst. Why would a corporation in say... Atlanta, sponser a team who gets 8,800 viewers tuning into a game. Do you think for some reason that companies like to throw away money into a black hole? Merchandise? Again, predicated on public interest.
:rolleyes: Here we go again with this idea that what Nielsen says is really an accurate estimate, and I've already poked holes in this idea. Granted, we have no other source to use b/c Nielsen has a monopoly on providing ratings ... but there's sufficient reason to believe that ratings for hockey are underreported from what they really are.

As for point 3 above, I think tv ratings clearly show that the NHL is NOT a major sport like MLB, NBA or NFL in the US. So why should your assumption hold?
Why should yours - because the NHL isn't the other 3 sports? Hockey has NEVER relied upon TV revenue as a major source of revenue for paying the bills - so again ... it's irrelevant to keep going back and pointing at it and drawing some conclusion from it.

IMO indefinite ticket prices increases will see resistance at some point from the public in this situation when you lack a market that appeals to a broad base you are asking for trouble.
Sure ... let's make a bet on what revenues will be in '07-08. The loser pays $100 to the charity of the winner's choice.

I guarantee I'm a hell of a lot closer with my guess than you will be with yours, unless you open up your eyes to the fact that TV revenue is a figurative drop in the bucket for most teams and isn't even 20% of overall revenues for any team that has a huge (read: more than $10 million per year) contract currently on the books, with the possible exception of the Islanders (whose contract is locked in until something like 2030 - meaning it's a guaranteed stream of revenue for the next 20+ years).

Plus, you fail to realize that there has never been any meaningful correlation between league revenues and TV ratings for the NHL. Never.

-half of all the American teams are receiving revenue sharing - 12 of 24 - wow ! Apologists like to bring up the fact that Edmonton, Calgary and Ottawa received currency equalization payments when the Cdn dollar was low, but what's the excuse for the 12 US teams currently receiving revenue sharing - Is the US dollar now worth .65 cents Cdn ?
Please cite your source claiming that 12 US teams are currently receiving revenue sharing - I thought we said it was 10 the last time we covered this. (deleted - after further thought, I'll concede this point since I get what hawker is implying).

I think it is good news for the NHL, but I'm still curious how much of the NHL's apparent revenue growth in the last five years or so can be simply attributed to the fact that the Canadian dollar has risen almost 30 cents from a historic low of 61 cents in January 2002 to 91 cents today. If one third of the league's revenue is now sourced in Canada as recently reported, a major shift in the exchange rate must have a big impact. Any number crunchers out there?
Does anyone have a list of revenues by team each year from 2001-02 to use as a starting point? (Note: the Leavitt report isn't sufficient; the Forbes list might have to suffice unless anyone thinks it's biased one way or another - and even then, people who cite bias may have to deal with it in the absence of anything more definitive.) Then, does anyone have a list of average ticket prices by year from 2001-02 to now?

This would be doable ... but it's going to be tough to get the necessary data.
 
Last edited:

Valhoun*

Guest
You want more revenue?

Do what the Chiefs did.

Two words: Fashion Show.
 

RangerBoy

Dolan sucks!!!
Mar 3, 2002
44,912
21,238
New York
www.youtube.com
Gary Bettman was a guest on Hockey Central with Darren Dreger and Nick Kypreos today.They asked Bettman about the cap.Bettman said all of the final numbers have not been crunched but he sees the cap increasing by 6-7% would which reflect the same % increase in revenue.$46.64-$47.08 million
 

Sotnos

Registered User
Jul 8, 2002
10,885
1
Not here
www.boltprospects.com
-the top 12 markets in the league are driving the increases - 6 strong Canadian and 6 strong American markets.

-half of all the American teams are receiving revenue sharing - 12 of 24 - wow ! Apologists like to bring up the fact that Edmonton, Calgary and Ottawa received currency equalization payments when the Cdn dollar was low, but what's the excuse for the 12 US teams currently receiving revenue sharing - Is the US dollar now worth .65 cents Cdn ?

-yes, blame winnipeg for the failed efforts of Bettman to execute the owners' mandate to secure a major national TV deal in the US.
Were you trying to dispute anything I said?
 

Jester

Registered User
Jul 9, 2004
34,076
11
St. Andrews
-the top 12 markets in the league are driving the increases - 6 strong Canadian and 6 strong American markets.

-half of all the American teams are receiving revenue sharing - 12 of 24 - wow ! Apologists like to bring up the fact that Edmonton, Calgary and Ottawa received currency equalization payments when the Cdn dollar was low, but what's the excuse for the 12 US teams currently receiving revenue sharing - Is the US dollar now worth .65 cents Cdn ?

-yes, blame winnipeg for the failed efforts of Bettman to execute the owners' mandate to secure a major national TV deal in the US.

Metro Population
Philadelphia - 5.8M
NYC - 18.8M
Detroit - 4.5M
LA - 12.9M


Phoenix - 3.9M
Tampa Bay - 2.7M
Raleigh - 914K

etc.

Not every city is created equal... pair that with the fact that hockey isn't nearly as popular in some cities than others, and you're beginning to see why there is a very real difference in the income of teams. The revenue from advertising and everything else in a larger metro area is always going to be a strength that the clubs in those cities have, that teams in smaller markets can't compete with... Some of it is on ownership, but the need for salary caps and revenue sharing are due to this aspect of the business more than anything else.

Baseball's lack of dealing with this issue is one of the reasons MLB is a joke.
 

Fugu

Guest
I think it is good news for the NHL, but I'm still curious how much of the NHL's apparent revenue growth in the last five years or so can be simply attributed to the fact that the Canadian dollar has risen almost 30 cents from a historic low of 61 cents in January 2002 to 91 cents today. If one third of the league's revenue is now sourced in Canada as recently reported, a major shift in the exchange rate must have a big impact. Any number crunchers out there?

GHOST

I think to get in the ballpark, GHOST, you'd have to use the estimated revenues for each team (say Andrew's Dallas Stars page), and then get the annual Canadian $ to USD official rate (Bank of Canada) for a given year and adjust. I believe the NHL uses the official rate for a given year, closing in June or July (Carpenter can correct me).

Of course, this is just an estimate. How and when teams exchange funds and the rates they get may vary from the single annual rate used to report league-wide revenues. There was a good discussion on the effects of the exchange rate - and some good guesses from some folks - in Tom Benjamin's blog a few months back. You might recognize some of the participants here in that discussion-- if you can find it. :)
 

MoMiester

Registered User
Oct 26, 2006
90
0
The point was that the league had no where to go but up. $2.2 bil is peanuts compared to the other major sports. And who is 'giving away' tickets? My season tickets went up a full 50% from last season to this upcomong one. That means from $2,580 to $3,870 for two seats. And the demand is such that they are on the verge of cutting off taking orders for full season ticket plans and only offering partial and individual seating in very sucky areas.


Demand for Penguins' season tickets leads to changes
Some fans lose seat, others take upgrade

Tuesday, May 15, 2007

By Shelly Anderson, Pittsburgh Post-Gazette

A silent seat shuffle at Mellon Arena has sparked mixed emotions among the Penguins and their fans.

Many of those with partial-season ticket plans are being asked to move or upgrade, creating some discontent. The Penguins aren't thrilled about upsetting some of their fan base, but they are pleasantly surprised at the reason for the changes.

"Full-season ticket sales are up 60 percent over this past season," Penguins vice president of communications Tom McMillan said. "We haven't seen anything like this since the [Stanley] Cup years. We anticipated a spike. We didn't know it would be anything like this."


http://www.post-gazette.com/pg/07135/786083-61.stm

I certainly wish they were giving away the tickets, but I can report sadly that is not the case.

And even with this growth the NHL has huge room to grow, as I said, compared to the other major sports. There will be years that are steps backward, but I am pretty confident that overall the trend will be steadily up.

It is amazing. people alwayscomplain about free tickets or arenas not selling out , but I always wonder if those people have ever had to shell out actual money for season tickets. I just paid for a package and it was not cheap.

The only thing worse is when people say "When they put a team in my city I am getting season tickets" , when I wonder if they have $20 bucks in the bank.
 

MoMiester

Registered User
Oct 26, 2006
90
0
-

-half of all the American teams are receiving revenue sharing - 12 of 24 - wow ! Apologists like to bring up the fact that Edmonton, Calgary and Ottawa received currency equalization payments when the Cdn dollar was low, but what's the excuse for the 12 US teams currently receiving revenue sharing - Is the US dollar now worth .65 cents Cdn ?

-yes, blame winnipeg for the failed efforts of Bettman to execute the owners' mandate to secure a major national TV deal in the US.


Hawker, be careful. Winnipeg getting a team is based on revenue sharing. Without it, Winnipeg does not stand a chance. Your own people say it is at $7M a year !!! So a new team in Winnipeg would be on the dole from Day 1 !!!!

Not sure I would be going after teams and rev sharing since your new Jets would be sucking on that *** for life......."dear life"
 

Enstrom39

Registered User
Apr 1, 2006
2,174
0
www.birdwatchersanonymous.com
Every item you list above for revenue growth is predicated on general interst. Why would a corporation in say... Atlanta, sponser a team who gets 8,800 viewers tuning into a game. Do you think for some reason that companies like to throw away money into a black hole? Merchandise? Again, predicated on public interest.

As for point 3 above, I think tv ratings clearly show that the NHL is NOT a major sport like MLB, NBA or NFL in the US. So why should your assumption hold?
IMO indefinite ticket prices increases will see resistance at some point from the public in this situation when you lack a market that appeals to a broad base you are asking for trouble.
Next?

Major corporate sponsors become "partners" with the NHL in Atlanta. They pay a sum and get advertising on TV, in arena advertising, program advertising and blocks of seats/suites inside the building they can use for entertaing promotions.

While you seem to be completely obsessed with the ratings for one particular game (you fail to mention that the NBC Atlanta playoff game drew 50,000 viewers in ATL) the reason why sponors continue to pony up big money to become corporate sponsors is that hockey in ATL appeals to an upper income segment of the local population. Many of the sponsors sell items like luxery cars (Volvo, BMW, Hummer are all local sponsors) or Homes (KB Homes) home repair stuff (Home Depot) or travel (Delta Airlines).

If you are a company that sells products to people who have money then advertising at Thrashers games make a lot of sense, because people with money attend Thrashers games--even if they are getting in for free because they got tickets to a luxery box or suite for the night. Those eyeballs are the ones you want to reach because those eyeballs are the ones who have the potential to buy your product.

Now would the Thrashers love to have TV ratings and attendance numbers go higher absolutely yes. But as I stated in another thread a while back the Atlanta Thrashers can survive and flourish even if only a fraction of the local population cares about hockey. I know this burns you up but the Atlanta metro area is five times the size of Edmonton and the local economy is five times that of Edmonton's. The Thrashers don't need anywhere close to the level of devotion that EDM needs to survive because of the size of the market.

Dallas and Tampa are good points of comparison. Hockey will likely never be the #1 sport in DAL or TB but that doesn't mean that hockey can't be profitable in those cities.
 

Big#D

__________________
Oct 11, 2005
2,779
0
I think it is good news for the NHL, but I'm still curious how much of the NHL's apparent revenue growth in the last five years or so can be simply attributed to the fact that the Canadian dollar has risen almost 30 cents from a historic low of 61 cents in January 2002 to 91 cents today. If one third of the league's revenue is now sourced in Canada as recently reported, a major shift in the exchange rate must have a big impact. Any number crunchers out there?

Just a quick cruch of those numbers:
The league has revenues of approx $2.2B (USD) for this current season according to the OP. In an article by the Star (http://www.thestar.com/article/180345) in February, it mentions that the 6 Cdn teams made up 1/3 of league revenues or approximately $700M to $750M (USD). Using $700M, the numbers break down as follows:

At a rate of 91 US cents to every Canadian Dollar, that would represent approximately $770M CAD (700 / 0.91).
If those $770M CAD were exchanged at 0.61 instead of 0.91, Canadian team revenues in USD would be $470M.
Total league revenues would be $470M from Canadian teams and $1.5B from US teams ($2.2B - $700M) for a total of $1.97B.
Canadian team revenues would account for 24% of the total ($470M/$1.97B) revenue.

Please note that the numbers are very rough. They don't take into consideration the timing of the revenues vs the exchange rate (i.e. they assume exchange rates are consistent).
Note:
USD = U.S. dollar
CAD = Canadian dollar
 

GSC2k2*

Guest
Just a quick cruch of those numbers:
The league has revenues of approx $2.2B (USD) for this current season according to the OP. In an article by the Star (http://www.thestar.com/article/180345) in February, it mentions that the 6 Cdn teams made up 1/3 of league revenues or approximately $700M to $750M (USD). Using $700M, the numbers break down as follows:

At a rate of 91 US cents to every Canadian Dollar, that would represent approximately $770M CAD (700 / 0.91).
If those $770M CAD were exchanged at 0.61 instead of 0.91, Canadian team revenues in USD would be $470M.
Total league revenues would be $470M from Canadian teams and $1.5B from US teams ($2.2B - $700M) for a total of $1.97B.
Canadian team revenues would account for 24% of the total ($470M/$1.97B) revenue.

Please note that the numbers are very rough. They don't take into consideration the timing of the revenues vs the exchange rate (i.e. they assume exchange rates are consistent).
Note:
USD = U.S. dollar
CAD = Canadian dollar
That crunch, while very helpful, would need a lot of refinement, of course. While the Cdn$ is 91 cents today, that is not the relevant number for purposes of calculating the NHL's revenue for this season.

Without taking into account my well-documented exceptions to the 1/3 figure provided by the Star (see other threads), if one were to accept that number, every penny difference is worth several millions of dollars.
 

mouser

Business of Hockey
Jul 13, 2006
29,285
12,586
South Mountain
That crunch, while very helpful, would need a lot of refinement, of course. While the Cdn$ is 91 cents today, that is not the relevant number for purposes of calculating the NHL's revenue for this season.

Without taking into account my well-documented exceptions to the 1/3 figure provided by the Star (see other threads), if one were to accept that number, every penny difference is worth several millions of dollars.

Not quite sure exactly what is being argued here, but...

It would probably be fair to use 87 cents as the average for the season. The monthly moving average was 86.5 from Oct 06 through Mar 07, however it was slightly higher in both Sep 06 and Apr 07. Usually public companies actually recognize pre-paid service revenue when the service is delivered, however the exchange rates would still apply to the date the money was received. Understanding that the Canadian teams are not public companies and have some leeway in accounting treatment, I think it likely a disproportionate portion of revenue was recorded for season tickets in Aug/Sep/Oct 06 when the rate was 88.6 to 89.6 cents.
 

Fugu

Guest
Midpoint = (Preliminary HRR Revenues * Players Share - Preliminary Benefits) / 30 teams


If revenues hit $2.2 billion and assuming preliminary benefits grew at 5%, the players would get 55% and the midpoint would be about $38.4 million - giving us an Upper Limit of $46.4 million. If revenues hit $2.25 billion, then the players share would be 55.25% and the midpoint would be about $39.55 million - giving us an Upper Limit of $47.55 million. If the 5% adjustment is not waived this year, then the Midpoint would move to about $41.5 million, and the Upper Limit would stand at about $49.5 million.

So for everyone that's asking - if both sides don't waive the 5% adjustment factor, we're probably looking at a $49.5 million cap; if they waive it again this year, we're probably looking at a $47.5 million cap.


How does $2.36 billion, plus the 5% bump sound. That takes the revenue used to calculate the cap to ~$2.478 billion, meaning the players share is 56%, and the cap is $52 MM! :amazed:

Larry Brooks has an interesting tidbit about the NHLPA's review of the cap for next season:



Slap Shots has been told that the NHLPA is planning to exercise its right under the CBA to request that a full five-percent bump be built into next season's cap. If 2006-07 league revenues come it at $2.36B - Gary Bettman on Monday said he thought the number would be close to $2.4B - a five-percent bump would bring next season's upper limit to approximately $52M.

We've learned that the PA was urged to push the cap as high as possible by, among others, Major League Baseball PA executive director Don Fehr and former NBA union head Charles Grantham during a meeting in Toronto last Monday with members of the NHLPA's current leadership group.

With revenues growing by between 7-and-10 percent - Thank You Fans for Paying Higher Ticket Prices, will be the message inscribed into the ice next year - there is no reason whatsoever for the players not to insist the cap be raised to its legal limit; not one.

Whatever people here think of Brooks' and his opinions, keep in mind that the numbers are easy to calculate if indeed Bettman said revenues will be close to $2.4 billion, and if the players take the advice of the player association head from the MLB and ex-head of the NBA. I found that part the most interesting thing about this article.... so the I bolded it for emphasis.
 

Ted Hoffman

The other Rick Zombo
Dec 15, 2002
28,859
8,113
Indeed, that is interesting. Of course, Fehr and Grantham don't have an escrow system in place so they're seeing, "don't leave a penny on the table" in all of this.

Even more interesting: if the cap goes to $50 million, how do teams like Edmonton respond given their comments about how a higher cap is not good for them?

However ... this raises a good question - if revenues are indeed near $2.36B, do the owners have to pay out to the players again? I honestly don't have a feel for this (I'm tracking salaries b/c some people are interested in it, but I'm much more concerned with cap numbers since that's the limiting factor in building a team when all is said and done) but at that level, it's looking like the players are going to get much of their escrow back.
 

GSC2k2*

Guest
How does $2.36 billion, plus the 5% bump sound. That takes the revenue used to calculate the cap to ~$2.478 billion, meaning the players share is 56%, and the cap is $52 MM! :amazed:

Larry Brooks has an interesting tidbit about the NHLPA's review of the cap for next season:





Whatever people here think of Brooks' and his opinions, keep in mind that the numbers are easy to calculate if indeed Bettman said revenues will be close to $2.4 billion, and if the players take the advice of the player association head from the MLB and ex-head of the NBA. I found that part the most interesting thing about this article.... so the I bolded it for emphasis.

For starters, I would certainly query why the NHLPA would be meeting with Charles Grantham, who is not even a union figure any more (unless they are interviewing him?!:naughty: Hey I think I just wrote Brooks' next column!!). Even so, he would be being very disloyal to his ex-constituency, given the NHL/NBA ownership crossover.

BTW, Grantham would be a very sound candidate as head of the NHLPA, were he to throw his hat in the ring.

Secondly, Bettman has stated at least 4 or 5 times in public (and Daly once or twice) that revenues rose 6 to 7 percent. A month or so ago, it was 5-7 percent, then more recently, 6 to 7 (as more playoff revenue comes in and the range gets tighter. As such, Brooks' 7-10 percent statement damages his credibility (again).

The players' share would actually be a shade under 56%. The 5% is used to calculate the cap, but it does not affect the players' share, which is what it is at the end of every season based on actual revenues.

Of course, the half-wit Brooks either does not appreciate that there is in fact a quite reasonable position for not raising the cap by 5% or he does and is being disingenuous. I don't think i have to articulate that reason for the august minds here in this thread.

By the way, IB, I believe Grantham did have an escrow system in place when he was head of the NHLPA.
 

thinkwild

Veni Vidi Toga
Jul 29, 2003
10,815
1,468
Ottawa
To what is this revenue growth most likely attributable to?

Is this just normal growth that continues as always?
Is it largely the effect of the Canadian dollar?
Is it because expenses were capped and 30 equal teams increased attendance?

If revenues grow 6-10% again, (wasn't 7.5% the growth factor Goodenow wanted to use?) and it is expected to continue again the next year, then it would seem pushing the cap to the max works best for the players? Only if revenues are dropping or stabilizing would you worry about escrow not returning?
 

Ad

Upcoming events

Ad

Ad

-->