NHL Expansion
Las Vegas and Quebec City
Which will get an NHL franchise if any?
But Seattle was also a contender I
thought would make a better candidate for the NHL,and have more
hockey fans dedicated to a team as well. But I don't think that's
going to happen.
The two front runners seem to be Quebec
City and Las Vegas. I am making a prediction that Vegas gets it
before anyone.
The first three important aspects of
expansion are—will the owners own the arena,who owns the team and
can they support it financially along with the demographics of the
city,state or province that they want to expand in. This excerpt I
took from an interview with NHL Deputy Commissioner Bill Daly who was
on Sportsnet.
There are two cities as I said; really
in the running for NHL expansion, Las Vegas and Quebec City. But ask
yourself,why aren't there any 4 major pro sports teams in the city of
Las Vegas,despite it being the
epicenter for sports betting and sports
books.
The NHL seems to think that it will
persuade sports fans to become fans of hockey and watch the NHL,when
that's far from the truth. They're looking more for market share.
They already went into a number of US based markets and faltered
money wise—like Phoenix and other markets such as
Florida,Carolina,Nashville and Columbus thinking any market is a good
hockey market,as long as the owners have mega bucks,and can get an
initial season's ticket base to satisfy the NHL governors, which
consist of the owners of the top teams in the NHL,and the NHL
executive committee.
One of the main aspects of applying to
become the owner of an NHL franchise is giving actual statistical
proof the team and business will be profitable. Not just can be. And
they have to have a long term vision for the team and the community
that actually will work. The governors will always have the final
say,not Gary Bettman or Bill Daly who are the NHL Commissioner and
Deputy Commissioner respectively.
Does Vegas And Quebec have the numbers
to actually be profitable?
Las Vegas has major tourism and
gambling,and casinos are the biggest employer in the area. And sports
is big amateur and minor pro wise,but not one of the 4 major pro
sports has an actual team in Vegas.
Now, as far as Quebec City goes, it's
hockey crazy, but doesn't necessarily have the population base to
support a team. Where as Vegas might,I said might be able to.
Gambling on hockey is a tough game handicapping wise,and NHL players
gambling in Vegas could be an issue as well as outcome of games being
influenced by sports books,or criminals.
The Canadian Dollar's Major Drop A Big
Problem For Canadian and US Teams?
One other big issue looming over all
this is the Canadian Dollar. I looked at what the Canadian dollar is
worth today. It's 74 cents US. That costs Canadian teams more to
operate and contribute less to league revenues as well. Players are
paid in US dollars for the most part,and an even bigger fee was the
team expansion fee of approximately 500 million dollars;which in
Canadian dollars is $678,210,000.00
That's 678 million 210 thousand guys.
If you're canadian like myself you're
thinking you're getting more money because of the exchange rate. You
are,but all that money has to be turned over into US dollars,which
leaves very little to play with and actually make a profit with. If
you could pay your players in Canadian dollars and make a lot of
money through other sources—such as ticket
sales,events,concessions,team merch and so on to pay for all
this,and come out ahead financially would do a lot to alleviate some
of those money woes possibly.
I didn't say being an NHL owner was a
bed of roses awash in cash.
One of the only positive's out of all
this is,Quebec City has an arena in place already,and if the did not
would result in many 100's of millions more to pay out.
This all sounds very depressing but
that's the cost of owning a major pro sports franchise even if you're
a billionaire. There is only so much money to be spread around.
Before I leave this subject,chances are
the American teams making the most will be propping up not just
Canadian teams because of the weak Canadian dollar,but further
expansion into Las Vegas or Seattle could mean further diminishing of
league revenues. Especially if major teams aren't in the black. Like
I've said in other articles I've written on league revenues,what if
there were no lucrative TV contracts?
Chances are there would not be any
expansion.
There are many variables as to whether
a market is successful in getting a team. This includes territorial
issues for Quebec. If they actually are successful,that is
Quebecor—the company which is a huge media and communications
conglomerate,in getting a team will most likely have to pay out fees
called Indemnity fees. All that is is just a fee for invading
someone's territory. That team being the Montreal Canadiens.
Th same would happen if there was
another team in the Toronto area. An indemnity fee to the Toronto
Maple Leafs of many 10's of millions. If not 100 million. I think
that competition is good. What? Has no one heard of competition?
It's done in all kinds of industry. Yet
the NHL is worried about their cash cows being slaughtered. I think
it's a form of corporate welfare.
There are many variables in applying to
become an NHL owner beyond being a billionaire. I think they'll go
into Vegas before Quebec which will take longer in the process. As
well, a market entrenched already as a hockey mecca would do
well,even if the population base is smaller and dedicated.
The NHL seems hell bent on convincing
non-hockey towns to conform to becoming NHL fans.
Both Bettman and Daly said that the
talent pool in the NHL is better than ever,but I know enough to know
if you keep on expanding you'll water down that talent pool
eventually.
NHL expansion has to be very carefully
done,because Phoenix didn't fare so well,and one of the only reasons
it's still there is the cash infusion the owners received from the
NHL to the owner Jerry Reinsdorf if I'm correct.
I love NHL hockey and grew up playing
ice hockey in a small town in Canada. Whether or not Vegas or Quebec
City gets an NHL franchise remains to be seen,and if it's profitable.
Profitability is more important than
aligning the divisions with a new franchise and having symmetry
number wise in each division,for regular season games,and playoff
rivalries. There is also the issue of revenue sharing which gets
sliced even further—and if a team loses money that negatively
impacts the whole NHL.
In the end successfully bidding and
ultimately acquiring an NHL franchise doesn't guarantee a thing.
But being in a hockey based community
that can support ticket sales and make the team and community prosper
will have a greater effect on society,and the NHL.
Would have been interesting to hear
from an actual Vegas Sports book on how viable they think the NHL in
coming to Las Vegas would be.
We'll see in the coming months.
