Why is this year a make-or-break year for the NHL?
I believe this article is provocative and well-written but I still am unsure of why this year is a make or break year. I would have thought the year after the lockout was the critical year to test the wellness of our league. As a reminder, the year after the lockout, the NHL had its best year EVER in terms of revenues and attendance. And with a new CBA in place, the league became very stable on a team by team basis. New rules are in place; scoring is up; competitiveness is up; and global interest in the game is up as well. Year two post lockout was even better with strong growth in revenues and great growth in values of franchises. Our salary cap is now at $50 million up from $39 million the year after the lockout. That translates into healthy growth as the players are now our partners. Teams are selling for very high valuations — all of them to date post lockout — in the $200 million plus range. (As an aside, I paid $85 million for the Washington Capitals.) Franchise value growth in the NHL is better than most high growth stocks now. Merchandise sales are up. Ticket sales are up as are average ticket prices. Sponsorship revenues are up. League revenues are up; web traffic is up; youth hockey enrollment is up. Every metric has a green arrow up but TV ratings. The NHL has always struggled with ratings on TV. I am hopeful that HD will help the game translate to TV as will new higher production values and adding an interactive overlay to all broadcasts, e.g. which line is on the ice now?; how fast is he skating?; how hard was that slapshot?; etc. However, I am unsure that any sports’ TV ratings will increase over time as TV viewing as a whole with key demographics is waning and many other sports TV ratings are challenged over time as well. Our focus as a league needs to be on developing an integrated media platform strategy. We must use television (cable, broadcast and local rights) AND the new media (broadband web, satellite radio, mobile, video and multi-user games) to create more interest and generate more revenues for the league and at the same time make our sport ubiquitous to the new generation of sports fans. Local TV ratings are strong and growing and our local rights are highly valued by cable partners. I do believe that hockey is the sport best suited to the tastes of young adults of any sport. It is fast, colorful and cool. It has music baked into its presentation. It feels like a video game and it is nonstop action. Our fans are the most wired of any sport and that augers well for the league too. Compare hockey as a sport to king football, the #1 TV sport. Watch any NFL game and time the actual amount of time of play. My bet is that in an entire game there is less than 12 minutes of actual play in an entire game which can take 3 hours to complete. Go ahead and test me on this one. Time the actual amount of play in a game, it is an amazing exercise. A NHL game has all action almost every minute of play. There are no huddles. There is no running out of bounds; no place to hide; no thirty seconds to ponder a play. We give great ROI to viewers for the time and attention. Also, in terms of local attendance, compare a local NHL team that plays 41 home games and averages 17,500 per game in attendance. That translates to 717,500 turn style clicks vs. a NFL team that plays eight home games and averages 75,000 in attendance which translates into 600,000 turn style clicks. I could also argue that there is more global interest in hockey than there is in football. How did that European league work out for the NFL? It isn
