Phoenix LXXII: Send in the Clowns
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02-19-2013, 01:36 PM
Join Date: Nov 2005
Originally Posted by
I think it's great that they are selling out now. Great for the team, fans, and media to see a full house.
HOWEVER should those prices be lifted $35-$75 would the sellouts continue?
Should the purchase incentives stop would the sellouts continue?
Not to be the bearer of bad news but both would likely be answered with a firm NO. The problem isn't the lack of fans, it's the discounts and rebates and sales the fans receive. Most NHL teams could survive on 10,000 fans every night almost no problem. In Glendale however the market won't support higher prices for the luxury of being able to watch NHL live, for the simple reason that they have become too accustomed to the current pricing for 15 years.
Originally Posted by
I'm not sure what the business model looks like, but the Coyotes clearly need something in the range of another $20M in revenue. How they get that from the gate and related sales is beyond me. But, an average ticket price of $40 isn't going to do it, even with a string of sellouts. Prices need to average around $75 (like the Suns' tickets do), and I don't think that will happen any time soon.
That's one of the problems with the NHL business model which puts too much emphasis on the gate. MLB, NFL and NBA could never survive under that model, and teams would be relocating left and right if they were also gate driven leagues. Places like Phoenix could survive if the NHL had significant sources of revenue outside the gate. But given that isn't how the NHL operates, every team needs to be healthy and contribute to revenue or there will be pressure to relocate teams.
One doesn't need to look far to understand why increased revenue sharing was a non-starter for the NHL owners under the current CBA round of negotiations. Slight modifications yes...but nothing like how more healthy leagues address revenue sharing when they have 10X's the amount of TV revenue to start with.
You have to ask yourself, long-term, and even in healthy markets, will the NHL business model last and what future changes may make even currently stable organizations run into trouble.
Goyotes makes the point I was going to make. A major professional team in the US cannot survive on gate alone, even with average to the top end ticket pricing.
If the Leafs garner ~$2 MM per game -- and this is the best in the league -- that equates to mid $80s MM in gate. The reality is that the stronger markets are yielding $1-1.5 MM per game in gate receipts. Of course, the stronger markets then have stronger media contracts, sponsorships, and more STHs. Revenue transfer is meant normalize the revenue distribution curve--- not to make markets that lack all of the above somehow viable.
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