Can KHL ever become profitable?Does the league even want to become profitable?
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02-26-2013, 11:08 AM
Join Date: Jan 2010
Originally Posted by
Whatever form the discussion takes, and whatever the sources of revenue, its safe to say that most KHL franchises can sustain the current level of losses for a long time. It was always anticipated that those franchises that lacked the financial wherewithal might drop out somewhere down the road, but if the basic core is strong, the goal of creating a top-flight league will be sustained well into the future. Financial solvency is based on a combination of factors that go beyond mere gate receipts. There is television money, which is a huge part of the equation, and merchandizing, among others.
One of the biggest indicators of success for professional sports franchises is television viewing audience ratings. What KHL owners will look at, 8-10 years down the road, is whether the league has caught on with the public. Do viewer ratings suggest that a continously growing segment of the public is watching KHL games? Are there indications of growing rivalries based on city/regional affiliation? Are there "stars" emerging who have become fan favorities with a broad segment of traditional sports viewing? If the answers to those questions is no, then investment in the KHL will likely drop off, and the league may be in jeopardy. On the other hand, if the answer is yes in all or most cases, then investment will certainly increase, and outside sponsors will want to get in on the action.
I can agree.
I dont remember who said it, but it was someone from KHL´s HQ. When KHL started it was said that main goal of revenue is TV deals. Not money from tickets.
Why did KHL launch own tv channel? I would say to be able to produce more games live, in highest quality. Therefore we can see investments into TV equipment. That is a reason why Game center at league´s website is crappy comparing to NHL.
MONEY FROM (+ AUDIENCE)
TV deals >>>> internet streams on league´s site
Why does KHL try to conquer asian tv market? I would say to increase money from tv deals.
Why does KHL try to sell its products to US/CAN based broadcasters? NHL is no.1 here and always will be (in hockey). To get more money from tv deals, even not become no.1 in NA market.
If KHL signs more tv deals worldwide, it can lure more sponsors from all the globe (mainly from Asia). The big different among NHL and KHL is strategy. NHL gives all marketing and tv rights to club to sell them. Right? KHL is another story, league holds all tv rights (and revenue), around 70% of ads place in boards/ice. Club can market only its brand (therefore we see club´s beer etc). IMO it was good strategy in the beggining because leageu was better product that sole club. Lets say Sibir had no chance to get any tv/sponsorship money in 2008/9.. not attractive club. Now, after a few years it is possible for this club to aquire sponsorship/tv money. On the other hand, when does Sibir etc get more money? If league sell tv/sponsorship deals (and then share money) or a club? Yes, SKA would have no problem to sign a deal with big foreign companies. but what about small clubs? I believe that KHL will share revenue from tv and sponsor deals in near future. Go back to soccer example. If KHL got 1 billion USD from sponsorship/tv deals and share it with clubs, would it be enough? How much money does NHL share?
Yes, new arenas are under constrction, which is good. But I dont think that we will see increasing of tickets in near future (russian clubs). There are another more important source of money for KHL/clubs.
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