HFBoards

Go Back   HFBoards > General Hockey Discussion > The Business of Hockey
Mobile Hockey's Future Become a Sponsor Site Rules Support Forum vBookie Page 2
The Business of Hockey Discuss the financial and business aspects of the NHL. Topics may include the CBA, work stoppages, broadcast contracts, franchise sales, and NHL revenues.

Daly: European expansion on the horizon

Reply
 
Thread Tools
Old
09-12-2008, 11:51 AM
  #1
Hawker14
Registered User
 
Join Date: Oct 2004
Country: Canada
Posts: 3,016
vCash: 500
Daly: European expansion on the horizon

Not sure if an existing thread would've worked better, but didn't find one. Please move if there is, thanks.

http://www.tsn.ca/nhl/story/?id=2492...=secStory_main

Quote:
The Globe and Mail reports that the National Hockey League is aiming to have teams based in Europe within the next 10 years.

"As time goes on, you'll see us making increasing movement into Europe," NHL deputy commissioner Bill Daly told the newspaper. "Certainly, it's a possibility that within 10 years time we will be playing games there."
Quote:
But first we have to expand a couple more teams back into Canada, get back into Winnipeg and put another team in Ontario before we see expansion to Europe."-Jim Rutherford


Last edited by Fugu: 09-12-2008 at 12:33 PM.
Hawker14 is offline   Reply With Quote
Old
09-12-2008, 11:56 AM
  #2
Fugu
Guest
 
Country:
Posts: n/a
vCash:
Daly: European expansion on the horizon

You beat me by 30 seconds, as I was about to post the Globe article:

Time to sit back and watch some fireworks in the BOH. It's been a bit quiet lately.

William Houston at The Globe reports that Daly confirms the NHL is thinking Euro expansion within the next ten years. [The author adds that the most likely scenario would be to place a division - six teams - in six European countries.] There are snippets from Paul Kelley (NHLPA) and Rutherford (Canes GM) who endorse the idea in general, but say they'd like to see weaker US teams stabilized first.

Quote:
European expansion on the horizon, Daly says
WILLIAM HOUSTON, Globe and Mail
September 12, 2008 at 2:27 AM EDT

The NHL is aiming to have teams based in Europe within the next 10 years, the league's deputy commissioner said yesterday.

“As time goes on, you'll see us making increasing movement into Europe,” Bill Daly said in an interview. “Certainly, it's a possibility that within 10 years time we will be playing games there.”

Asked whether he viewed European expansion within 10 years as a good possibility, he said: “I hope so. But again, I think it's a long way between here and there. And I think all the pieces have to continue to line up in order for that to happen.
Daly expands further on some business points later in the article:

Quote:
Challenges confronting NHL expansion to Europe include taxation laws that would impact on player salaries, the distance of travel between Europe and North America and the time difference between the two continents for television broadcasts.

The big question, Daly says, is the ability of European NHL clubs to generate enough revenue to compete with North American counterparts.

“The North American economy has a certain demand for North American sports content,” he said. “I'm not sure that, in the short term, most European economies match that level of demand in terms of types of prices you could charge, etc.

“So, in dealing with a sports-league concept, you want markets that are at least within the same universe to at least support and charge for tickets and support player payrolls.”

Daly said sponsorship initiatives could mitigate lost income from ticket prices that would be lower than those in the United States and Canada.

“Certainly, sponsorship opportunities in European cities may, in some cases, especially if the team is embraced as kind of a national team, present better financial options than for some of our clubs,” he said.
Some supporting points for interest from Europe are noted, including that 30% of NHL players are from European countries, and that 25-35% of NHL.com's unique traffic is European. (I know all of them too. They're scouring the web for links so they can watch games. )

Hopefully the posters here can discuss some of the business points raised by Daly:

*European taxation on salaries/teams
*Effect of distance on travel and TV coverage
*Gate revenues expected to be less than NA teams
*Sponsorships in Europe may be a higher value, or able to potentially mitigate shortfall in gate revenues
*Competition from other European leagues
*Transfer agreements-- any EU laws in play??

As part of the discussion on time differences and TV coverage, a European division may have to play most of its games within that division and thus have an uniquely unbalance schedule, including the playoffs.

Is this a good idea, to expand as a league versus expanding the NHL brand but being a stand-alone/spinoff league if the NHL insists they have growth opportunities there. (Okay, if AEG insists they have growth opportunities there... )



Try to keep on topic so this doesn't become another relocation or expandsion thread to (a) cities you like or that deserve teams according to you, and (b) which have no supporting comments from league execs for even being on the radar screen. Thanks.

  Reply With Quote
Old
09-12-2008, 12:20 PM
  #3
bornfromjets
Registered User
 
bornfromjets's Avatar
 
Join Date: Jul 2006
Posts: 101
vCash: 500
I posted this in the NHL Talk Board a while ago:

http://hfboards.com/showthread.php?t=550975

But it does make more sense here i guess.

bornfromjets is offline   Reply With Quote
Old
09-12-2008, 12:31 PM
  #4
Fugu
Guest
 
Country:
Posts: n/a
vCash:
Quote:
Originally Posted by bornfromjets View Post
I posted this in the NHL Talk Board a while ago:

http://hfboards.com/showthread.php?t=550975

But it does make more sense here i guess.
Thanks for the link. I thought of merging the two threads, but locked it instead. Seeing that it was a Globe story, I'm not sure why everyone is linking to the TSN version, but a merge would push the Globe entry way down in the thread. People tend to respond to the first couple of posts and only then would read the full article.

  Reply With Quote
Old
09-12-2008, 12:34 PM
  #5
KRM
Registered User
 
KRM's Avatar
 
Join Date: Jun 2005
Location: Gothenburg
Country: Sweden
Posts: 11,003
vCash: 500
Very interesting, let's just hope they aim at successful hockey markets.

Quote:
Originally Posted by Crescent Street View Post
Out of curiosity, why don't we see stories like this involving Canadian cities?
Because Europe > Canada.

KRM is offline   Reply With Quote
Old
09-12-2008, 12:41 PM
  #6
NewFang
Registered User
 
NewFang's Avatar
 
Join Date: Aug 2008
Country: Canada
Posts: 6,677
vCash: 500
Obviously most Euro players would love to play there. But you would still have NA players who don't want to go over, and vise-versa, so it might get messy in terms of trades and contracts. The dynamics of the NHL would change dramatically IMO.

It's bad enough right now with no one wanting to play in Edmonton or Buffalo

NewFang is offline   Reply With Quote
Old
09-12-2008, 12:51 PM
  #7
jamiebez
Registered User
 
jamiebez's Avatar
 
Join Date: Apr 2005
Location: Ottawa
Country: Canada
Posts: 3,402
vCash: 500
Quote:
Originally Posted by Fugu View Post
Hopefully the posters here can discuss some of the business points raised by Daly:

*European taxation on salaries/teams
*Effect of distance on travel and TV coverage
*Gate revenues expected to be less than NA teams
*Sponsorships in Europe may be a higher value, or able to potentially mitigate shortfall in gate revenues
*Competition from other European leagues
*Transfer agreements-- any EU laws in play??
This is the showstopper for me, especially during the playoffs.

Imagine the travel involved in a Stockholm/Vancouver or New York/Moscow Stanley Cup finals. In the regular season, you could mitigate somewhat it by having every team barnstorm through Europe once, with a generous break before and after the trip, but the jet lag for a visiting team in a playoff series is a lot to overcome without streching it out to 3 weeks or something like that. Even with a 2-3-2 format, that's a LOT of travel.

If they're insistent on going into Europe I think they'd be better off with an "NHL Europe" - a totally seperate league with a seperate championship. That might get around some of the other issues listed above as well.

I have to wonder if this kind of talk indicates the level of worry about the KHL eating their lunch, not just in Europe but by potentially draining the NA talent pool even further.

jamiebez is offline   Reply With Quote
Old
09-12-2008, 12:54 PM
  #8
Den
Registered User
 
Join Date: Aug 2005
Location: Stockholm
Country: Russian Federation
Posts: 5,949
vCash: 500
Even if all business components are in place (market, demand), I still can't see how you can beat the jetleg On the other hand the travel situation in the KHL approaches this kind of time diff, and it works, but teams don't have to travel to the Far East that often...

Den is offline   Reply With Quote
Old
09-12-2008, 01:08 PM
  #9
Fabs
Registered User
 
Join Date: Dec 2005
Country: Canada
Posts: 2,261
vCash: 500
I'll believe it when I see it. Until than its just talk that goes nowhere.

Fabs is offline   Reply With Quote
Old
09-12-2008, 01:21 PM
  #10
jkrdevil
UnRegistered User
 
jkrdevil's Avatar
 
Join Date: Apr 2006
Location: Maryland
Country: United States
Posts: 30,380
vCash: 500
Quote:
Originally Posted by Fugu View Post
*Transfer agreements-- any EU laws in play??
There may be a few. I believe there would be an issue with the CBA. I don't believe in Europe having an collectivel bargained agreement gives an exemption to the laws the way it does in the US. That would put the draft and restricted free agency in jeopardy as it restricts the movement of out of contract players which woul certaintly be illegal in Europe. I'll have to find the passege but there is a book called Transatlantic Sport that basically cmpares the two sporting models and looks at the issues in both North American and European sport. A preveiw is available on Google I'll see if I can find the quote dealing with CBA's in Europe.

There is also cultural issues as franchising of teams don't exist in Europe. People are more fans of teams than leagues over there and there is a question of if there would be acceptance of new teams that ave now historical local ties to the communities there.

jkrdevil is online now   Reply With Quote
Old
09-12-2008, 01:57 PM
  #11
TravisUlrich
Eternal Optimist
 
TravisUlrich's Avatar
 
Join Date: Jun 2005
Location: Thunder Bay, Ontario
Country: Canada
Posts: 12,810
vCash: 500
Wow, 10 comments in and no one has given the obligatory "They need to make sure things are right at home before they go abroad!" comment.

I like this idea of franchising to established hockey markets, though there are obvious hurdles, and get away from depending solely on the U.S. market to grow the game.

TravisUlrich is offline   Reply With Quote
Old
09-12-2008, 02:12 PM
  #12
Tinalera
Registered User
 
Tinalera's Avatar
 
Join Date: Feb 2007
Location: The Known Universe
Posts: 6,018
vCash: 500
Quote:
Originally Posted by Fugu View Post
*European taxation on salaries/teams
*Effect of distance on travel and TV coverage
*Gate revenues expected to be less than NA teams
*Sponsorships in Europe may be a higher value, or able to potentially mitigate shortfall in gate revenues
*Competition from other European leagues
*Transfer agreements-- any EU laws in play??




Try to keep on topic so this doesn't become another relocation or expandsion thread to (a) cities you like or that deserve teams according to you, and (b) which have no supporting comments from league execs for even being on the radar screen. Thanks.
Will this be a case of a race between the KHL and NHL to see who gets EU cities first? We will wait to see how the KHL manages business, but is there a change the KHL will effectively "buyout" EU cities with provisions they can't have an NHL within a certain radius?


The gate receipt is going to be interesting as well: if the EU has lower gate receipts than some us counterparts, will there be a hue and cry from the North American owners? I would think some might argue that the EU will be given a "free ride" when it comes to possible lower gate receipt.

Tinalera is offline   Reply With Quote
Old
09-12-2008, 02:17 PM
  #13
Snoil11
Registered User
 
Join Date: Aug 2006
Location: Germany
Country: Germany
Posts: 3,336
vCash: 500
Send a message via ICQ to Snoil11 Send a message via Yahoo to Snoil11
Quote:
Originally Posted by Fugu View Post
Hopefully the posters here can discuss some of the business points raised by Daly:

*European taxation on salaries/teams
This will be a huge hurdle for any German team, as taxation is already a huge issue for the DEL, as one reason, why German teams are unable to compete with the Russian and Swiss ones when it comes to player salaries, is the huge difference in tax rates.
While German government has been generous to soccer teams and the soccer federation, it played hardball against the German Ice Hockey Federation, when it requested a waiver of the German withholding tax to cater the 2009 WC.

Quote:
*Effect of distance on travel and TV coverage
I deem TV coverage to be a minor issue compared to most of the other topics raised by Daly. Travel however is a major concern and I have no idea how to solve this problem. This is probably more of an issue to the North-American teams than the European ones, as they could play up to 10+ games on a single road-trip and should be able to adapt to the American time zone.
The easiest solution is probably a heavy interdivisional schedule with the European teams playing each other a lot, which on the other side might limit the marketability of the league, as European fans aren't used to 82+ games schedules and love variety.

Quote:
*Gate revenues expected to be less than NA teams
IMO this might become the second biggest issue, as Europeans are not willing to pay up to 80$ a night 41+ times a year to watch a single team. Most of the European leagues recently reduced the number of teams to shorten the schedule. Don't get me wrong, European hockey fans love the play-off-system, yet it is an anomaly in European team sports perception, which is dominated by soccer. Thus the casual fan is still used to a 34+ games schedule, where each team faces each other twice (one homegame and one on the road) and the final standings determine the champion. Moreover, soccer tickets are usually (Premier League aside) much cheaper than NHL ones', so this is another challenge for the league. The NHL however will need those casual fans to sell-out his games and generate half-decent gate-revenue.

Quote:
*Sponsorships in Europe may be a higher value, or able to potentially mitigate shortfall in gate revenues
They are definitely able to mitigate the shortfall, but the NHL would have to allow ads on jerseys, socks and hockey equipment for this to happen.

Quote:
*Competition from other European leagues
Good point as well, as Europeans usually stick to their (hometown)club, which are part of the cities' and sports' history. Thus it might be advisable to market potential European franchises as national teams.

Quote:
*Transfer agreements-- any EU laws in play??
This is by far the biggest obstacle and I do not see this problem to be solved anytime soon. European lawyers, labor lawyers and most importantly antitrust agencies will be all over the CBA and tear it apart before the first game is played.
Trades without the player's permission? - Salary cap? - Restricted Free Agency? - Drafting and obtaining player rights?
All those things are inconsistent with European law and European jurisdiction, which has dratsically altered the European sport landscape since its foundation and has proven the willingness to take on big businees.


Last edited by Snoil11: 09-12-2008 at 02:42 PM.
Snoil11 is offline   Reply With Quote
Old
09-12-2008, 02:23 PM
  #14
Snoil11
Registered User
 
Join Date: Aug 2006
Location: Germany
Country: Germany
Posts: 3,336
vCash: 500
Send a message via ICQ to Snoil11 Send a message via Yahoo to Snoil11
Quote:
Originally Posted by Tinalera View Post
Will this be a case of a race between the KHL and NHL to see who gets EU cities first? We will wait to see how the KHL manages business, but is there a change the KHL will effectively "buyout" EU cities with provisions they can't have an NHL within a certain radius?
Do you mean, that the KHL might pay certain cities money for not admitting the NHL or that the KHL might place their teams in strategical important city, so that the respective market is already satured?
If it's the former, don't worry, as the European Court of Justice and the European antitrust agency would abolish this agreement faster than you can say KHL.

Snoil11 is offline   Reply With Quote
Old
09-12-2008, 02:24 PM
  #15
tiredman
Registered User
 
tiredman's Avatar
 
Join Date: Nov 2003
Location: Ville de Québec
Country:
Posts: 4,972
vCash: 500
How hard is it going to be to find the owners of the new teams in Europe ? I mean, most of these guys have to be billionaires and will have to build new arenas for their teams too...

tiredman is offline   Reply With Quote
Old
09-12-2008, 02:32 PM
  #16
kdb209
Global Moderator
 
kdb209's Avatar
 
Join Date: Jan 2005
Posts: 12,432
vCash: 500
Quote:
Originally Posted by Fugu View Post
Hopefully the posters here can discuss some of the business points raised by Daly:

*European taxation on salaries/teams
*Effect of distance on travel and TV coverage
*Gate revenues expected to be less than NA teams
*Sponsorships in Europe may be a higher value, or able to potentially mitigate shortfall in gate revenues
*Competition from other European leagues
*Transfer agreements-- any EU laws in play??
The other BIG BoH question is - how in the hell do you negotiate a CBA that complies with anti trust and labor laws in the US, Canada, EU, and Russia? Can restrictions like an Entry Draft and Restricted Free Agency be reconciled with EU law in light of the Bosman ruling (and the underlying law it was based on) in football/soccer? Does European anti trust law recognize anything similar to the Non Statutory Exemption granted to the products of collective bargaining under US court precedent (the draft, restrictions on player eligibility, and any form of RFA status would be illegal in the US without it)?

Other issues:

In order to seed success in Europe (at least initially) would the league have to implement some form of draft/signing preferences - similar to what Montreal once had over players coming out of Quebec?

How do you sell to the NHLPA rank-and-file (the majority of which are still NA) on the possibility of being traded overseas? I think MANY players would have serious issues w.r.t. family life in being traded to Helsinki or Moscow or ..., not no mention tax implications. I think the NHLPA would require major concessions to get approval from the majority of it's current members - significant concessions in other areas or perhaps a standardized NTC for all players for trades in/out of the European division.

And from the players POV - what really are the benefits of a European expansion for the NHLPA and it's current membership? More jobs - yes, but that won't necessarily help the bulk of current borderline players (who are the ones most concerened with jobs) since I would expect the bulk of the new roster spots to be filled by Euros. Higher salaries - not unless the new teams can generate at least NHL median revenues - competition from the KHL is probably a better mechanism for the players to drive up salaries.

kdb209 is online now   Reply With Quote
Old
09-12-2008, 02:34 PM
  #17
Snoil11
Registered User
 
Join Date: Aug 2006
Location: Germany
Country: Germany
Posts: 3,336
vCash: 500
Send a message via ICQ to Snoil11 Send a message via Yahoo to Snoil11
Quote:
Originally Posted by jamiebez View Post
If they're insistent on going into Europe I think they'd be better off with an "NHL Europe" - a totally seperate league with a seperate championship. That might get around some of the other issues listed above as well.
As the NHL would not be willing to sacrifice its top-end-talents to play in a league, which does not cater the North-American market, the league would fail miserably, as Europeans would not be willing to watch a league, which would have about the same talent level as the historically grown league's in their homecountry.
You might pry away fans from the European leagues, if you serve top-end-talent, but people won't switch loyalities to see guys like Markus Nilsson, Anders Eriksson and Rhett Warrener, who are past their prime respectively are borderline NHL'er. Players like them might be celebrated stars in European leagues, which however are ingrained within the respective society.

Snoil11 is offline   Reply With Quote
Old
09-12-2008, 02:40 PM
  #18
Snoil11
Registered User
 
Join Date: Aug 2006
Location: Germany
Country: Germany
Posts: 3,336
vCash: 500
Send a message via ICQ to Snoil11 Send a message via Yahoo to Snoil11
Quote:
Originally Posted by tiredman View Post
How hard is it going to be to find the owners of the new teams in Europe ? I mean, most of these guys have to be billionaires and will have to build new arenas for their teams too...
Arenas shouldn't be an issue, as there are lots of NHL-like arenas in Europe nowadays (Cologne, Prag, Stockholm, London, Berlin, Bern to name a few), although their capacity is usually a bit less than the NHL average.

Snoil11 is offline   Reply With Quote
Old
09-12-2008, 04:03 PM
  #19
jamiebez
Registered User
 
jamiebez's Avatar
 
Join Date: Apr 2005
Location: Ottawa
Country: Canada
Posts: 3,402
vCash: 500
Quote:
Originally Posted by Snoil11 View Post
As the NHL would not be willing to sacrifice its top-end-talents to play in a league, which does not cater the North-American market, the league would fail miserably, as Europeans would not be willing to watch a league, which would have about the same talent level as the historically grown league's in their homecountry.
You might pry away fans from the European leagues, if you serve top-end-talent, but people won't switch loyalities to see guys like Markus Nilsson, Anders Eriksson and Rhett Warrener, who are past their prime respectively are borderline NHL'er. Players like them might be celebrated stars in European leagues, which however are ingrained within the respective society.
Good point.

We may be seeing this with the KHL - to some extent already in their difficulty attracting high-end (even high-end Russian) talent, and even moreso once they start expanding into other European cities where they'll be competing against established leagues.

I realize Europe would be treated as "second class citizens" in this scenario, but I just threw it out there since I don't see a way to make it work with teams in two continents in the same league.

jamiebez is offline   Reply With Quote
Old
09-12-2008, 04:11 PM
  #20
Den
Registered User
 
Join Date: Aug 2005
Location: Stockholm
Country: Russian Federation
Posts: 5,949
vCash: 500
Quote:
Originally Posted by Snoil11 View Post
As the NHL would not be willing to sacrifice its top-end-talents to play in a league, which does not cater the North-American market
I don't see this as a valid point. The moment the NHL signs up to this enterprise, they will have to allow for free flow of players, so the talent will be the same on both sides. There are many other reasons why this won't work, but not this one: this is not an issue at all if this league starts

Den is offline   Reply With Quote
Old
09-12-2008, 04:13 PM
  #21
Den
Registered User
 
Join Date: Aug 2005
Location: Stockholm
Country: Russian Federation
Posts: 5,949
vCash: 500
Quote:
Originally Posted by jamiebez View Post
Good point.

We may be seeing this with the KHL - to some extent already in their difficulty attracting high-end (even high-end Russian) talent
Well, this one is called KHL, not NHL, right? Another league, a level of play a notch below, money a notch below. We are talking about one and the same league across the ocean.

Den is offline   Reply With Quote
Old
09-12-2008, 04:16 PM
  #22
Tinalera
Registered User
 
Tinalera's Avatar
 
Join Date: Feb 2007
Location: The Known Universe
Posts: 6,018
vCash: 500
I just wonder if the NHL is going to do what the NFL did-a EU league that doesn't have a direct competitive connection to it's parent, other than maybe an annual year end game, whether it would be champ vs champ or whatever. We do, of course, see what happened to NFL Europe. The thing that worries me there is that NHL EU would just become a place for castoffs of NHLers, and that's not fair to the EU fans. I await either the owners or players association promising that there would be top end talent playing overseas.

"Fans, welcome your Berlin Penguins!"

Tinalera is offline   Reply With Quote
Old
09-12-2008, 04:20 PM
  #23
Snoil11
Registered User
 
Join Date: Aug 2006
Location: Germany
Country: Germany
Posts: 3,336
vCash: 500
Send a message via ICQ to Snoil11 Send a message via Yahoo to Snoil11
Quote:
Originally Posted by Den View Post
I don't see this as a valid point. The moment the NHL signs up to this enterprise, they will have to allow for free flow of players, so the talent will be the same on both sides. There are many other reasons why this won't work, but not this one: this is not an issue at all if this league starts
Quote:
Originally Posted by Den View Post
Well, this one is called KHL, not NHL, right? Another league, a level of play a notch below, money a notch below. We are talking about one and the same league across the ocean.
@Den:
My reply refered to jamiebez idea of a seperate league labelled as 'NHL Europe', which would not be the same league across the ocean but an European affiliate.

Snoil11 is offline   Reply With Quote
Old
09-12-2008, 04:25 PM
  #24
Den
Registered User
 
Join Date: Aug 2005
Location: Stockholm
Country: Russian Federation
Posts: 5,949
vCash: 500
Quote:
Originally Posted by Snoil11 View Post
@Den:
My reply refered to jamiebez idea of a seperate league labelled as 'NHL Europe', which would not be the same league across the ocean but an European affiliate.
Oh,yeah, NHL Eu won't work for this very reason of course

Den is offline   Reply With Quote
Old
09-12-2008, 04:27 PM
  #25
Snoil11
Registered User
 
Join Date: Aug 2006
Location: Germany
Country: Germany
Posts: 3,336
vCash: 500
Send a message via ICQ to Snoil11 Send a message via Yahoo to Snoil11
Quote:
Originally Posted by Tinalera View Post
The thing that worries me there is that NHL EU would just become a place for castoffs of NHLers, and that's not fair to the EU fans.
Don't worry about the EU fans, as they would not pay attention, if it is just a league for NHL castoffs. If the NHL wants to compete with the national leagues, they have to offer a significant increase in talent level. Otherwise this NHL Europe will be a stillbirth.

Snoil11 is offline   Reply With Quote
Reply

Forum Jump


Bookmarks

Thread Tools

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off



All times are GMT -5. The time now is 09:11 PM.

monitoring_string = "e4251c93e2ba248d29da988d93bf5144"
Contact Us - HFBoards - Archive - Privacy Statement - Terms of Use - Advertise - Top - AdChoices

vBulletin Copyright ©2000 - 2014, Jelsoft Enterprises Ltd.
HFBoards.com is a property of CraveOnline Media, LLC, an Evolve Media, LLC company. ©2014 All Rights Reserved.