HFBoards

Go Back   HFBoards > General Hockey Discussion > The Business of Hockey
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.

What if...(mod: relocation proposal, subsequent effect on HRR)

Reply
 
Thread Tools
Old
01-04-2013, 04:38 PM
  #76
ONO94
Registered User
 
Join Date: Jan 2010
Posts: 235
vCash: 500
Quote:
Originally Posted by Riptide View Post
Not even close. And you're making a huge (and largely incorrect) assumption. By everyone's accounts, a team in Toronto would instantly be in the top 5 (revenue wise) in the league.

Additionally, with the cap tied to HRR, if the Canadian dollar falls (another assumption - as there's no sign of it happening any time soon), revenues will fall with it, and the cap will go down accordingly.

That said, other than perhaps moving Phoenix - a team that's had issues drawing fans despite great on ice success, I wouldn't move any of the teams... simply because it's NOT a long term solution. But I wouldn't hesitate to expand the league to 32 teams with one in Ontario and in Quebec City. Or Seattle if Phoenix moved to one of those locations.
Actually--no, the assumption is not largely incorrect. Your assumption is that a second team in Toronto would make new money that would not cost any other team money in return. That assumption is largely wrong (and the assumptions about the QC team as well) because you are thinking that there is some large contingent of Canadians that are just dying to spend money on hockey they are not currently spending. The simple fact is that there are not enough seats in the ACC to support all of the Leafs fans--so instead they either support passively through merchandise buying and Leaf TV watching or they also support another team. If another team comes to the GTA, some fans are going to give more money to the new team and less to the Leafs, cutting the money the Leafs have available to share. And the second group will now not go the Sabre's games as much, which now would put them in revenue jeopardy as well.

Regardless--unless you want tickets costs as the pretty much the only revenue generator of the new teams, it doesn't make long term business sense to move teams to most Canadian cities. Again, companies are not going to put new money into a sport they are already supporting--they will split the money, at best.

For a potential team in Seattle--yes, I would be a bit worried about sports saturation--however, there is not another hockey team in Seattle to siphon profits from. All of the hockey money would be new hockey money and could largely be a different crowd to advertise than the NBA (especially), MLB and NFL. On top of having 3.5 million potential season ticket holders to choose from--it could be a good deal. Or it may not--it's all hypothetical, of course.

ONO94 is offline   Reply With Quote
Old
01-04-2013, 05:15 PM
  #77
TaketheCannoli
RIP
 
TaketheCannoli's Avatar
 
Join Date: Nov 2006
Location: Ohio
Country: United States
Posts: 8,392
vCash: 500
Quote:
Originally Posted by Riptide View Post
Not even close. And you're making a huge (and largely incorrect) assumption. By everyone's accounts, a team in Toronto would instantly be in the top 5 (revenue wise) in the league.

Additionally, with the cap tied to HRR, if the Canadian dollar falls (another assumption - as there's no sign of it happening any time soon), revenues will fall with it, and the cap will go down accordingly.

That said, other than perhaps moving Phoenix - a team that's had issues drawing fans despite great on ice success, I wouldn't move any of the teams... simply because it's NOT a long term solution. But I wouldn't hesitate to expand the league to 32 teams with one in Ontario and in Quebec City. Or Seattle if Phoenix moved to one of those locations.
the Leafs have said show us that a second team will not cut into our revenues and also Buffalo's and Detroit's revenues and we will listen. Burke said while they have a waiting list for tickets, there are unsold boxes and suites . The waiting list is not large enough to sell out another arena either.

Thats an indication its not a guarantee to sell out without effecting the Leafs' revenues.

TaketheCannoli is offline   Reply With Quote
Old
01-04-2013, 05:19 PM
  #78
MoreOrr
B4
 
MoreOrr's Avatar
 
Join Date: Jun 2006
Location: Mexico
Country: Canada
Posts: 17,719
vCash: 500
Quote:
Originally Posted by hossua34 View Post
Or unless you have an insular, niche league with about 10 teams... The thing about these constant relocation debates is that you CAN'T have 20+ teams with consistently high profit margins. You either have to have a league composed of only the perennial rich teams (in which case hockey ceases to be relevant outside of Canada and a small swath of the northeastern US), or you have a degree of revenue distribution that keeps struggling teams afloat until it's clear that they are hopeless as hockey markets.

You start losing credibility when you suggest a team like Columbus be relocated, and then throw out Houston as a conceivable destination. I mean, are you serious? You have to know LESS than nothing about geography and demographics to posit that Houston (or Vegas even, which has amazingly been suggested) is a better long-term market than Columbus. Sure, it might be better in the few years that the novelty lasts, but in that case just call your plan what it is: an attempt to maximize profits by playing musical chairs with less-established franchises.
Another who understands the reality of the whole rather than just the reality of the few. The problem here, on HFB, is that the membership dynamic probably fairly closely mirrors the League fanbase dynamic. I'd bet that at least 2/3 to 3/4 of those who argue that the relocation of a few economic bottom level teams would go a long way to solving the League's problems, are fans of one of those teams at the top level, and as such they have only top-level understanding of the League's overall fanbase dynamic and thus the League's overall economic dynamic.

MoreOrr is offline   Reply With Quote
Old
01-04-2013, 05:24 PM
  #79
Killion
Global Moderator
 
Killion's Avatar
 
Join Date: Feb 2010
Location: Pacific NW
Country: Canada
Posts: 21,249
vCash: 500
Quote:
Originally Posted by TaketheCannoli View Post
the Leafs have said show us that a second team will not cut into our revenues and also Buffalo's and Detroit's revenues and we will listen. Burke said while they have a waiting list for tickets, there are unsold boxes and suites . The waiting list is not large enough to sell out another arena either. Thats an indication its not a guarantee to sell out without effecting the Leafs' revenues.
Oh, no question a 2nd team within or resting right on the border of the GTA like Markham would absolutely eat into the Leafs revenues, along with those of the ACC with increased competition for non-hockey related bookings. Now Hamilton, thats a different matter altogether, which is why given my druthers Id be far more supportive of a team either being awarded through Expansion or if needs be via Relocation to Copps.

Killion is online now   Reply With Quote
Old
01-04-2013, 06:05 PM
  #80
Fugu
Administrator
HFBoards
 
Fugu's Avatar
 
Join Date: Nov 2005
Country:
Posts: 29,141
vCash: 500
Quote:
Originally Posted by MoreOrr View Post
Another who understands the reality of the whole rather than just the reality of the few. The problem here, on HFB, is that the membership dynamic probably fairly closely mirrors the League fanbase dynamic. I'd bet that at least 2/3 to 3/4 of those who argue that the relocation of a few economic bottom level teams would go a long way to solving the League's problems, are fans of one of those teams at the top level, and as such they have only top-level understanding of the League's overall fanbase dynamic and thus the League's overall economic dynamic.

You're confusing personal preferences with economic factors that some people do cite (including sports economists). It's possible that the league's overall economic situation has some issues that have nothing to do with what you or I would "prefer" nor what we believe to be the correct answer. Nothing says that the NHL must be a 16, 24, 30 or 40 team league. However, once you pick a number, there will be different economic variables to consider.

Fugu is online now   Reply With Quote
Old
01-04-2013, 06:10 PM
  #81
BLONG7
Registered User
 
BLONG7's Avatar
 
Join Date: Oct 2002
Location: Nova Scotia
Posts: 12,261
vCash: 500
Quote:
Originally Posted by TaketheCannoli View Post
the Leafs have said show us that a second team will not cut into our revenues and also Buffalo's and Detroit's revenues and we will listen. Burke said while they have a waiting list for tickets, there are unsold boxes and suites . The waiting list is not large enough to sell out another arena either.

Thats an indication its not a guarantee to sell out without effecting the Leafs' revenues.
Most Leaf fans will tell you, the team has put the screws to their real fans, raising prices, while icing a non playoff team for 7 yrs....if these fans were given a choice, they might just go to a game in Hamilton, or Markham and it might hurt the Leafs revenues a bit, it would also force them to do a better job icing a better team...and their fans would love that... which in turn would lead to better revenues...

BLONG7 is offline   Reply With Quote
Old
01-04-2013, 06:58 PM
  #82
Riptide
Moderator
 
Riptide's Avatar
 
Join Date: Dec 2011
Location: Yukon
Country: Canada
Posts: 8,419
vCash: 500
Quote:
Originally Posted by ONO94 View Post
Actually--no, the assumption is not largely incorrect. Your assumption is that a second team in Toronto would make new money that would not cost any other team money in return. That assumption is largely wrong (and the assumptions about the QC team as well) because you are thinking that there is some large contingent of Canadians that are just dying to spend money on hockey they are not currently spending. The simple fact is that there are not enough seats in the ACC to support all of the Leafs fans--so instead they either support passively through merchandise buying and Leaf TV watching or they also support another team. If another team comes to the GTA, some fans are going to give more money to the new team and less to the Leafs, cutting the money the Leafs have available to share. And the second group will now not go the Sabre's games as much, which now would put them in revenue jeopardy as well.
Quote:
Originally Posted by TaketheCannoli View Post
the Leafs have said show us that a second team will not cut into our revenues and also Buffalo's and Detroit's revenues and we will listen. Burke said while they have a waiting list for tickets, there are unsold boxes and suites . The waiting list is not large enough to sell out another arena either.

Thats an indication its not a guarantee to sell out without effecting the Leafs' revenues.
A couple things people need to consider. Toronto pricing their boxes and suites so high to the point that they're not all selling are their own issues. If you can't sell them all, then chances are you're pricing yourself too high.

One, that's NOT what you said. You said that the mark for hockey dollars in Canada has pretty much been reached. I'm telling you that's completely false. No where did I say it would not impact Toronto at all. Of course it would to some extent. But to what extent is largely debatable. But there's still tons of money to be spent in/around Toronto when it comes to NHL hockey tickets. The demand is easily there to fill the ACC two or three times over if it was bigger. Would the Leafs feel the hit from sponsors? To some extent without a doubt. But neither they or another team would have any issues selling out nightly.

The fact that Toronto only has a 5-8k waiting list (or whatever it actually is), doesn't mean that everyone who wants tickets is on that list, or is able to get tickets. When it's something like a 20 yr waiting list, there's not much point in putting your name on the list (especially as there's ways around the list).

I have a bunch of family in/surrounding Toronto. They refuse to buy tickets from scalpers, and will ONLY buy them from STH at cost or from the Leafs - the result? They go to 3-4 games a year. They're die hard Leaf fans... but like many fans, don't often buy merchandize (perhaps a jersey every few years - if that), and only get to go to a handful of games a year. Always due to ticket availability - or the severe lack thereof. They subsidize this by going to a handful of other out of town games a year (Buffalo, Pittsburgh, Detroit, etc). However all of those games involve road trips and overnight stays. And they're not alone. There's many many Leaf fans in this same boat. Toronto simply cannot fulfill the demand for NHL hockey in Toronto/Southern Ontario. And people who can't get tickets don't all go out and spend that money on Toronto/NHL merchandize.

There's 5.5m people in the GTA (as per wiki). If only 1% of those people are willing to spend money on tickets (55,000 people), that's easily enough to fill more than 2 arena's in/around Toronto. So yes Toronto would feel something when it comes to advertisers, TV rights and their luxury boxes... but they wouldn't feel squat when it comes to tickets - which makes up the majority of any teams revenue stream.

__________________
"Itís not as if Donald Fehr was lying to us, several players said. Rather, itís as if he has been economical with information, these players believe, not sharing facts these players consider to be vital."
Riptide is offline   Reply With Quote
Old
01-04-2013, 07:36 PM
  #83
MoreOrr
B4
 
MoreOrr's Avatar
 
Join Date: Jun 2006
Location: Mexico
Country: Canada
Posts: 17,719
vCash: 500
Quote:
Originally Posted by Fugu View Post
You're confusing personal preferences with economic factors that some people do cite (including sports economists). It's possible that the league's overall economic situation has some issues that have nothing to do with what you or I would "prefer" nor what we believe to be the correct answer. Nothing says that the NHL must be a 16, 24, 30 or 40 team league. However, once you pick a number, there will be different economic variables to consider.
Yes, can't deny that I have personal preferences,... as does everyone. But if we're arguing the size of the League, I'd also say beyond my preference (which would be a League of 24 to 36 teams, but with Divisions no bigger than 7 teams, preferably 5 or 6), that to be even considered in the "Big Leagues" of NA, the NHL has to have a comparable number of teams. It may not be a necessity for the League to be a 'good league', but for bringing in certain fans, size counts, perception counts, and that size also counts for media contracts... the size of the League and the size of its fanbase on a national scale. So yes, my preference is for the League to have around 30 teams, but I also believe that that's an economically beneficial size for the League.

MoreOrr is offline   Reply With Quote
Old
01-04-2013, 08:48 PM
  #84
sandysan
Registered User
 
Join Date: Dec 2011
Posts: 4,275
vCash: 500
Quote:
Originally Posted by Killion View Post
sandy, is there any particular reason why you feel it necessary to single out Columbus, disturbing & upsetting an entire fan base in espousing opinion that is only half formed, selective? Ignoring the realities of gross incompetence in the Executive & General Managers suites combined with a punitive lease & avaricious competitive facility who had agreed to non-compete's but breached their agreement further exacerbating the already tenuous & difficult position the franchise had found itself in?.

Over the past 12-24 months, they have managed to re-write their lease, addressed the issues, hired a new President in the highly respected John Davidson, have found their sea legs, wind returning to the sails. Ohio, despite its low production of actual players over the years has a history of hockey & support thereof that is easily on par with the best that Quebec, Ontario, BC, Michigan or anywhere else you'd care to throw at it in comparison.

Im stumped to understand why you would feel it necessary to continually rub Blue Jacket's fans and or simply the proud residents of the states noses in the past decade of failure as though they are somehow responsible for it, and "undeserving" of their place in the NHL. Its disingenuous. You really need to bone up on your history, and I would suggest you start with the Cleveland Indians, Barons & Falcons, Crusaders etc etc etc, then take a good hard look at what the Blue Jackets have had to suffer through right out of the box.
Im not saying they are underserving. Everyone thinks that phoenix is pretty much done, they will likely go somewhere, so take one of the common "good" markets off the board. There are still more markets than in my opinion are better right now and going forward than columbus. This is not a knock on columbus fans but my impression of the market. So the question is, do you deprive a yearning immenently stable market of a team to keep a team in a shaky market ? if so for how long ? 15 years ? 30 years ? 45 years ? Of the teams that could be moved I think that all of the indications are that it would be columbus, not because columbus is underserving but because of team valuations and the ease at which someone with demand and medium sized pockets could get them to leave.

I am also somewhat peeved that fans of the nontraditional markets refuse, outright refuse, to put any types of performance expectations on the team. They claim they are gonna get better, you ask when, they say sometime. You ask them how, they say "well team X did it". And I don't think that cross league comparisons are apt when the environments between the two are not at all similar.

Yes renegotiating the lease will help, yes getting davidson will likely help but I havent seen either of these two things yet. what I have seen is in my opinion a very poorly managed club that is struggling to keep pace economically. Mabey in a year or two I will be singing another tune but I'd like to actually see progress as opposed to the mere hope of progress. Ironically a lot of the good things they are doing might get wiped out by the lockout.

I also do not understand why people equate market with attendance. Market has many facets, including management. If you have crappy management a team can fold irrespective of demand ( see atlanta). the market is essentially defined by how much revenue can you extract that has many variables and irrespective of what those variables are, Columbus is struggling.

I dont say that I want Columbus to move. I'm not looking to upset columbus fans. I've said that I hope they dont move but I also said that if in the future there are good reasons to extract a team to a new market, then my position stands that Columbus is in the cross hairs. if they are in the same position at the end of the next CBA as they are now, those calls from other markets will not be able to be ignored.

sandysan is online now   Reply With Quote
Old
01-04-2013, 09:27 PM
  #85
Gump Hasek
Spleen Merchant
 
Gump Hasek's Avatar
 
Join Date: Nov 2005
Location: 222 Tudor Terrace
Posts: 7,254
vCash: 1250
Quote:
Originally Posted by Mayor Bee View Post
Determining the short-term and long-term viability of a market is absolutely based on attendance and population. They're not the be-all-end-all, but it's pretty damned important. To use a standard example, Green Bay is able to have an NFL team because they have a major city just down the road AND because they've been around since the beginning of the league.
No. Determining the short-term and long-term viability of a market is largely based upon revenue garnered per each ticket sold relative to expense. Attendance is irrelevant at the bank; they don't accept deposits of ticket stubs but rather accept the money derived from the sale of those tickets. Company A might sell more widgets than their competitors... but if they are selling those widgets at a price below cost then by extension the use of their raw widget sales volume as a metric of forward viability is essentially useless.


Last edited by Gump Hasek: 01-04-2013 at 09:32 PM.
Gump Hasek is offline   Reply With Quote
Old
01-04-2013, 10:10 PM
  #86
htpwn
Registered User
 
htpwn's Avatar
 
Join Date: Nov 2009
Location: Toronto
Country: Poland
Posts: 12,715
vCash: 500
Quote:
Originally Posted by TaketheCannoli View Post
the Leafs have said show us that a second team will not cut into our revenues and also Buffalo's and Detroit's revenues and we will listen. Burke said while they have a waiting list for tickets, there are unsold boxes and suites . The waiting list is not large enough to sell out another arena either.

Thats an indication its not a guarantee to sell out without effecting the Leafs' revenues.
Of course a new team will cut into the Leafs revenues. Any time a company busts a monopoly, the company holding it will see a drop in revenue. However, unlike consumers, hockey fans are not so fickle with their money. If Bell offers a better cable plan than Rogers, many Rogers customers will quickly switch to Bell. Hockey fans and Leaf fans in particular have an element of loyalty towards the franchise. That isn't going to end because a second team sets up shop down the street.

It seems incredibly silly to bring up either the Leafs unsold suites or waiting lists as an argument. It is irrelevant in any way. The Leafs charge more for a suite than any other teams in the league and yet still have sold over 95% since the 2008 recession and without any playoff hockey in 8 years. The season ticket list is at 5,500 names, costing something like $100 annually to remain on, and a 99.99% renewal wait. If your trying to get upper bowl season tickets through the traditional means, the expected waiting time is over 100 years.

It seems absurd that posters are even questioning whether the richest team in the league, a team recently sold for approximately $1 billion, is going to be significantly hurt when and if a second team int he area sets up shop. If people are so concerned about such a scenario, perhaps they should also advocate moving secondary teams out of New York and Los Angeles. Heck, those are arguably the biggest impediment (not Canadian teams) to building that all-desired "National footprint" some fans want to see achieved.

htpwn is offline   Reply With Quote
Old
01-04-2013, 11:24 PM
  #87
Ryan34222
Registered User
 
Ryan34222's Avatar
 
Join Date: Mar 2010
Location: Hamilton
Country: Canada
Posts: 1,142
vCash: 500
Quote:
Originally Posted by TaketheCannoli View Post


End result? Blues, Islanders and probably Sabres are in trouble.
I got this..
Blues will be fine
Last I heard the Islanders are moving.
And Sabres can move to Hamilton..

There, problem solved

Ryan34222 is offline   Reply With Quote
Old
01-05-2013, 09:19 AM
  #88
Mayor Bee
\/me_____you\/
 
Mayor Bee's Avatar
 
Join Date: Dec 2008
Posts: 14,180
vCash: 500
Quote:
Originally Posted by Captain Bob View Post
Ah. So why do these teams suck if they have all this support?
Attendance #s? Everyone knows how those are fudged.
Check the local television ratings for a real insight into local interest.
Florida Panthers -- 3,000 households watching?
It would stand to reason that if a place is not "a hockey market", then no one would want to watch important games either. And yet...

Look at this. West Palm Beach, which is part of the Miami metro area, outranked several NHL cities and several popular relocation/expansion targets. Fort Myers, also in South Florida, makes the list as well.

Top 25 Metered Markets for 2010 USA-Canada Olympic Gold Medal Hockey Game:
1. Buffalo, 32.6/51
2. Pittsburgh, 31.9/50
3. Detroit, 26.9/47
4. Minneapolis, 26.4/53
5. Milwaukee, 24.5/43
6. Boston, 24.1/46
7. Chicago, 23.5/41
8. Columbus, 22.3/37
9. Denver, 22.2/42
10. Philadelphia, 20.9/35
11. West Palm Beach, 20.3/33
12. Kansas City, 19.5/35
13. St. Louis, 19.4/39
14. Seattle, 19.3/45
15. Cincinnati, 19.2/31
16. New York, 19.0/36
17. Hartford, 18.5/30
18. Providence, 18.4/34
T19. Salt Lake City, 18.3/38
T19. Cleveland, 18.3/32
T21. Washington, D.C., 18.1/33
T21. Baltimore, 18.1/32
23. Ft. Myers, 18.0/34
T24. Austin, 17.1/34
T24. Indianapolis, 17.1/29

Most people outside "traditional" markets have no idea how bad the local TV situation has been. Some games are shown on tape delay, some are randomly blacked out, and a lot aren't even shown at all (due to contract conflicts). Certain cable carriers have the option of bumping scheduled games for something entirely different, despite what the listed schedule actually says. I've addressed these very issues several times on this board.

Mayor Bee is offline   Reply With Quote
Old
01-05-2013, 09:34 AM
  #89
Mayor Bee
\/me_____you\/
 
Mayor Bee's Avatar
 
Join Date: Dec 2008
Posts: 14,180
vCash: 500
Quote:
Originally Posted by Fugu View Post
Is it possible that people's preferences and tastes/interests changed over such a long period of time? I don't think the NFL really "did" a whole bunch other than to wait for the advent of TV and then get on it on Sundays, when everyone had the day off and was looking for something fun to do. When you're looking at periods that last decades, it doesn't mean anyone really shot themselves in the foot, just that society and interests change.
Of course preferences and interests change over time. We can look to horse racing and boxing as examples of things that were once enormously popular and have faded substantially in the last 50 years. But in both cases, that's (in my opinion) in large part due to internal issues. Boxing was wracked by internal divisions and outright corruption, horse racing was damaged by what was perceived to be an unwillingness to address issues involving animal welfare. Tennis, on the other hand, which has not had the same issues, is of similar popularity as it has been throughout history.

In the case of MLB, I think they've done a terrible job in the last 50 years of doing...well, anything. They've allowed the length of games to continue to expand (due to a more and more plodding pace, not because of an exciting product), they've bumbled around the All-Star Game, they've seen a massive contraction of American-born and American-raised stars (particular black Americans, who peaked in MLB around 1975 and have substantially declined ever since). They don't sell the game well, they remain stuck in "tradition" mode, and have the idea that they'll accept someone wants to play or watch the game but not actively reach out in any way.

This is in stark contrast to the NFL, which has done a tremendous job of packaging and selling itself. And it's not just with TV either. Offenses started getting too conservative, so they moved the goal posts to the back of the end zone. Defense started taking over the game, so they passed massive rule changes to open up the game. Too many kickoffs resulted in touchbacks, so they backed up the spot to kick from. And they've actively worked with everything from filmmakers (to spawn NFL Films) to video game companies (to create the Madden series) to internet-based companies (to create and actively participate in fantasy football).

Compare that to this story. When Fox picked up the MLB contract, there was negative backlash against the commentary, particularly among casual viewers. After analyzing the issues, Fox started fining their commentators for every time that they mentioned a player who was both retired and deceased.

Mayor Bee is offline   Reply With Quote
Old
01-05-2013, 09:40 AM
  #90
Mayor Bee
\/me_____you\/
 
Mayor Bee's Avatar
 
Join Date: Dec 2008
Posts: 14,180
vCash: 500
Quote:
Originally Posted by Gump Hasek View Post
No. Determining the short-term and long-term viability of a market is largely based upon revenue garnered per each ticket sold relative to expense. Attendance is irrelevant at the bank; they don't accept deposits of ticket stubs but rather accept the money derived from the sale of those tickets. Company A might sell more widgets than their competitors... but if they are selling those widgets at a price below cost then by extension the use of their raw widget sales volume as a metric of forward viability is essentially useless.
That's really not a valid comparison. You're comparing an event to an actual tangible product, and taking a vague notion of "market" and restricting it. You're also comparing a standard business setup with that of a closed North American professional sports league.

Mayor Bee is offline   Reply With Quote
Old
01-05-2013, 10:40 AM
  #91
Gump Hasek
Spleen Merchant
 
Gump Hasek's Avatar
 
Join Date: Nov 2005
Location: 222 Tudor Terrace
Posts: 7,254
vCash: 1250
Quote:
Originally Posted by Mayor Bee View Post
That's really not a valid comparison. You're comparing an event to an actual tangible product, and taking a vague notion of "market" and restricting it. You're also comparing a standard business setup with that of a closed North American professional sports league.
It is an entirely apt analogy.

The fact of the matter is that you for some reason continue to post random attendance numbers on these boards and usually claim them to be representative of something they are not. Attendance figures sans the underlying revenue context represent essentially meaningless random numbers with zero hint as to market viability, counter to your claim; all they tell you is that X number of people were denoted as having watched a game at a venue. There is nothing to be found within any random attendance number that speaks to forward viability.

Things that speak to market viability are metrics like the revenue generated per each ticket sold relative to expense - and also relative to revenues generated in other markets, television ratings (which speak to advertising rates), etc. In other words, revenues attained per each unit sold versus expense of production, just as the analogy implied.


Last edited by Gump Hasek: 01-05-2013 at 10:45 AM.
Gump Hasek is offline   Reply With Quote
Old
01-05-2013, 10:52 AM
  #92
Steve
Registered User
 
Join Date: Mar 2002
Location: Guelph, Ontario, Can
Posts: 1,242
vCash: 500
I've thought about this for some time. I think some teams will be moved sooner or later. Is it possible to believe the moves/relocations have been held up to assist the NHL's argument about teams not making money? There is no question a few teams bring down the HRR - especially if they're heavily in the negative (See Phoenix). No question if 3 of the bottom 10 teams even broke even it would really hinder the NHL's stance.

It would certainly make a dent overall for profitability and HRR, however, it probably won't chance quite as much as some people think it would.

Steve is offline   Reply With Quote
Old
01-05-2013, 11:26 AM
  #93
Mayor Bee
\/me_____you\/
 
Mayor Bee's Avatar
 
Join Date: Dec 2008
Posts: 14,180
vCash: 500
Quote:
Originally Posted by Gump Hasek View Post
It is an entirely apt analogy.

The fact of the matter is that you for some reason continue to post random attendance numbers on these boards and usually claim them to be representative of something they are not. Attendance figures sans the underlying revenue context represent essentially meaningless random numbers with zero hint as to market viability, counter to your claim; all they tell you is that X number of people were denoted as having watched a game at a venue. There is nothing to be found within any random attendance number that speaks to forward viability.

Things that speak to market viability are metrics like the revenue generated per each ticket sold relative to expense - and also relative to revenues generated in other markets, television ratings (which speak to advertising rates), etc. In other words, revenues attained per each unit sold versus expense of production, just as the analogy implied.
And I assume, then, that you have access to ticket revenue numbers throughout history. That's on a team-by-team and a year-by-year basis, not just two or three random years from the last 20.

When we're talking about market strength for something that is not a consumer good, it has little to do with revenue and a lot to do with local interest. Know why? Because ticket prices can change quickly, because the fortunes of the team can change, and because any of a myriad of other factors can change.

Think of it like a restaurant, which is a popular night out and whose product all ends up the same in the end. Stick a high-end French restaurant in the farming village that I call home, and I can guarantee you that it will fail. There's no French heritage, there's no previous market for French cuisine, and there's not enough money to justify a night out that would hit triple digits on the bill. Put a steakhouse there, and you've got something. So how to make a French restaurant succeed? Start small. Make it cheap, but good. Get people in the door, and build an appreciation for the food.

This is how several regional and foreign cuisines came to become standard in the United States and Canada. 100 years ago, getting a pizza meant making a trip into the Italian village of the nearest major city (if there was one; if you were in Cleveland, great, if you were in Columbus or Cincinnati, tough). Now every small town across both countries has a pizzeria. 50 years ago, Mexican food couldn't be found outside the American Southwest. Now it's everywhere. 25 years ago, sushi ran headlong into every food taboo there was; now you can find it in grocery stores no matter where you go.

Now then, if there was no market for hockey in certain cities, why are the indicators good? If people don't like hockey, they're not showing up to a game even if the tickets are free. If people don't like hockey, they're not watching it on TV, or buying merchandise, or playing the game. And yet in all of these "non-traditional" cities, that's not the case. Look at that list above of TV ratings for the gold medal game. If South Florida is not "a hockey market", why were that many people watching a hockey game on a Sunday afternoon? If Texas isn't "a hockey market", why is a city that's never had anything resembling high-level hockey (Austin) watching that game? I mean, it doesn't even snow there...clearly no one should be watching hockey, right?

Mayor Bee is offline   Reply With Quote
Old
01-05-2013, 11:51 AM
  #94
Gump Hasek
Spleen Merchant
 
Gump Hasek's Avatar
 
Join Date: Nov 2005
Location: 222 Tudor Terrace
Posts: 7,254
vCash: 1250
Quote:
Originally Posted by Mayor Bee View Post
And I assume, then, that you have access to ticket revenue numbers throughout history. That's on a team-by-team and a year-by-year basis, not just two or three random years from the last 20.

When we're talking about market strength for something that is not a consumer good, it has little to do with revenue and a lot to do with local interest. Know why? Because ticket prices can change quickly, because the fortunes of the team can change, and because any of a myriad of other factors can change.

Think of it like a restaurant, which is a popular night out and whose product all ends up the same in the end. Stick a high-end French restaurant in the farming village that I call home, and I can guarantee you that it will fail. There's no French heritage, there's no previous market for French cuisine, and there's not enough money to justify a night out that would hit triple digits on the bill. Put a steakhouse there, and you've got something. So how to make a French restaurant succeed? Start small. Make it cheap, but good. Get people in the door, and build an appreciation for the food.

This is how several regional and foreign cuisines came to become standard in the United States and Canada. 100 years ago, getting a pizza meant making a trip into the Italian village of the nearest major city (if there was one; if you were in Cleveland, great, if you were in Columbus or Cincinnati, tough). Now every small town across both countries has a pizzeria. 50 years ago, Mexican food couldn't be found outside the American Southwest. Now it's everywhere. 25 years ago, sushi ran headlong into every food taboo there was; now you can find it in grocery stores no matter where you go.

Now then, if there was no market for hockey in certain cities, why are the indicators good? If people don't like hockey, they're not showing up to a game even if the tickets are free. If people don't like hockey, they're not watching it on TV, or buying merchandise, or playing the game. And yet in all of these "non-traditional" cities, that's not the case. Look at that list above of TV ratings for the gold medal game. If South Florida is not "a hockey market", why were that many people watching a hockey game on a Sunday afternoon? If Texas isn't "a hockey market", why is a city that's never had anything resembling high-level hockey (Austin) watching that game? I mean, it doesn't even snow there...clearly no one should be watching hockey, right?
I didn't claim to "have access to ticket revenue numbers throughout history" so am unsure of your point; conversely, I did however point out that your use of attendance as a somehow meaningful indicator of forward viability qualifies as extraneous at best. Hope that helps. The balance of your reply here seems a bit of non sequitur as well.

For example, the television ratings in Austin for an unrelated Olympic game is largely irrelevant to an NHL attendance/revenue discussion or for that matter its forward viability as an NHL market - especially given that it isn't one. Let us instead focus instead upon actual NHL markets for this discussion.

You've posted the Olympic game ratings for Columbus already; a more meaningful number however would be if you posted the ratings of the Blue Jackets games instead. Why not post those, and rather than cherry picking and selectively choosing a playoff game, why not just post their raw annual ratings numbers for the regular season, and then post that number up against markets that draw meaningful ratings? That would provide some actual true context to any ratings and or viability discussion as it speaks to viability relative to the group - as their ratings at least imply their ability to generate meaningful local revenue. Raw attendance sans context does not.

Bill Watters claimed when a guest on Prime Time Sports a few weeks ago that Columbus was one of three NHL teams that lost $35 million last season IIRC. If true, that is a number that doesn't seem likely to be cured by a minor increase to their annual league revenue sharing welfare payment... nor by the (realistically) minor improvement to their local lease. I'm guessing their franchise goal is to increase the amount of revenue generated per each ticket sold going forward, just as my analogy initially implied. Good luck.


Last edited by Gump Hasek: 01-05-2013 at 12:06 PM.
Gump Hasek is offline   Reply With Quote
Old
01-05-2013, 12:43 PM
  #95
Mayor Bee
\/me_____you\/
 
Mayor Bee's Avatar
 
Join Date: Dec 2008
Posts: 14,180
vCash: 500
Quote:
Originally Posted by Gump Hasek View Post
I didn't claim to "have access to ticket revenue numbers throughout history" so am unsure of your point; conversely, I did however point out that your use of attendance as a somehow meaningful indicator of forward viability qualifies as extraneous at best. Hope that helps. The balance of your reply here seems a bit of non sequitur as well.

For example, the television ratings in Austin for an unrelated Olympic game is largely irrelevant to an NHL attendance/revenue discussion or for that matter its forward viability as an NHL market - especially given that it isn't one. Let us instead focus instead upon actual NHL markets for this discussion.

You've posted the Olympic game ratings for Columbus already; a more meaningful number however would be if you posted the ratings of the Blue Jackets games instead. Why not post those, and rather than cherry picking and selectively choosing a playoff game, why not just post their raw annual ratings numbers for the regular season, and then post that number up against markets that draw meaningful ratings? That would provide some actual true context to any ratings and or viability discussion as it speaks to viability relative to the group - as their ratings at least imply their ability to generate meaningful local revenue. Raw attendance sans context does not.
You're erroneously assuming that local TV ratings are inherently meaningful of whether a city is a hockey market or not. I've already addressed several reasons why it's not a great indicator under the best of circumstances. Central Ohio has multiple cable providers, who for whatever reason can choose to either show the games or else their own programming. None of them has a basic package that includes both Fox Sports Ohio (which has the contract) and Fox Sports Cincinnati (which occasionally is used as a backup). If one provider decides that they're putting Cleveland Cavaliers preseason games on FSO instead of regular-season CBJ games, that has an impact. If an early show runs late and they decide to not pick up the game broadcast until 2/3 of the way through the 2nd period, that has an impact. We have a thread on the CBJ board that deals with some of these very issues.

You know what Columbus does have? The third-largest adult league in the United States. Booming youth hockey, which just this morning saw two of its graduates win gold medals at the WJC. But if you'd rather focus on local TV ratings, be my guest. I can't force you to pull your own head out of the sand.

Quote:
Bill Watters claimed when a guest on Prime Time Sports a few weeks ago that Columbus was one of three NHL teams that lost $35 million last season IIRC. If true, that is a number that doesn't seem likely to be cured by a minor increase to their annual league revenue sharing welfare payment... nor by the (realistically) minor improvement to their local lease. I'm guessing their franchise goal is to increase the amount of revenue generated per each ticket sold going forward, just as my analogy initially implied. Good luck.
I care not one bit about what Bill Watters has to say. For one thing, the CBJ have always been extremely tight with their financial information. For another, the "minor improvement" you refer to is estimated to save between $9-10 million per year.

Third, the way to increase the amount of revenue generated locally is by having on-ice success. To refer to Columbus as "not a hockey market" because that number is lower than it would ideally be right now is absolute lunacy, mostly because the implication is that people don't show up when the team is having success. This is quite clearly not the case. To say that Columbus has poor long-term prospects is flat-out stupid. To say that Columbus has no short-term prospects is stupid. To say that any current NHL city has no short-term or long-term prospects is stupid, because we've seen very clearly that people have absolutely no problem showing up...the reluctance to pay a massive price to watch a chronically poor on-ice product is perfectly logical, and not at all indicative of anything else except for a logical reaction to a poor product.

Mayor Bee is offline   Reply With Quote
Old
01-05-2013, 12:59 PM
  #96
Gump Hasek
Spleen Merchant
 
Gump Hasek's Avatar
 
Join Date: Nov 2005
Location: 222 Tudor Terrace
Posts: 7,254
vCash: 1250
Quote:
Originally Posted by Mayor Bee View Post
You're erroneously assuming that local TV ratings are inherently meaningful of whether a city is a hockey market or not. I've already addressed several reasons why it's not a great indicator under the best of circumstances. Central Ohio has multiple cable providers, who for whatever reason can choose to either show the games or else their own programming. None of them has a basic package that includes both Fox Sports Ohio (which has the contract) and Fox Sports Cincinnati (which occasionally is used as a backup). If one provider decides that they're putting Cleveland Cavaliers preseason games on FSO instead of regular-season CBJ games, that has an impact. If an early show runs late and they decide to not pick up the game broadcast until 2/3 of the way through the 2nd period, that has an impact. We have a thread on the CBJ board that deals with some of these very issues.
So, you are basically admitting then that Columbus draws embarrassingly poor local NHL television ratings, especially relative to the majority of other NHL markets, just as I suspected. Those ratings speak directly to their ability to generate meaningful local advertising revenue BTW. I'm not interested in local excuses for those poor ratings either, just that the poor ratings indeed exist.

Quote:
I care not one bit about what Bill Watters has to say. For one thing, the CBJ have always been extremely tight with their financial information. For another, the "minor improvement" you refer to is estimated to save between $9-10 million per year.

Third, the way to increase the amount of revenue generated locally is by having on-ice success. To refer to Columbus as "not a hockey market" because that number is lower than it would ideally be right now is absolute lunacy, mostly because the implication is that people don't show up when the team is having success. This is quite clearly not the case. To say that Columbus has poor long-term prospects is flat-out stupid. To say that Columbus has no short-term prospects is stupid. To say that any current NHL city has no short-term or long-term prospects is stupid, because we've seen very clearly that people have absolutely no problem showing up...the reluctance to pay a massive price to watch a chronically poor on-ice product is perfectly logical, and not at all indicative of anything else except for a logical reaction to a poor product.
Whether they win or not is irrelevant. All that matters is the revenue generated by the club relative to expense - profit/loss. If those revenues equate to annual losses that place them amongst the dregs relative to the balance of the group, and especially when coming after the receipt of annual league welfare, then by extension it is logical to at least question their viability going forward. To ignore this speaks directly to the placement of one's head in the sand.

I have work to do now; carry on without me.


Last edited by Gump Hasek: 01-05-2013 at 01:14 PM. Reason: spelling
Gump Hasek is offline   Reply With Quote
Old
01-05-2013, 02:23 PM
  #97
Gnashville
Never trade Weber
 
Gnashville's Avatar
 
Join Date: Jan 2003
Country: United States
Posts: 4,436
vCash: 500
Quote:
Originally Posted by sandysan View Post
I am also somewhat peeved that fans of the nontraditional markets refuse, outright refuse, to put any types of performance expectations on the team. They claim they are gonna get better, you ask when, they say sometime. You ask them how, they say "well team X did it". And I don't think that cross league comparisons are apt when the environments between the two are not at all similar.
There are expections placed on these markets 14K in attendance and X % yearly growth. These come from the NHL not you. Your expectations are for these markets to equal Toronto in revenue, ticket price and attendance. No one refuses expectations it's just we refuse your expectations. You are correct the envoirment between the 2 are vastly different 5+ genereations of fans to less than 1 generation. Also when these expectations are placed on a market understand people are going to notice how you do not place them on Ottawa, Buffalo, Chicago, Edmonton, ect when they don't meet all of your expectations either.

Gnashville is offline   Reply With Quote
Old
01-05-2013, 02:35 PM
  #98
Riptide
Moderator
 
Riptide's Avatar
 
Join Date: Dec 2011
Location: Yukon
Country: Canada
Posts: 8,419
vCash: 500
Quote:
Originally Posted by Mayor Bee View Post
I care not one bit about what Bill Watters has to say. For one thing, the CBJ have always been extremely tight with their financial information. For another, the "minor improvement" you refer to is estimated to save between $9-10 million per year.
The report they had commissioned would disagree with you. It's an interesting read. These guys had access to all of Columbus's financial info. The only downside is that it's not sorted out by year.

http://glennschool.osu.edu/faculty/g...se1_report.pdf

One thing I don't get when people bash Columbus. This is a team that has all the tools for success. Hockey is native to that area, and they support their teams. If this team could get some proper management, they should have the ability to turn things around. No it won't be Toronto... but it could easily be a very profitable team in the league down the road. This is actually the one team I really really hope turns things around, and one I think has the most potential to do so, and not only succeed, but thrive.

Riptide is offline   Reply With Quote
Old
01-05-2013, 03:51 PM
  #99
TaketheCannoli
RIP
 
TaketheCannoli's Avatar
 
Join Date: Nov 2006
Location: Ohio
Country: United States
Posts: 8,392
vCash: 500
Quote:
Originally Posted by Gump Hasek View Post
I didn't claim to "have access to ticket revenue numbers throughout history" so am unsure of your point; conversely, I did however point out that your use of attendance as a somehow meaningful indicator of forward viability qualifies as extraneous at best. Hope that helps. The balance of your reply here seems a bit of non sequitur as well.

For example, the television ratings in Austin for an unrelated Olympic game is largely irrelevant to an NHL attendance/revenue discussion or for that matter its forward viability as an NHL market - especially given that it isn't one. Let us instead focus instead upon actual NHL markets for this discussion.

You've posted the Olympic game ratings for Columbus already; a more meaningful number however would be if you posted the ratings of the Blue Jackets games instead. Why not post those, and rather than cherry picking and selectively choosing a playoff game, why not just post their raw annual ratings numbers for the regular season, and then post that number up against markets that draw meaningful ratings? That would provide some actual true context to any ratings and or viability discussion as it speaks to viability relative to the group - as their ratings at least imply their ability to generate meaningful local revenue. Raw attendance sans context does not.

Bill Watters claimed when a guest on Prime Time Sports a few weeks ago that Columbus was one of three NHL teams that lost $35 million last season IIRC. If true, that is a number that doesn't seem likely to be cured by a minor increase to their annual league revenue sharing welfare payment... nor by the (realistically) minor improvement to their local lease. I'm guessing their franchise goal is to increase the amount of revenue generated per each ticket sold going forward, just as my analogy initially implied. Good luck.
I have to wonder about a post so full of incorrect information. Is this based upon some discussion you had over a beer with some person who plays fast and loose with facts?

Go research Columbus's ratings compared to the rest of US markets.While you are at it, go research what years they made a profit, what years they lost and how many times they chose to forgo revenue sharing?

If you can't answer those questions, you aren't dealing with relevant data.

I can only assume you didn't actually listen to Bill Watters on Prime Time Sports. I did. I listen to PTS most days. He was on the round-table December 14th.

Here is what he said, "I'm not sure and Damon and John can correct me, but I heard six NHL teams lost an average of $35 million and twelve teams were between break even and losing $20 million.Then eight teams made 300 million combined, but half of that profit was the Leafs."



John, "Eighteen teams lost money."

Bill, "Ok eighteen teams lost money and four broke even.Only eight are profitable. "

Now I generally take anything Watters days with a grain of salt because of statements like that going back to when he co-hosted with McCown 20 years ago, or Leafs Lunch or The Bill Watters Show when they were on 640.


Last edited by TaketheCannoli: 01-05-2013 at 03:58 PM.
TaketheCannoli is offline   Reply With Quote
Old
01-05-2013, 04:00 PM
  #100
Killion
Global Moderator
 
Killion's Avatar
 
Join Date: Feb 2010
Location: Pacific NW
Country: Canada
Posts: 21,249
vCash: 500
Quote:
Originally Posted by Riptide View Post
No it won't be Toronto... but it could easily be a very profitable team in the league down the road. This is actually the one team I really really hope turns things around, and one I think has the most potential to do so, and not only succeed, but thrive.
Absolutely, and Im 110% certain they will. Just some serious dysfunction combined with incompetence, economic meltdown and other factors that's had them reeling and right out of the box. take's a real special breed to mess up NHL hockey in Ohio. Unfortunately, the franchise has employed more than its share. Still recovering from Doug MacLean, the first President/GM who I believe may well be related to Don Waddell. He who did such a masterful job in Atlanta. Now of course MacLean employed by various media outlets in Toronto. Shaping opinion. Just the kinda guy Canadians & enlightened hockey fans everywhere need to be listening to.

Killion is online now   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 03:29 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.