April 20, 2015
Playoff Time For The NHL
It’s playoff time for professional hockey, and NHL officials are hoping for some major ratings. Despite the fast pace, interesting personalities, and cool culture, hockey still lags behind several other sports in the hearts and minds – and wallets – of many Americans. While the NFL and MLB fight for the top spots in sports marketing, the NHL, and the NBA both want to be number three. And both have been rocked by lockouts, work stoppages, and other issues in recent years.
Back in 2012 the NHL experienced a work stoppage – it’s fourth in 20 years – based on how to split the approximately $3.3 billion in revenue. Since then hockey has tried to bounce back, but it faces some of the same issues that caused the previous disputes. Mainly, the massive disparity in brand popularity. Ask any fairly attuned American sports fan, and they could likely name three or four NHL franchises. Ask for ten, and the numbers would thin. Name them all? Forget about it. And the revenue numbers back up this disinterest. During the season prior to the most recent lockout, 18 of the 30 NHL teams lost money.
A few managed to scrape together a meager profit, but the three tops teams in the league practically printed money. The Maple Leafs, Rangers, and Canadiens enjoyed huge operating profits or more than $170 million. The other 27 teams, combined, only managed $44 million. The Canucks and Oilers bring the profit tally up to $212 million. Without these five teams, the total revenue is a loss of more than $86 million.
While the top teams in the NFL make huge margins, they only represent a third of all league profits. The NHL situation is mirrored by the NBA, where the Bulls and Knicks regularly pull the majority of the freight for the league. However, subsequent to the NBA’s most recent collective bargaining agreement, the league tripled revenue sharing to keep small market teams in the black. But the NHL has struggled to reach that level of cost-sharing parity.
The only other solution is to bring in a lot more paying fans to each and every “on the bubble” NHL team. There will always be a few that struggle, but some of the better teams can charge into the playoffs with the opportunity to bring in fans that will stick around, at least for a while. Without that bump, the NHL will have to go back to the negotiating table sooner rather than later.