As we have seen in previous posts, Hockey in Canada is well-situated to ride out the lingering economic storm and emerge stronger than ever.... assuming that we, as a hockey nation, resolve the declining participation numbers and address the deplorable lack of a high-level national league.
In the short-term, Canada is funding the failures south of the border. As we've seen, the six Canadian teams contribute 50% of revenues - and most of those dollars go towards propping up failing franchises in Nashville, Phoenix, and, surprisingly, Dallas. And the list of 'walking wounded' US franchises that are barely holding on is long and growing... in fact, we may see the keys to a number of franchises tossed back to the league this upcoming season. The losses were bad last year - but will be nothing compared to this upcoming season.
In the US, the sports world is being rocked by the new fiscal realities that can no longer sustain frivolous spending on non-core pursuits. In most US cities, tickets to an NFL game can be justified - an NHL game, not so much. A league - with an eerily similar profile in the US to the NHL is the Arena Football League.
The AFL - for those who've never seen a game - is tackle football played in a hockey rink on astro-turf. It's a real novelty to most, but a passion to some. Jon Bon Jovi is the owner of the Philadelphia Soul franchise. There's a second division. Teams are good tenants to most NHL owners - and some NHL teams have a vested interest in their success.
The AFL has been in existence for more than 20 years - and has enjoyed cable TV deals with payouts and exposures (ESPN2 standard fare) similar to the NHL. Heck, many of the AFL league execs have ties to the NHL and/or worked for the NHL in the past. The AFL has had a developmental relationship with the NFL - and benefited from plenty of players at affordable rates and some tertiary sponsorships as trickle-down from the NFL.
This week, after taking the 2009 season off as a 'hiatus', AFL ownership will confirm one of the worst-kept secrets in sports... the Arena Football League will cease operations effective immediately. A second tier sport in the US cannot compete for the scarce fan, sponsor and TV/advertiser dollars.... and a second tier sport that spends like a first tier sport is doomed to a similar fate.
Unless steps are taken to re-orient the sport towards market places that are more readily welcoming, markets where you don't need to play 'PIMP MY RINK' to attract attention, or grossly overpay (versus your capacity to earn) your stars because you need the headlines of a big signing and/or your marquee players start expecting the same $$ and treatment.
Markets that do not require expensive white elephants/arenas that have cities like Glendale Arizona having a gun held to its head by proposed new Coyotes owner Jerry Reinsdorf. Haven't heard that one? He wants Glendale to pony up the $23MM in revenues from a new tax - and guarantee to repay the first $15MM/season of losses for five years,.... and if that doesn't work, Reinsdorf is free to move the team, penalty-free?
Or marquee players, with bloated contracts hanging around their necks like albatrosses, being unmoved, unsigned, unloved and unwanted. This is what the sport has come to? Costs spiralling out of control, revenues declining, markets failing (but a blind-eye is turned) - in one country.... and everything is all peachy-keen in the other... heck, rich Canadians are practically throwing their money around, 'making it rain' for the NHL if only they'd take it.
In the US, banking regulators are studying their Canadian counterparts examples, wondering if perhaps a dose of socialized capitalism isn't a bad thing after all. The Canadian banking sector, while not as flush as they were a year or two ago, is in excellent shape compared to its US and international brethren. More oversight in the best interest of all vs. a best-interest-of-me approach helped ensure that the toxic mortgage assets never really reached Canada.... and the devastating impact of the shuttering of Lehman Brothers et al hasn't been felt on Bay Street like it has on Wall Street.
Also, as we 'converse', US authorities are reviewing Canada's health care model, intent on 'borrowing' some of its most critical elements - including a desire to create a true universal health care model. In Canada, no one gets really rich from the system - but everyone gets health care. Kind of like our banks and CEOs.... they get rich, by most peoples' standards, but by Wall Street standards they're in the minor leagues.
So, looking at banking and health care, and understanding that Americans are studying the Canadian model for success, could there be a CANADIAN WAY or model of success for professional, high-level hockey? Up until now, the answer has always been NO - as in, 'No, you can't compete with the NHL'.... or 'No, Canadian cities are too small'.
But what if you created the model for the direct purpose of succeeding in Canada - and Canada alone. Heck, ice-making operational costs would go down in a hurry! Structured the entire Canadian League so that it was purposed with serving the best interests of all, versus the interest of a few, foreign owners.
A Canadian League where you start off at break-even by matching revenues to expenses - and give all the key stakeholders... OWNERS, PLAYERS & FANS... a seat at the table and a say in the decision-making.
If Canadians don't like the American brand of coffee retailer or home products retailer - they have options. Options that are often better tailored to Canadian consumption patterns, habits and needs. The Canadian product just seems to taste a bit better, work a bit better.
The Canadian League would be like that - a product that was just that much more suited to Canadians tastes, needs, aspirations and desires. More outlets closer to more Canadians. More jobs for good young Canadian players. Using hockey and the Canadian League to build connections between Canadian cities so that, in the future, the average young Canadian hockey fan will know more about Regina than Nashville. A NATIONAL RINK, if you will.
Come tomorrow, on www.TheCanadianRevolution.ca, we will unveil the first stage in the plan for the Canadian Hockey Independence. It's a simple plan - but it is really a simple exercise. Because doing nothing will cost Canadians about $2.5B over the next five years - money that will be spent by a League trying to keep a broken business model afloat in markets that have demonstrated their disinterest. And Canada will get less hockey, less jobs in the process.
As we said, Hockey in Canada is in strong shape - and perhaps, what's really needed is a dose of Canadian ingenuity combined with our usual 'all-for-one' approach. That sounds to us like a real PLAN EH!
More tomorrow.
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