Wednesday, February 4, 2009
Kotz / Sports Are the Nashville Predators in Financial Trouble Again?
Posted by Pete Kotz on Wed, Feb 4, 2009 at 12:00 PM
It's of little doubt the NHL's southern expansion has been a disaster. The league thought it could push a regional sport on areas with no hockey tradition--at the same time it reduced fighting, which tended to be its gateway to new fans. So teams in Atlanta, Miami, Tampa and Phoenix have languished for years. Add in a wretched economy, and you have the recipe for a multi-million dollar fiasco.
Some of this is simply due to bad management or substandard arenas. It's no coincidence that the roster of financially troubled teams have also built a tradition of sucking on the ice. But since few wealthy people want to buy into hockey, and there's few northern markets left to house relocated teams, don't be surprised if the NHL is forced to kill off its weaker siblings. And one may well be the Predators, says the Sun...
"The team can't score on the ice, or with fans. Management revealed it considered buying thousands of unsold tickets so it can qualify for a full share of the NHL's revenue sharing plan. Through 22 home games, the Predators' average paid attendance was 256 tickets short of the 14,000 average required for a full share of the revenue-sharing pool that netted the team $12 million last season.The plan gives small-market clubs money that the NHL collects from the 10 highest-earning teams. The amount franchises receive falls if certain attendance figures aren't achieved.
Predators lead owner David Freeman made an estimated $50 million selling a medical waste disposal business. So, when it comes to waste you'd think an expert like Freeman would recognize it even if it was disguised as a hockey team. But, he says his reputation as a businessman is at stake, and he wants to make hockey work here. So, as for Jim Balsillie buying and moving the team?
"There is no Plan B," Freeman said.
Comments (10)
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Canadian papers root for the total destruction of Sun Belt hockey. But the Predators are at parity with Quebec Nordiques attendance figures, and the Winnipeg Jets drew far worse than the Preds.
The core Predators fan base, mostly season ticket holders, is a good hockey crowd, but it's not growing, and as people look to cut their entertainment budgets, single game hockey tickets are one of the first things to go. Get this, though: that's the way it is throughout the NHL. The only teams to move against the economic tide are the ones who were terrible and have improved dramatically, which is a natural occurance-- fewer people go to watch crappy teams. The Blackhawks are example A.
Fact of the matter is, pro sports in general are in a world of hurt right now. No amount of contraction is going to save that.
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You're right, DG, in that Canadians universally hate Commissioner Gary Bettman, and southern expansion is seen as his thing. But I don't know if I'd point to Quebec and Winnipeg for my argument. Neither have NHL teams anymore for precisely the same attendance problems the Preds are having now.
The troubling part is that the salary cap hasn't fixed these problems for the bottom revenue teams. And it's one thing for Chicago's attendance to rise when the Hawks finally get good. It's a traditional hockey town. I wonder if Nashville or Atlanta would support a team even if they had regular playoff teams. Tampa won the Cup a few years ago, and it's still having problems. It could just be that hockey is to the south what soccer is to America. It just won't play.
Part of the problem is expansion in general. There are too many teams in the top flight of just about all of our North American sports leagues. We should adopt a relegation/promotion system modeled after European soccer. This gives the Saginaw Gears and Moose Jaw Manitobans a chance at competing for a coveted NHL slot, while teams that consistently sh*t the bed are forced down. Natural order is maintained as a result.
Nashville would make a fine AHL city, with dreams of promotion back up top.
Pancho,
I'm a soccer nut (by the way, there's a world cup qualifier between the USA and Trinidad and Tobago at LP Field on April 1, and it's a freakin' big deal so everybody ought to be there), and I'm all for a promotion and relegation system in all professional sports.
Kotz,
I understand where you're coming from, but the attendances in Raleigh for the Carolina Hurricanes (RIP, the Whale) have corresponded closely with the team's success. Maybe the difference between being a #8 playoff qualifier and finishing 12th in your division don't amount to as much in non-traditional hockey markets and the Original Six cities, but being a Stanley Cup winner or legitimate contender without a doubt provides a huge boost at the gates.
Now every team can't be a Stanley Cup winner, but somebody has to win, and at the same time, someone has to be a low playoff seed and someone else has to be complete crap, and that corresponds to ticket sales to varying degrees. Only in Toronto do people pay top dollar for garbage hockey. You can't clone Toronto. Even hockey-crazed Buffalo has seen its number of sellouts decline since they allowed their best offensive and defensive players to leave. Yeah, Chicago is doing better at the gate now that they're a young, exciting team who win games than Nashville would, but the difference isn't that immense.
If the average crowd in Nashville were half that of the top quartile, I'd say that contraction would make sense. But my gut feeling is that relocation would just be shuffling the deck, and contraction wouldn't save enough money to make up for losses resulting from the decline in the NHL's footprint.
This stuff comes straight from the Canadian sports media and a few Original Six hockey snobs. Things aren't ideal, but there isn't a meaningfully better plan.
You're probably right about relocation, DG. Seattle just lost its basketball team because the city wouldn't build a new arena, Toronto and Buffalo will never let Hamilton happen, and Kansas City just seems like a dumb idea. It already lost one team, it's not that big, it's not that wealthy, and it isn't a traditional hockey town. All it has going is a new arena.
But I wouldn't rule out contraction. Baseball even considered it a few years back. The problem is the NHL wouldn't have the money to buy back the teams. Owners would probably prefer to see Nashville go belly up before they pooled together a billion dollars to buy the underperformers of the south.
But you do see the economics moving away from the newer teams. I don't know if you watch the games on Versus, but they almost exclusively air games for northern markets. I don't think I've seen a southern or western team on all year, save for maybe Dallas. They've learned from the mistakes of ESPN2--you just can't sell advertisers on telecasts from Miami or Los Angeles.
You're making a big mistake looking to the Toronto Sun for an informed analysis of the situation; it's widely regarded as a garbage tabloid, and the writer is pandering to an audience up there that is still stung by the loss of the Jets & Nordiques.
Paid attendance is up this year, they should hit the magic 14K mark without owners having to open their wallets, and progress is being made. This ain't Toronto or Montreal... no kidding!
What a strange article. Quoting the Sun is almost like quoting the National Inquirer. On top of that, the Preds just announced that attendance is expected to be up 6% and they will turn a profit (albeit a small one)in the most devastating economy in North America in the last 70+ years. Compare that to the expected losses in other markets and the historical loss in this market and it would appear this is a franchise very much moving in the right direction. Add to that the changing dynamics of the Canadian exchange rate that could threaten the fortunes of Canadian teams again in the near future and this adds up to a weak article with a very, very misleading headline.
Pete Kotz says:
"...and Kansas City just seems like a dumb idea. It already lost one team, it's not that big, it's not that wealthy, and it isn't a traditional hockey town. All it has going is a new arena. "
First, let me make it clear that I live in Kansas City but was a college student in Nashville when the Preds came into existence. I am a huge Preds fan but have mixed emotions about the Preds relocating to KC, although another team's relocation would be nice.
On your first point that KC has lost a team already... well, I can't argue with that. We did loose the KC Scouts back in the '70s. But that particular team was very poorly managed and promoted. They relocated to Denver and failed there as well before finally succeeding in New Jersey... But the Avalanche has succeeded. Should we have excluded Denver from getting a second crack at the NHL based on the failure of their first team?
Kansas City isn't that big? This is news to me... Kansas City's metropolitan area is home to just over Two Million... compared to Nashville's 1.5 Million.
For comparison, Kansas City has a greater population than each of these NHL Cities (based on Metropolitan Statistical Area):
Columbus - 1.9 Million
Raleigh-Durham-Cary (Carolina) - 1.6 Million
Nashville - 1.5 Million
Buffalo - 1.5 Million (incl. Niagara, Canada)
Ottawa - 1.2 Million
Calgary - 1.2 Million
Edmonton - 1.0 Million
On the wealth concerns... Johnson County, Kansas (pop 516,000), the largest of our suburban counties, is the 19th richest county in the nation by Median Household income... just ahead of Williamson county (pop 153,000)
I will concede the point that Nashville would have more corporate support due to the larger number of corporate Headquarters in the Metro area as compared to KC... although all of our suites are sold, even without a team.
As a person who lives in Kansas City it would be really cool to have a hockey team but frankly, I would never go to see it. People in Kansas City just don't follow hockey, and that's the main problem with expansion/relocation into southern cities, people in these cities just don't know anything about hockey. Americans who don't live up North grow up on football, basketball, and baseball. Unless you can win quickly (Dallas or Anaheim) you aren't going to be able to pull people in fast enough before you start having financial problems. It's like when the NBA had an expansion team in Vancouver and MLB had the Montreal Expos. As soon as those teams started the falter people in those cities stopped caring and only came back during unusually productive seasons. It's really hard to grow a palm tree in Saskatchewan, and the same can be true of hockey below the Mason-Dixon line. Yes a few Canadian hockey teams have had problems in the past, but that had little to do with fan support. People in Canada actually care about hockey, they're rabid about it because it's their national sport. Regardless of anything else putting a team in a city in which fans will care is a lot better for your league than putting teams in bigger cities where their is more money but no one knows anything about hockey. Sure there are a few people in these southern NHL cities who really know and love hockey, but can you look me straight in the eye and tell me that there are more diehard hockey fans in Nashville than in Hamilton? As a sports fan in general I would love to see every team from the American south moved to Canada, because having a hockey team in Miami where ponds won't even freeze over in the winter sounds and is ridiculous.
To say that no one in Kansas City follows hockey is just wrong. Of the US markets that do not have an NHL Fanchise, Kansas City has the highest NHL viewership.
Also, to hold the Scouts' move to Denver some 35 years ago against KC makes no sense either. You have to realize that the KC metro area is now almost twice the size it was some 35 years ago when the Scouts left. Couple that with the fact that when the Scouts were here, Kansas city was the smallest market to have all four major league sports. They had to compete directly with the Kings of the NBA. There is no competition for the winter sports dollar in Kansas City now.
