Hockey and Slot Machines?

The NHL has begun the process of looking into potential expansion opportunities for a 31 or 32 team league. Currently, the unofficial, front runner is a team in Las Vegas, exactly, a hockey town. The ownership group has constructed an area with 17,500 seats and pre-sold 13,200 refundable seasons tickets to test the market. This has all been discussed with the NHL, with approval, yet no official commitment about a team being awarded. The cost of the expansion franchise is estimated to be $500 Million dollars, all paid to the existing 30 owners. The other expected long-shot for a team is an ownership group in Quebec. An arena is already constructed and the group meets the steep capital requirements set forth by the NHL, however due to a crowded eastern conference and a canadian area code, it is expected that they will not be successful in their bid.

The NHL is a powerful brand in Canada, with success in every Canadian Market, yet it appears that the main focus of the Commissioner is building the Brand in the US. Prior to the formal application process opening for expansion the NHL has spent considerable time reviewing the potential of the viability of the Las Vegas market by allowing the ticket pre-sales and hosting the last two NHL awards in the city.  This season has been difficult for the NHL with significant attention being put on the lack of viewers and significant cost paid by the Rogers media group for the television rights to distribute games. The last thing the NHL wants is another american expansion team failure to tarnish its reputation.

Anthony Mantecon

http://www.theglobeandmail.com/sports/hockey/nhl-board-approves-opening-formal-expansion-process-source-says/article25097219/

4 thoughts on “Hockey and Slot Machines?

  1. Hi Anthony,
    My hunch is that the big brands like the Leafs and Habs that are bringing in all the cash for the NHL profit sharing have a big say in what goes on near their markets. What I am missing though is what do they really have over the NHL? If another team comes to these hot Eastern markets of GTA and Quebec, what would be the downside? It is not like these teams can do anything about it, and you know the consumer base already exists here…Looking at it from a pure business perspective it doesn’t make any sense, and to your point a failure might actually hurt the NHL brand. There must be something else going on…I doubt Bettman’s passion for growth in the US is the pure driving force…
    James LaJoie

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  2. Hi James –
    Thanks for commenting, I think a big part of the issue with crowding the GTA market would be the viability of the team with the transfer payments required to Buffalo and Toronto, the issue with the Quebec team is the crowded eastern conference. Bettman is trying to add teams out west. Based on the NHL expansion in recent years, it appears that Bettman is trying to grow the game in the US market. I’m not against adding a team to the Las Vegas market, however, I think the city already has huge competition for the consumer dollar.

    Anthony Mantecon

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  3. I personally believe that the Rogers Partnership has actually damaged the NHL brand. Many people are not pleased with something they love so much becoming so closely aligned with a company that is not liked this much. When I worked for Rogers, many customers I spoke with voiced disapproval, and I believe this has potential to damage the NHL brand which has been gaining revenue lately.

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