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Saturday, December 11, 2021

This week’s purchase of the New Orleans Hornets by the National Basketball Association is the third such franchise-buyback in recent memory:

- The Phoenix Coyotes were bought out of bankruptcy by the National Hockey League last year; they’re still owned by the league, although a sale to Matthew Hulsizer seems imminent.

- Back in 2002, Major League Baseball bought the Montreal Expos, a prelude to eventually selling the team to investors who re-launched the franchise as the Washington Nationals.

Are we seeing a trend? Each of these buybacks were defensive, last-resort moves. Contraction was mentioned in each instance, and is being bandied about by the NBA even now (although more as sabre-rattling versus its upcoming collective bargaining fight with its players union). While brand value and product integrity are important enough for the NHL, NBA, and MLB to persuade member owners to contribute money to pool together such troubled-team buybacks, you have to wonder when owners will get tired of footing such bills.

Oh, and the missing major-pro league here? The National Football League, of course. The NFL has yet to experience a situation where a franchise couldn’t attract eager buyers. That doesn’t translate into stability — teams have switched cities a lot, the Los Angeles vacancy is an ongoing issue, and the looming player lockout could dent a few franchises. But to this point, it’s telling that the NFL hasn’t had to engage in such bailouts.

by Costa Tsiokos, Sat 12/11/2021 05:45pm
Category: Baseball, Basketball, Football, Hockey, SportsBiz
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Monday, September 06, 2021

labor daze
In observance of Labor Day today, I figured I’d take a brief look at a couple of notable developments during this National Hockey League offseason, as they relate to the free-agent market:

- Most immediately, the Ilya Kovalchuk contract controversy, which precipitated the addition of a major amendment in the collective bargaining to address similar long-term pacts in the future:

First: For long-term contracts extending beyond the age of 40, the contract’s average annual value for the years up to and including 40, are calculated by dividing total value in those years by the number of years up to and including 40. Then for the years covering ages 41 and beyond, the cap charge in each year is equal to the value of the contract in that year…

Secondly, for long-term contracts that include years in which the player is 36, 37, 38, 39 and 40; the amount used for purposes of calculating his average annual value is a minimum of $1 million in each of those years (even if his actual compensation is less during those seasons).

Somewhat convoluted, but essentially, the league is aiming to discourage using the downside of a player’s career as “voidable years” in a front-loaded contract. The presumption has been that, after the player has gotten the bulk of his money in the first few years, he’ll be more inclined to retire or consent to a buyout when the latter portion of the deal kicks in. That would work out for the team as well, as it can work with a lower averaged-out cap number during that player’s most productive seasons, and save a little money further down the line (while not worrying about the future accelerated salary cap hit if the contract is eventually terminated). But now, these new age-specific rules prevent too much stretching-out of the total compensation — basically, contract length can’t really be used as a bidding tactic anymore.

So, barring the discovery of a new loophole, this will mean shorter-length contracts in general in the NHL, for the remainder of this CBA. Annual salaries/cap hits may not correspondingly decrease, although with the smaller window of averaged-out seasons in play, teams will have less room to bid against each other for sought-after players.

The advent of these super-sized contracts was an interesting response to the unique constraints imposed by the NHL’s CBA: A hard salary cap combined with guaranteed contracts. Using contract length as an outlet to level out the per-season cap hit has been used in the NFL since the inauguration of true free agency in that league. The key there, though, was that those player contracts are not guaranteed. Football teams have operated freely by luring prized free agents with long-term big-money deals that easily fit under the NFL hard cap, because the long-term impact could be instantly negated by cutting the player after one or two seasons (again, ignoring the acceleration penalties, which are mostly manageable). In turn, football players learned to negotiate massively front-loaded deals, usually with half or more of the total contract value payable upon signing and/or in the first season; the rest of the contract years are presumed to be optional.

That’s just what the NHL’s “voidable years” emulated. Realistically, you know that most players hit their downside by their mid-30s, so extending a contract into those iffy years was a low-risk proposition. It was obviously cap-circumventing too, so it’s not surprising that the league finally eliminated it (or, at least, made it less workable).

- From Kovalchuk’s 15-year deal, we go to the other end of the spectrum: An apparent increased frequency in extremely short-term deals. A rundown of CapGeek’s free-agent tracker reveals a total of 385 players signing one- or two-year contracts for the coming 2010-11 NHL season (as of this writing). With only 420 players having agreed to free-agent or contract-extension deals this offseason, this points to an extremely soft free-agent market.

But why? Granted, in any given year, there are only a handful of major in-demand free agents to be had, and they generally get scooped up early with big paydays. After that, second-tier players take what’s left, competing for a limited number of roster holes.

Still, I can’t remember the last time so many proven NHL players had to settle for so little. The preponderance of one-year contracts, in particular, brings to my mind the grand strategy of Oakland A’s owner Charlie Finley, at the dawn of Major League Baseball free agency:

Said Finley: “Let Them All Become Free Agents.” What Finley proposed was that after each season every player would become a free agent, free to sign with whatever team wanted his services.

The idea was that, with such a huge pool of talent available each offseason, teams would have far more options, thus driving down the value for each individual player — and this would be the case every year. Certainly, specific needs would lead to some bidding wars: If Team A and Team B really needed a good shortstop, they’d probably target the same couple of players and drive up the signing price. But with no contracts lasting longer than a season, the damage would be short-lived.

In effect, that seems to be what’s being set up for next offseason in the NHL, with most of those players coming loose again (except for a handful that might earn contract extensions). Any time such a large-scale work-status shift materializes in major-pro sports, whispers of collusion surface. They haven’t this time — yet. I’m not sure the owners are conspiring in this case. But it definitely is curious that a flood of the same players will be on the market in 2011, guaranteeing that they won’t be able to command better money/terms than they had last time around.

Overall, it’s been an interesting round of labor pains for the NHL this summer. We’ll see how all this manifests itself when the regular season starts in a month.

by Costa Tsiokos, Mon 09/06/2021 11:00pm
Category: Baseball, Football, History, Hockey, SportsBiz
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Saturday, August 28, 2021

devilish by division
I’ve been avoiding making any comment on the whole Ilya Kovalchuk contract controversy, mainly because I’d like to see the situation finally resolved before I weigh in.

The resolution is now is sight, as the New Jersey Devils submitted a reworked, and presumably salary-cap-compliant, deal to the NHL yesterday. Hopefully the league will approve this pact, if for no other reason than the franchise-appropriate way that the numbers average out:

Terms of the potential contract have yet to be released but it is believed to be a 15-year deal worth approximately $100 million, which in an amusing twist would make the cap hit $6.66 million a season.

Apparently, neither the Devils nor Kovalchuk suffer from hexakosioihexekontahexaphobia. And this hurts the team’s persistent insistence that its name isn’t inspired by Satan, but rather the legendary Jersey Devil. (Although, if they were truly up on their Christian theology, they’d have gone for a cap hit of $6.16-mil, which would represent the more accurate mark of the Beast.)

This numerological chicanery is nothing new for the Devils, of course. This is the same franchise that used to fudge their arena capacity just to keep the old anti-Rangers “19-40″ chant alive. It’s hockey marketing via calculator…

by Costa Tsiokos, Sat 08/28/2010 12:05pm
Category: History, Hockey, SportsBiz
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Thursday, July 08, 2021

More than a year ago, we were expecting future sports-transaction news to be delivered directly from the players, via social media outlets like Twitter and Facebook.

But when you’re LeBron James, and you’re the preeminent free agent of this 2010 National Basketball Association offseason… Well, why settle for a measly Twitter account when ESPN will give you an hour of airtime to announce “The Decision”?

Sources told ESPN The Magazine’s Chris Broussard that representatives for James contacted the network, proposing the idea of a dedicated special. The sources said James’ representatives requested they be allowed to sell sponsorship for the broadcast, and ESPN agreed.

“Due to the unprecedented attention and interest surrounding LeBron’s decision, we have decided to make this announcement on national television,” James’ business manager, Maverick Carter, said on lebronjames.com.

Old media trumps new media once again, when it comes to the monumental events. And indeed, James announced his choice of the Miami Heat tonight, a moment that was blunted only slightly by the leaks earlier that indicated he had decided on south Florida.

Considering how commoditized other aspects of sports business have become, having a marquee player build a television special (really, an advertising vehicle) around his contract signing is a natural. The NFL Draft is a major offseason viewing event, and “free agent frenzy” coverage is a major staple in all major-pro sports media (including college signing days and the like). Since the audience interest continues to grow, we can expect future dedicated event coverage like this, stemming from the players or the teams/leagues. It’s a significant step in that a player like James now commands enough clout to control the message so thoroughly, and on an enviable national-broadcasting stage.

The only thing, regarding James’ @kingjames Twitter handle: Typical of many celebrity accounts, he’s amassed a few hundred thousand followers while following nobody. A deft move, simultaneous with James’ live announcement on ESPN, would have been that zero-following changing to a 1 — with that one being the team he finally chose. Perfect orchestration, and a nod to the online fanbase. Maybe for the next mega-free agent circus, next NBA offseason.

by Costa Tsiokos, Thu 07/08/2021 11:54pm
Category: Basketball, Social Media Online, SportsBiz, TV
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Tuesday, June 01, 2021

My previous concern over this past weekend’s Stanley Cup Final schedule on NBC seemed unfounded. By the numbers, Game 1 and Game 2 turned in great ratings, with a 2.8 and 4.1 share respectively.

So I guess back-to-back Saturday-Sunday championship games aren’t essential for National Hockey League viewership. Then again, it’s important to remember the context:

We’re talking about the No. 3 and No. 4 TV markets in the U.S. facing off in this series. The local viewership is fueling these ratings, much like it did for the last two finals between the Detroit Red Wings and Pittsburgh Penguins, and much like it does for the NHL’s regular-season games on NBC.

It’s a dangerous game for the NHL: It’s impressive how hockey can dominate big media markets during special events (Stanley Cup Finals, Winter Classic), but what happens when a Canadian team sneaks back into the championship round? Or an American team that isn’t from the Original Six or a strong Northern market?

Not that I think it’s worth worrying about non-marquee teams making it to Cup contention. Excepting the Super Bowl, every sport plays that “dangerous game” of the potential ratings hit from the championship round suffering smaller-market teams. That’s where the marketing (particularly player-focused marketing) should kick in.

Still, that 4.1 is impressive enough. It’s still on the low end of comparable NBA or MLB final-round coverage, but at least it shows that prime-time televised hockey has a pulse.

by Costa Tsiokos, Tue 06/01/2021 11:41pm
Category: Hockey, SportsBiz, TV
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Monday, May 24, 2021

for openers
This year’s National Hockey League Stanley Cup Final will have the Chicago Blackhawks and the Philadelphia Flyers. What it won’t have is a repeat of last year’s Saturday-Sunday scheduling of Games 1 and 2 on NBC. Instead, this Saturday’s Game 1 will be followed by Game 2 on Monday, setting the pattern for an every-other-day series.

I’m not sure why the Peacock Network is forgoing 2009′s Stanley Cup Weekend format. After all, it was a solid ratings success last year, and I thought it keyed viewership for that entire series:

You can debate how successful that would have been for NBC had it been, say, Columbus versus Florida. But I’m convinced that it’s the right way to kick off the showcase series of the playoffs: No opening-night pomp, followed by a day or two off for casual viewers to promptly forget about the whole thing. Saturday night served as the lead-in for a returning audience on Sunday, and the ratings momentum remained sustained from there, right through to Game 7’s breakthrough. So that two-game opener schedule will remain in place next year (and beyond).

So much for “remaining in place”. There’s nothing on NBC this Sunday in primetime that would prevent a hockey game from breaking out on network air. The only thing I can figure: Game 7 of the NBA Eastern Conference Final is scheduled on another network. Perhaps the TV folks still aren’t confident that the NHL can top the hoopsters when going head-to-head.

Still, a Saturday night Game 1 between two of the more iconic American hockey cities should provide something of a boost. And Monday will still be part of the Memorial Day extended holiday weekend. So who knows? Maybe a ratings boost will fall into the league’s lap this year without the back-to-back backing.

by Costa Tsiokos, Mon 05/24/2010 11:09pm
Category: Hockey, SportsBiz, TV
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Tuesday, May 11, 2021

The next time that a big-league sports franchise owner bleats about how much money he’s supposedly losing, keep in mind this statement from Ted Leonsis, the soon-to-be king of the Washington-Baltimore sports market:

“Obviously when you control two major-league teams in a four-team market, and both winter teams, you’re thinking about bringing all that together.” And [sport-business executive Steve Greenberg] was mindful of the way sports franchises have performed as investments; barring mismanagement, they only go up. To which Leonsis, who was among the largest private owners of AOL stock before its ill-advised merger with Time Warner, can attest: “I don’t have a single investment that performed as well or better in the last 10 years than my sports teams,” he says.

Bingo. The two teams in question are the NBA Washington Wizards and NHL Washington Capitals. And the dollar value only goes up in baseball and football. So much for the perpetual poverty claims of the sports moguls.

by Costa Tsiokos, Tue 05/11/2021 11:53pm
Category: Basketball, Hockey, SportsBiz
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Friday, March 19, 2021

Has the Great Recession put some truth to big-league sports owners’ perpetual claims of red ink? Recent and pending franchise sales among the Big Four team sports point to lower valuations:

For decades, sports teams weathered recessions remarkably well. Ticket and advertising sales sometimes dipped, but teams continued to sell at a profit despite the headwinds buffeting the broader economy, according to research by Moag & Company, which brokers sales of teams.

But John Moag, the company’s chairman, said this recession had been drastically different. “The impact of the stock and real estate devaluation on franchise ownership is indirectly, but very certainly, impacting the stability of a number of professional sports franchises,” he said.

Real estate is the main factor here. The simplest equation for assessing the value of an NFL, NHL, MLB, or NBA team is the property that comes with it — and that doesn’t refer to the players or equipment. For operational purposes, major-league sports franchises are intertwined with the stadium/arena facilities in which the teams plays. If the barn’s value takes a hit — and commercial real estate has, indeed, been buffeted during this economic crisis — then it follows that the entire business entity, including the franchise, will also get downgraded. And in keeping with this level of integration, any team sale will include the arena (even if it’s a nominal “lease” which effectively gives the team owner control of and revenue from the facility). Add it all up, and team valuations that were approaching $1 billion a couple of yeas ago are now falling back (a bit).

While this impacts highly-leveraged owners, who suddenly have to come up with more hard cash, it doesn’t mean a sudden flood of red ink is flowing out of the big leagues. Team valuations are still healthy, with premier franchises like the Chicago Cubs and Montreal Canadiens commanding anywhere from half- to three-quarters of a billion dollars. And despite the ravages of the current market, the key to sports-team ownership remain enticing: Gaining access to prime, often scarce commercial property that generates tons of money. The revenue levels involved are still sky-high enough to make the usual cries of ownership poverty as hollow as they ever were (especially as they start to roll in during the NFL’s and NBA’s forthcoming labor negotiations).

by Costa Tsiokos, Fri 03/19/2010 11:16am
Category: Business, Sports, SportsBiz
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Friday, January 01, 2021

Along with catching a corker of a Winter Classic today — a thriller in which the Bruins rallied with two sweet tic-tac-toe passes to beat Philadelphia 2-1 in OT at Fenway Park — I noticed a distinct improvement in the quality of the game’s televised commercials this year. Instead of endless replays of generic national ads, sponsors like GEICO and Verizon Wireless created customized hockey-themed spots that actually looked good. A couple of those spots even feature star players like Sidney Crosby and Alex Ovechkin, thus highlighting the league’s most marketable assets.

Why the sudden boost in dedicated advertising for a hockey game? Because, improbably enough, the WC really has become the NHL’s showcase event:

In the past three years, the league’s corporate advertising revenue has jumped 66 percent and the Winter Classic is at the heart of that leap. Sports Business Daily recently reported that sports business executives ranked the Winter Classic fifth among major sporting events they were looking forward to in 2010, ahead of sporting staples like the BCS National Championship, the World Series, the Masters and the Daytona 500. The survey was taken in December and included reports from more than 1,100 senior-level sports professionals.

That’s the money people talking, which explains why extra marketing dollars went into today’s TV ads. Doubtless they’ve noticed the rising viewership:

The Classic has become a surprise TV hit, occupying the 1 p.m. Eastern time slot against three college bowl games (the Outback at 11 a.m. and the Gator and the Capital One at 1 p.m.). In 2008, an average of 3.75 million viewers watched on NBC, which was exceeded last New Year’s Day with a 17 percent jump to 4.4 million, the most-viewed regular-season N.H.L. game in 34 years. Nearly 1.3 million more watched it in Canada.

Pucks beating out baseball, college football, and NASCAR? I’m an unabashed hockey fan, and even I can’t believe it. A lot of this is due to the novelty of the New Year’s Day game, which is only in its third year; will the mindshare still be there ten years from now? Still, the success of the Winter Classic rightly stands out as a rare marketing homerun for a league that traditionally can’t promote its way out of a paper bag.

by Costa Tsiokos, Fri 01/01/2021 06:32pm
Category: Advert./Mktg., Hockey, SportsBiz, TV
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Thursday, November 19, 2021

bowled over
To the extent that the National Football League is an economic barometer, the early land-grab on Super Bowl XLIV adspace suggests a recovery is well-underway:

Months away from the biggest football game of the year, CBS is already nearing a 90% sellout for advertising spots during the game. The network expects to close enough deals to hit that mark before Thanksgiving, said John Bogusz, CBS’s vice president of sports sales and marketing…

For last season’s big match, NBC didn’t reach the 90% benchmark for sales until January, just a month ahead of the telecast.

The pricetag for a 30-second spot hasn’t hit the previous high of $3-million yet, so maybe the relative bargain is prompting the big buy-in. Also, all those consumer-goods producers doubtless have loads of inventory to move, after the Great Recession chilled most folks’ discretionary spending. The confluence makes for a desperate situation, which I’m sure the NFL is glad to remedy.

by Costa Tsiokos, Thu 11/19/2009 11:57pm
Category: Football, SportsBiz, TV
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Saturday, August 22, 2021

how 'bout them scoreboards
The Dallas Cowboys just spent $1.2 billion on their brand-new stadium, and somehow didn’t factor in the vertical leg-strength of the average National Football League punter. How else to explain the placement of Cowboys Stadium’s massive 2,100-inch high-definition video screen cluster so low off the ceiling that it could conceivably get in the way of gametime punts?

“It’s nothing that is going to happen every time, but it’s there and it’s got to be addressed,” [Tennessee Titans punter A.J.] Trapasso said. “I don’t know how much further up it can go, but it’s in the way.”

[Cowboys punter] Mat McBriar said that he thinks a punt with a hangtime of 4.9 seconds — good, but something that happens every NFL Sunday — could hit the Jerrytron. However, McBriar won’t be pleased if he hits the scoreboard this season, because that would mean he failed to properly place the ball.

Fat chance that ‘Pokes owner Jerry Jones can get that monstrosity raised higher in time for the regular season, even if he wanted to (his arrogance is preventing him from admitting to this boneheaded flaw). The NFL rulebook is treating this potential obstruction as do-over territory, so if it happens during a game that counts, it’ll simply require replaying that down (just like they did in the stadium’s preseason christening last night). Here’s hoping that a situation occurs where a re-punt costs Dallas a critical victory during 2009. It’ll serve them right.

Look for Jones to push the league to automatically suspend any opposing punter who has the temerity to send a pigskin into the jumbo-monitor. Not so much because it would affect the flow of the game, but because every such hit would re-highlight this massive boner…

And to reiterate: It’s simply mind-boggling that a major-pro team can sink so much into erecting a to-the-spec facility, and then cut corners on fundamentals that directly impact the featured product, i.e. football games. Of course, the host city of Arlington, Texas paid almost half the construction costs; maybe if Jones and the Cowboys had had to pay for the whole thing, they might have been a little more thorough.

by Costa Tsiokos, Sat 08/22/2009 02:22pm
Category: Football, SportsBiz
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Thursday, July 02, 2021

Yesterday was the commencement of the formal free-agency signing period in the National Hockey League, and it went off with a bang: A record number of players switched teams, with the usual long-term dollars committed with an eye toward salary-cap impact.

The detailed rundown is available from here to ESPN.com. Here are a few of the more notable player- and team-based developments from the first day of “Free Agent Frenzy”:

- Perhaps reflecting their state government’s fiscal paralysis, all three California clubs were unusually quiet. Not counting the Ducks and Sharks re-signing a couple of their own restricted and unrestricted free agents (notably Scott Niedermayer for Anaheim, along with their previous Draft-day trading of Chris Pronger to Philadelphia), those teams and the Kings made no moves at all. The inactivity was especially puzzling for LA and San Jose, who were both expected to revamp their rosters after disappointing 2008-09 seasons. Both teams are rumored trade-partner possibilities for disguntled Ottawa winger Dany Heatley, but otherwise, it looks like they’ll be picking from the second-wave UFA crop.

- The Habs made waves with their signings and trades, basically foregoing size for skill. This has set up Montreal for considerable ridicule for assembling a forward corps that averages something like 5’9″/170lbs (exaggeration, but not by much). I’d like to take an early stab at nicknaming this shrimpy group of Scott Gomez, Mike Cammalleri, and Brian Gionta: The Smurfs, hearkening to the common term for short-but-steady NFL receivers.

- Based on recent performance, it seems like the Oilers have upgraded in goal with Nik Khabibulin. However, his history indicates that he doesn’t elevate his game unless he’s got serious competition from his backup: That was the case last season in Chicago with Cristobal Huet, and similarly during his Tampa Bay tenure when John Grahame pushed him. Will youngster Jeff Drouin-Deslauriers be able to challenge for the starter’s role enough to keep Khabi on his toes? For four years? Doubtful.

- And speaking of the goaltenders… I’m really surprised that Scott Clemmensen couldn’t capitalize on his stellar substitute stint with New Jersey this year — to me, it validated his starter status. In fact, I was expecting Colorado to nab him and slide him into their vacant No. 1 slot. Instead, the Avs picked up journeyman Craig Anderson, and Clemmensen ended up replacing Anderson as Florida‘s new backup behind Tomas Vokoun.

- There was a lot of grousing over several injury-prone players landing multi-year contract. In particular, Minnesota got flack for replacing one fragile winger — Marian Gaborik — with another in Martin Havlat. I would add that the nature of those long-term deals means that many of these players are going to become injury-prone if they’re not already. In addition, the Lightning seemed to get a free pass on this issue when they picked up Mattias Ohlund, who’s spent significant time on the IR during his career.

- On the local NHL front: The Rangers obviously made the most noise, with the preliminary salary-shedding of Scott Gomez to Montreal setting them up for the $37.5-million landing of Gaborik. Adding brawler Donald Brashear will also amp the excitement level at MSG. Comparatively, the Devils and Islanders laid low, notwithstanding New Jersey’s significant re-signing of their incumbent d-men Johnny Oduya and Andy Greene.

- Finally, I’m a little irked over the loose talk about the “cap hit” for each announced signing. In most cases, the dollar figures cited by TSN, Puck Daddy, et al are nothing but the simple per-year average of a contract, arrived at by simple arithmetic. Problem is, most of these big-money deals are either front-loaded or back-loaded, so the true cap hit in any given year is far away from the per-year average.

For instance, Marian Hossa’s trumpeted 12-year, $62.8-million contract with Chicago averages out to $5.23 million — except that it doesn’t. The reported front-loaded deal pays Hossa $7.9 million each season from 2009 through 2016, with declining annual salaries after that (making the older Hossa easier to trade or buy out by that point). Obviously, the Blackhawks carry a significantly higher salary cap figure for the winger in the immediate term than if the total sixty-two mil were more equitably spread out over the contract term. That’s sports biz!

So much for Day 1. From here until October, it’s fill-in-the-blanks time with the remnant free agents, a process interesting in its own right.

by Costa Tsiokos, Thu 07/02/2021 11:16am
Category: Hockey, SportsBiz
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Monday, June 29, 2021

“Too many barns and not enough horses” is basically how the major-league arena landscape in the New York City area shapes up:

Five major complexes — four existing and one planned — will soon be slugging it out within an area 30 miles wide.

At least two of the existing arenas already lose money, and experts say further casualties are almost guaranteed.

“Five arenas is not going to work,” said Mark S. Rosentraub, a professor of sports management at the University of Michigan. “I don’t think four works, even in a market as large as New York. There’s competition in every direction and there aren’t enough events.”

The five arenas in question all have their own issues:

In Brooklyn, the developer Bruce C. Ratner is racing to start construction of a $772 million arena for the Nets basketball team, even as Newark woos the Nets for its money-losing Prudential Center arena.

In New Jersey, the owner of the Devils hockey team, which abandoned the Izod Center in the Meadowlands to play at Prudential Center, wants Gov. Jon S. Corzine to tear down the Izod Center, in the hopes of eliminating a competing venue.

On Long Island, Charles Wang is pressuring local officials to approve his plans to rebuild the much-maligned Nassau Coliseum for his Islanders hockey team by hinting that the team might flee to Queens, or leave New York altogether.

Then there is Madison Square Garden, whose owners are starting a $500 million overhaul of the 41-year-old arena. The Garden’s cachet helps draw performers, but the arena has another considerable advantage: three major professional sports teams play there, leaving the Garden with fewer dates to fill than the region’s other arenas, which all play host to only one major sports team apiece.

This doesn’t even count the other large-scale stadia in the same neighborhood: Giants Stadium, Yankees Stadium, and Citi Field. They’re slightly different animals, in that only a very select few musical acts perform mega-stadium shows these days. Still, they provide an x-factor in the competition over non-music venues.

I’m not sure just how dire the situation is. For one, the Brooklyn arena situation is pretty close to collapsing. So I wouldn’t count on those seats even being built. From there, the Nets will have little choice but to move to Newark and rejoin the Devils as co-tenants in the same arena, thus filling out the Prudential Center’s dates. (The final domino to fall in that scenario is the eventual demolition of the Izod Center, which would be without a primary tenant.)

The rule of thumb about an arena needing 200 booked dates to generate an operating surplus is telling. It means that the trend toward major-league sports teams demanding their own, exclusive barn (especially in the Sunbelt) benefits nobody but that team and its owner. The facility itself suffers from lack of use, which prompts demands for subsidies (zero rent, cash infusions, operating concessions, etc.) from the host city/county/state. And, of course, a glut of sports/entertainment seats without enough butts to fill them year-round. It’s a situation that screams for macro-economic oversight.

by Costa Tsiokos, Mon 06/29/2009 12:26pm
Category: New Yorkin', SportsBiz
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Saturday, June 27, 2021

When does the number 32 actually equal 1? When that 32 represents the number of team franchises in the National Football League, and that 1 represents the hoped-for legal exemption the league hopes to achieve regarding select business dealings:

At the heart of the matter is whether the NFL’s teams constitute 32 distinct businesses or a single entity that can act collectively without violating antitrust law.

The case is important to other professional sports besides football. The National Basketball Association and the National Hockey League both filed friend-of-the-court briefs siding with the NFL.

Notably absent is Major League Baseball, which has an antitrust exemption thanks to a 1922 Supreme Court ruling.

“Member clubs of the NFL have no independent value, no purpose, indeed no meaningful reason for existence but for their participation in the league itself,” the NFL argues. It cited a ruling in an antitrust challenge involving the NBA, in which an appeals court wrote, “A league with one team would be like one hand clapping.”

This is completely self-serving, because the NFL and the other major-professional leagues switch themselves off on this argument as it serves their purposes at any particular moment. The economic benefits in assuming single-entity operating status is obvious when it comes to striking merchandising and licensing deals. It’s less obvious, but just as lucrative, when leagues fall back on the autonomous-team model. For instance, when a particular franchise plays hardball with its home city for a new arena, the league office usually cedes authority (not to mention blame) on the matter to that team owner. Yet when the resolution typically results in a sweet new stadium deal, the ripple effect benefits the rest of the league by raising the bar for future facility rights.

Basically, the NFL and the other leagues want it both ways: The protections of single-entity status to fend off pesky lawsuits, but the option of morphing back to a collective of independently-operating clubs when convenient. Business as usual, pretty much.

by Costa Tsiokos, Sat 06/27/2009 04:47pm
Category: Football, SportsBiz
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Friday, June 26, 2021

I never thought I’d lament the absence of rumor-mongering and mostly-clueless talent assessment, but that’s exactly the void I’m feeling heading into the 2009 National Hockey League Entry Draft, which starts tonight.

I mean, it’s been extremely quiet all week. All that’s cropped up is an iffy Phil Kessel-for-Tomas Kaberle trade proposal from the Bruins to the Maple Leafs, and scattered speculation about the chances of the Islanders not picking John Tavares first overall. No other wheeling-and-dealing in bids to move up or down in selection order, or to tinker with rosters before free agency hits next week.

I know why I’m feeling shortchanged: Comparatively, NBA teams completed a flurry of transactions before and during their entry draft yesterday, including the trading of marquee names like Shaquille O’Neal. NHL teams are more constricted by the roster-based hard salary cap they operate under, but still, why should hoops fans have all the fun?

I suspect the hockey world will see a buzz of activity starting right about now, before the Draft begins at 7PM in Montreal. But it’s been a dull lead-up.

by Costa Tsiokos, Fri 06/26/2009 03:47pm
Category: Basketball, Hockey, Media, SportsBiz
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Thursday, June 25, 2021

is there a draft in here
I was hoping my offhand quip about who the New York Islanders should select No. 1 overall in tomorrow’s 2009 NHL Entry Draft would slip past the goalie. But since some other Puck Daddy readers seemed to like it, I’ll reproduce it here, in all it’s crackpot-conspiratorial glory:

The master plan on Long Island: They draft [Matt] Duchene, knowing that the Islander faithful will respond to this anti-[John] Tavares affront by promptly burning down Nassau Coliseum. That will force Town of Hempstead’s hand on the Lighthouse Project arena, and one way or another, the Isles get a new barn!

Probably the most brilliant draft-day maneuvering in the history of the National Hockey League, actually. High time a team fully synthesize its personnel and facility development efforts into one chaos-theory strategy!

by Costa Tsiokos, Thu 06/25/2009 02:32pm
Category: Comedy, Hockey, SportsBiz
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Wednesday, June 24, 2021

bank shot
The New York Mets balked at buying a matching nameplate for their stadium’s nearby subway stop in Queens, but the New Jersey Nets are game for it in their (hopeful) new home in Brooklyn. The NBA team will cough up $4 million for naming rights to the Atlantic Avenue, Pacific Street and Flatbush Avenue subway stations.

No, the stops won’t say “Nets” on them, but rather, “Barclays”:

This may seem odd, since Barclays is a bank based in London with offices in Manhattan, and the only Barclay Street on the city map is not even in Brooklyn. (It’s in Manhattan, in the financial district.)

There will, however, soon be a Barclays Center, the sports arena planned as the focal point of the Atlantic Yards project, and the developer, Forest City Ratner, has agreed to pay the transportation authority $200,000 a year for the next 20 years to rename one of the oldest and busiest stations in the borough.

Of course, a soft economy has rendered the Atlantic Yards project very much up in the air now, so there’s a good chance that this deal will dissolve. But that scarcely matters, because the precedent is now set for other companies to plaster their names onto MTA landmarks, for a price.

Not that any of them are rushing forward:

Still, while selling station names could bring the authority revenue it needs, advertising experts say companies may not be as well-served.

“To be effective, the viewer needs to understand the relevance of the ad,” said Allen Adamson of Landor, a branding firm. “To rename the 59th and Lex stop the McDonald’s stop — it ain’t going to work. I don’t think it will stick.”

Indeed, other cities have tried this with little success. Boston, for example, tried auctioning off four historic stations a few years ago and received no bids…

To determine its asking price for the Brooklyn station, the authority studied a few successful efforts, like a monorail in Las Vegas named for Nextel, the communications company, and streetcars in Tampa, Fla., named for a local electric utility. And the popularity of the station — the second-busiest in Brooklyn last year — was taken into account.

I’m not sure I understand the reticence by corporate America. You’re talking about millions of eyeballs seeing, hearing, and talking about your brand every single day — where else can you get that exposure? Diehards are always going to insist on snubbing a name that’s grafted onto an established station, but that’s not going to completely negate the presence. To me, it’s a golden opportunity to grab urban mindshare.

The only way such subway signage rights would be more attractive would be if they were being offered for virgin territory, i.e. the long-planned 2nd Avenue “T Line”. I’m guessing that when/if construction is ever completed on that new branch, every single station on that route will be corporately-monikered, with no arena or other landmark needed for justification.

by Costa Tsiokos, Wed 06/24/2009 02:02pm
Category: Advert./Mktg., Basketball, New Yorkin', Politics, SportsBiz
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Monday, June 22, 2021

I guess there’s an appropriate improbability in Michael Lewis’ stats-geek bible “Moneyball” getting optioned for adaptation into a big-budget Hollywood movie, helmed by the likes of Brad Pitt and Steven Soderbergh.

And that improbable development shifts into reality-checked probability with news that the $50-million production just had the plug pulled on it, mere days before shooting was to begin. The main reason seems to be doubt from the Sony/Columbia Pictures studio over the profit potential of a baseball movie, particularly in the post-theatrical release phase:

But in keeping with [Oakland A's general manager Billy] Beane’s iconoclasm, look beyond the paper. The key is on-base percentage, and outside Field of Dreams doing $20 million abroad two decades ago — still only 25% of its total gross — what baseball film has ever managed to work overseas? Are we to trust Pitt’s ability to hit for average in foreign territories, or trust the numbers that tell us to bench Moneyball against a notoriously tough curveball pitcher? Considering that the baseball film has struck out more often than Pitt has reached base, is it really that hard a call to make in an economic climate like this?

I assume that the main cratering would occur in the lucrative European market, where baseball doesn’t play. I guess any offset from Japan, Korea, and the Caribbean — the main non-U.S. hotspots for the sport — wouldn’t be enough to make a bases-loaded an international hit. Globalization strikes out!

Actually, that $50-million budget figure has a ring of irony to it, as far as the principles behind “Moneyball” are concerned. Six years ago, when the Oakland A’s were first turning heads with their sabermetrics strategy, Billy Beane himself threw some cold water on the ultimate potential of his penny-pinching teambuilding:

Beane actually said this after [Game 5 of the 2003 American League Division Series, versus Boston]: “I’ll tell you one thing, if you want to give me $50 million more, I’ll promise you we won’t blow the 2-0 lead.”

Since then, the A’s still haven’t gotten particularly close to a World Series, so I guess Beane is still looking for that extra $50 million for his payroll. Hey! Maybe Beane can persuade Sony to fork over that now-unused $50 million to him, and have the money go to some use after all.

by Costa Tsiokos, Mon 06/22/2009 11:05am
Category: Baseball, Celebrity, Movies, SportsBiz
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Tuesday, June 16, 2021

Your National Hockey League is on a real roll right now: On the heels of a court victory affirming its control over franchise ownership and relocation vis-à-vis the Coyotes and Jim Balsillie, it got confirmation that the just-completed Stanley Cup playoffs this year featured some of the highest television ratings in 36 years.

NBC’s Game 7 broadcast of the Stanley Cup final between the Penguins and the Red Wings on Friday night drew an average of 8 million viewers, the biggest American television audience for any N.H.L. game since the 9.4 million who watched the Game 6 Cup finale between Montreal and Chicago in 1973…

The size of the Pens-Wings audience is even more impressive, Variety reports, because Friday is customarily the lightest viewing night of the week.

And of course, some head-to-head context with the NHL’s sister league:

Sunday night’s ABC broadcast of Game 5 of the N.B.A. finals, in which the Los Angeles Lakers won the title against the Orlando Magic, attracted an average of 14 million viewers. That means the N.H.L. telecast drew an audience 57 percent the size of the N.B.A.’s. Traditionally in the U.S., N.H.L. games draw from 25 percent to 33 percent of the audience that watches N.B.A. games.

Yup, hockey fans can take pride in the idea that their sport is half as popular as pro hoops! But good news on the TV front is rare enough that this counts as a resounding victory. The Friday night result gives a nice boost to the final average viewership of 5.6 million for the five NBC-broadcasted games.

So how can the league and the network sustain this strong showing into next year? Some of the ingredients from this year can’t be pre-determined:

- Detroit in the Finals, which always pulls in eyeballs;
- Star-player power in the form of Sidney Crosby;
- The year-over-year rematch;
- Game 7 suspense;
- An unusually unchallenged programming night, with not only reruns on the other channels but also a night off for the NBA Finals;

But one key decision from Stanley Cup 2009 can be preserved going forward: The series-opening ratings juice that came from playing Games 1 and 2 on back-to-back weekend nights. You can debate how successful that would have been for NBC had it been, say, Columbus versus Florida. But I’m convinced that it’s the right way to kick off the showcase series of the playoffs: No opening-night pomp, followed by a day or two off for casual viewers to promptly forget about the whole thing. Saturday night served as the lead-in for a returning audience on Sunday, and the ratings momentum remained sustained from there, right through to Game 7′s breakthrough. So that two-game opener schedule will remain in place next year (and beyond).

I’d like to think that this Detroit-Pittsburgh showing will defuse the constant fretting over “large market” versus “small market” in championship TV ratings. Neither city can be truly considered “large market”, so you’d think that the raw viewer numbers wouldn’t measure up. Then again, they never do, unless you have the ideal population-intense New York-Los Angeles matchup, so it’s a pointless concern. These two cities are recognized as storied hockey towns, which probably helped sell the series; the challenge is to apply that pitch to non-traditional teams that might reach the Finals next year.

Finally, it’s refreshing to not hear about how hockey in June allegedly doesn’t work for a national audience. Summertime pucks seems to have found fans this time around.

by Costa Tsiokos, Tue 06/16/2009 11:41am
Category: Basketball, Hockey, SportsBiz, TV
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Monday, June 15, 2021

no hamilton league
So much for the Hamilton Coyotes. Bankruptcy court rejected Jim Balsillie’s attempt to buy the Phoenix NHL franchise and relocate it to southern Ontario:

[Judge Redfield T.] Baum shot down the claim by Coyotes owner Jerry Moyes and Balsillie that failure to allow the team, over the objection of the NHL, to move would violate antitrust law.

“This court can not find that antitrust law, as applicable nonbankruptcy law, permits the sale free and clear of the relocation rights of the NHL,” Baum wrote.

He added, “It is not an antitrust violation for professional sports leagues to have terms and conditions on relocations of its members.”

An antitrust claim requires a “bona fide dispute,” but there is none because Balsillie only sought the NHL’s permission to relocate the franchise after it was brought up in court, Baum wrote.

“This court is unconvinced that it should order that the NHL must decide the relocation application to meet the June 29 deadline,” the judge wrote.

Baum also rejected claims by Moyes and Balsillie that while assuming the contract the Coyotes have with the NHL, they can disregard the portion of the agreement that requires the games be played in Glendale.

The judge compared that claim to “a purchaser of a bankrupt franchise in a remote location asserting that it can be relocated far from its original agreed site to a highly valuable location, for example New York City’s Times Square …”

Basically, this gambit is dead, despite Balsillie’s posturing for further mediation. Frankly, I’d have been shocked had it gone the other way. The bankruptcy maneuver was an obvious attempt to circumvent league process and approval — and not just for hockey, but for the other three major-league sports as well (indeed, other team sports were primed to take advantage of what would have been a new precedent). No way was the court going to upend standard operating procedure for North American professional franchise sports, just so a BlackBerry billionaire can have a team in his backyard.

I think I pointed this out before, but it bears repeating: I don’t know why anyone would want to engage Balsillie in a National Hockey League team sale again. He’s had three chances to buy a franchise, and has not only flubbed them all, but did so in particularly hamhanded fashion. What does his inability to get into the NHL owners’ club say about his general acumen as a businessman — you’d have to think he’d be a disaster if he ever did become a team owner. Why bother dealing with him if it’s practically dead certain that he’ll never get through the approval process, thanks to his by-now transparent intent to relocate any team he’d buy to Ontario? It’s automatically time wasted.

As for the ‘Yotes, their arena situation not only locks them into the Phoenix-Glendale market, but also holds the longer-term key for their viability. Arena operations is a default condition for major-pro team sports success, and the Coyotes have that. Any new owner should be able to exploit that, and build a successful hockey show in the desert from there.

by Costa Tsiokos, Mon 06/15/2009 11:01pm
Category: Hockey, SportsBiz
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Tuesday, June 09, 2021

stripped gehr
A tanking economy called for a cutback on extravagance in Brooklyn’s proposed Atlantic Yards, and that meant saying goodbye to “starchitect” Frank Gehry and his arresting $1-billion NBA arena design.

So developer and New Jersey Nets owner Bruce Ratner went to Plan B: A basketball barn downsized in pricetag and aesthetics, and already being savaged accordingly:

Whatever you may have felt about Mr. Gehry’s design — too big, too flamboyant — there is little doubt that it was thoughtful architecture. His arena complex, in which the stadium was embedded in a matrix of towers resembling falling shards of glass, was a striking addition to the Brooklyn skyline; it was also a fervent effort to engage the life of the city below.

A new design by the firm Ellerbe Becket has no such ambitions. A colossal, spiritless box, it would fit more comfortably in a cornfield than at one of the busiest intersections of a vibrant metropolis. Its low-budget, no-frills design embodies the crass, bottom-line mentality that puts personal profit above the public good. If it is ever built, it will create a black hole in the heart of a vital neighborhood.

But what’s most offensive about the design is the message it sends to New Yorkers. Architecture, we are being told, is something decorative and expendable, a luxury we can afford only in good times, or if we happen to be very rich. What’s most important is to build, no matter how thoughtless or dehumanizing the results. It is the kind of logic that kills cities — and that has been poisoning this one for decades.

Yes, a good deal of snobbery permeates this critique: Ellerbe Becket‘s Kansas City pedigree alone amounts to an affront when considering large-scale development in the five boroughs. Metropolitan propriety bristles at any hint of importing structures that resemble flyover-country landmarks.

Still, it’s not like Ratner didn’t ask for it with this stripped-down shell. There really is nothing distinctive about this proposed facility — it’s just a generic roof to provide a covering for the 20,000 seats beneath it. It’s utilitarian, but obnoxiously so. And it’s certainly not born from a vacuum — a comparison with Gehry’s might-have-been makes the Ellerbe Becket design look that much cheaper (even if “cheaper” still adds up to around $800 million).

At this point, it’s obvious Ratner is merely salvaging the attempt to develop his patch of Brooklyn, with any mega-square-footage enclosure feasible for housing the relocated Nets. Last-ditch effort that’ll probably get ditched altogether.

by Costa Tsiokos, Tue 06/09/2021 10:38pm
Category: Basketball, New Yorkin', SportsBiz
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