The NHL enters the 2009-10 season with renewed and growing interest in the sport, but the good news has been clouded by instability among team owners, financial troubles of several teams and uncertainty over the future of hockey in some markets.
Commissioner Gary Bettman has acknowledged a “distracting and interesting” summer that saw him shuttling back and forth from an Arizona courtroom for bankruptcy proceedings involving the Phoenix Coyotes. He has constantly fielded questions about the possible relocation of as many as a half-dozen teams to places like Kansas City, Hamilton, Ontario, and Las Vegas. And he has been forced to defend the mere existence of a handful of franchises facing lingering financial woes.
“Hockey gets so little space in the newspaper anyway, and if the only space it’s getting is devoted to a negative business article, that’s not good,” said Howard Bloom, an Ottawa-based sports marketing consultant and publisher of Sports Business News. “The NHL needs to get the Phoenix Coyotes off the sports and business pages.”
The Coyotes saga has embroiled the NHL in a bitter battle involving a bankruptcy court and Canadian tech mogul Jim Balsillie. With the team facing financial troubles, Coyotes owners filed for bankruptcy and struck a private deal to sell the team to Balsillie, who had plans to move the team to Hamilton. The NHL has fought the transaction, arguing that any sale of the team required the approval of fellow owners, and attempted to broker a deal involving Jerry Reinsdorf, the owner of the Chicago Bulls and White Sox, to keep the team in Glendale, Ariz.
“We’re fighting to protect our rules,” Bettman said Saturday during an appearance at the Capitals’ fan convention. “It has nothing to do with Southern Ontario or another team in Canada. This has to with being a league that sticks by its fans, sticks by its markets and enforces its rules. Because without that, you can’t have a sports league.”
With the issue unresolved and the season about to begin, the ownership tumult led to the resignation of NHL legend Wayne Gretzky as coach. And the team is expected to see paltry attendance, as its season-ticket base dropped below 3,000. The team slashed ticket prices to below $25 apiece for its home opener in an attempt to sell out the game.
“The Coyotes thing,” Bloom said, “is a disaster.”
Phoenix is not the only team that has faced recent uncertainty over ownership. Owners of the Atlanta Thrashers battled in court for more than four years over a dispute involving a buyout of minority owner Steve Belkin. A judge ruled in August that Belkin would remain part owner.
Owners of the Tampa Bay Lightning are involved in a similar buyout feud, with the NHL laying out a set of deadlines for the disagreement to be resolved. Part owner Len Barrie was given a 60-day window to buy out fellow owner Oren Koules, but that deadline passed last week. Koules now has until Nov. 23 to reach a deal to buy out Barrie.
In Nashville, a syndicate of local buyers bought out majority owner William “Boots” Del Biaggio, who later filed for personal bankruptcy after he was unable to pay back a series of loans. Del Biaggio was recently sentenced to eight years in prison for forging financial documents to illegally obtain the loans, which he used to help buy the Predators.
Meanwhile, Florida Panthers owner Alan Cohen has been attempting to sell the team to a investment firm, but the bid has been rejected by the NHL on the grounds that Sports Properties Acquisitions Corp. would not have a single member with a large equity stake. Sports Properties’ president and CEO is Washington Nationals president Tony Tavares, and the firm’s directors include Hall of Fame baseball player Hank Aaron and former New York Gov. Mario Cuomo.
In nearly all of these cases of ownership uncertainty, teams have been put up for sale because they have incurred millions of dollars in losses. Those financial troubles have led to suggestions that the NHL was unwise to place teams in nontraditional hockey markets, particularly in the Southeast and Southwest. Relocating those teams to stronger hockey cities like Hamilton, Winnipeg or even Seattle or Portland would help the league’s bottom line, analysts said.
“There are about a half a dozen teams that need to move to stronger markets, and once that’s done the league can flourish,” Bloom said.
Kansas City has repeatedly surfaced as a potential site for relocation, and as home to the modern Sprint Center it is one of the few non-NHL cities with a recently built arena that can accommodate hockey. But flirtations with the Predators and Pittsburgh Penguins, among other teams, have thus far proved fruitless for the city. The latest possible candidates are the New York Islanders, who played a preseason game against the Los Angeles Kings at Sprint Center last week. Islanders owner Charles Wang has claimed millions of dollars in losses and has worked unsuccessfully to get a new arena for the team on Long Island.
Bettman, however, said the league has no plans to relocate teams and has used the Capitals as an example of a franchise that has done well in a city once viewed as a poor hockey market.