Saturday, May 31, 2008

The NHL: Where Gary Bettman Happens

(Photo from The Red Line)

Gary Bettman's most recent interview with Ron MacLean, which just aired on CBC's pre-game show, clearly is deserving of its own place in history on the Unintentional Comedy Scale. I recommend at least a 78: better than the Super Bowl Shuffle but not quite up there with Bill Clinton's denial. Credit to MacLean for going after Bettman with both barrels blazing, instead of throwing the softballs usually delivered at the commissioner's public appearances (often by broadcasters from his league's own network) or by callers to his radio show.

A key topic of conversation was sports business columnist extraordinaire Rick Westhead's piece in the Toronto Star yesterday, which revealed that the six Canadian teams (20 per cent of the league, if you're keeping track) account for a staggeringly disproportionate 31 per cent of the league's gate receipts. This provoked incredible hilarity, as Bettman tried to bash the piece as sensationalist journalism without actually denying any of the numbers or statistics cited. One of the greatest moments in the interview came right at the start, when Bettman attempted to reverse the spin of the numbers (an effort that must have made Nick Naylor proud), saying, "It is a little disproportionate, and I think that that may be a very good thing." He went on to talk about how the Canadian teams were struggling back in the late-1990s, and how it's supposedly healthy to have it the other way now.

Um, hello? Is Bettman's brain on? First, most of those struggles were due to a Canadian dollar that was in the dumps during the 90s and hit an all-time low of U.S. $0.61 as late as 2002. When your main expense (salaries) is in U.S. dollars and your main income streams (gate attendance and TV) arrive in a currency that's almost 40 cents below even, but the prices don't tend to be that different for TV deals and seats, that's a severe problem. The dollar's rise to parity has had far more to do with the recent success of Canadian clubs than any league initiatives. Second, any economist worth his salt could tell you that it isn't healthy to have 20 per cent of your clubs (and the 20 per cent that experiences only minimal marketing, as most of the league's efforts are focused on growing the game south of the border) bringing in 31 per cent of one of the significant revenue streams (and it's not unreasonable to think that the TV and corporate sponsorship numbers are similar).

It got even better from there. "Frankly, revenues are growing all across the league," Bettman said. "Any suggestion to the contrary is someone trying for a headline." Uh, sure they're growing, but not all across the league. The ever-excellent James Mirtle did some calculations and figured out that 60.3 per cent of the $119 million in ticket revenue growth came from the six Canadian teams. Sixty per cent of the growth! That's even worse than the 31 per cent overall. When you factor in that a huge amount of that supposed "growth" is really just additional revenues from the rise of the Canadian dollars, it paints a portrait of a league that is in pretty dire straits financially. As the Globe's Stephen Brunt wrote yesterday, "In a league that in the absence of significant national television money in the United States relies heavily on live gate, 31 per cent of ticket revenue is generated by Toronto, Montreal, Vancouver, Calgary, Ottawa and Edmonton. Even those at the small-market end of the Canadian spectrum are bringing in more than twice the gate receipts of at least eight U.S.-based franchises. Take away the exchange rate bump, and a passion for the game in this country that only increased after the great labour war, and you have a sports business that is close to stagnant."

Bettman continued on in this fine vein of form, growing more flustered and blustery with each passing moment. His quotes also began to make even less sense. "The Canadian clubs are somewhat in the mid-twenty per cent range." What does that even mean? It sounded like he was trying to suggest that Canadian franchises are middle-of-the pack economically, but that's in sharp contrast to Westhead's numbers, which are actually the NHL's own numbers (he got them from a secret league document). When MacLean suggested that the game's in trouble south of the border, Bettman responded with "Trouble's a funny thing," which tells you absolutely nothing. He then continued with the always-reassuring "Everything's going to be fine," said in "We've just hit an iceberg" tones, and the ever-popular "We're in the best shape we've ever been in," which not only elevates him to the Liars' Hall of Fame with such luminaries as Clay Bennett, but also makes me even more disillusioned with this league: if this is the best it's ever been, maybe we should just let it die, as there's little worth saving at the moment.

The interview continued to get even better. Bettman went after MacLean for only talking about gate receipts, saying that they'd seen huge attendance jumps in the U.S. MacLean quite rightly saw through this smokescreen and asked Bettman if that wasn't only due to the sharp discount on tickets in most American markets to try and get to the magical 14,000 number needed to receive revenue-sharing. Bettman knew his bluff had been called, and awkwardly responded with "That's one part of the equation. You have to have a certain portion of paid attendance." He then went on a wild stream-of-consciousness rant about "people" having "agendas" that made Buzz Bissinger look positively lucid.

Bettman then continued in fine form when MacLean asked him about the ongoing federal investigation of Nashville part owner William "Boots" Del Biaggio III, who's pretty much only in the group to move the team to Kansas City. Del Biaggio is now being sued for "complete fraud" in relation to his business dealings, as opposed to his supposed intentions of keeping the team in Nashville. Bettman first asked MacLean about the terms of the investigation (which you'd expect he'd know, as it affects one of his owners, but I'll give him a bit of a break here as this is pretty late-breaking). Afterwards, he said, "Nobody in Nashville should worry. The Predators will be absolutely fine." He also seemingly refuted the possibility of the team moving. Hey, at least he's on the same page as the team management, which said that the investigation "will have no impact whatsoever." As Greg Wyshynski points out, Bettman might actually be right on the team staying in Nashville for a while longer: if Del Biaggio's out of the picture, there's less of a push to jump to Kansas City. As another interesting thing, Del Biaggio is one of at least three NHL owners currently under some form of investigation: the Anaheim Ducks' Henry Samueli is being sued by the SEC and accused of fraud, and their 2007 Stanley Cup final opponent's owner, Eugene Melnyk of the Ottawa Senators, is fighting both the SEC (which his company paid $10 million in a settlement) and the Ontario Securities Commission. Sounds like we might be back to the days of Bruce McNall and John Spano.

(Aside: Kansas City? Seriously, what's with the rush to move into the Midwest? Does the NHL want to start a "Dust Bowl Division" before the NBA can? The only good thing that could possibly come out of an NHL franchise in Kansas City would be Joe Posnanski writing about the league.)

Bettman continued with a fine comment on the state of the league, "There's been a lot of suggestions, a lot of allegations that we're doing something wrong." Hmmm... maybe those suggestions are arising because you're actually doing A LOT OF THINGS wrong. As Brunt wrote, "There are a couple of ways one might describe the Gary Bettman era in the NHL. Unequivocal failure would be one."

Coming soon: ways to fix what Gary hath wrought upon the league.

1 comment:

  1. Hats off to Maclean in a big way on that one, it was an awesome sight to see him giving it to Bettman in his non-threatening style.

    I guess years of sitting next to Grapes has fine-tuned his Bullshit-o-meter to an incredibly precise degree!