Meet the New Boss. Looks a lot like the Old Boss. But Not Qute.
The NHL is undergoing a sea change.
The Ontario Teachers Pension Plan has sucked about as much profit from MLSE as it could. The OTPP business plan was about building an equity footprint via real estate development during a real estate bubble. The Leafs, Raptors and Air Canada Centre generated the cash that services the rather cheap debt. The bubble is done, the profit has been made. The OTPP business plan was never about content (read: hockey and basketball) as long as content was generating enough cash to service debt. The content itself was always a footnote. In other words, the Leafs and Raptors didn’t matter as long as the seats were full.
Rogers needs content to feed the wide maw of a much larger television and Internet media empire. With Rogers equity footprint becomes a base for supporting greater media operations.
What does this mean? If it’s about content, winning suddenly matters. Hockey and basketball will suddenly need to be entertaining, to expand beyond the season ticket holders and the poor souls who buy Leafs TV. Rogers will make gobs of money if they can attract the people who currently don’t give a damn.
The way to do that is through quality product.
Leafs fans, congratulations. This is good for you in the long run. It’s also good for Ottawa Senators fans as it will force Eugene Melnyk to rethink some assumptions. It also opens the door for another team in Southern Ontario, as TSN, which is owned by Bell, is about to lose content to Bell’s biggest competitor Rogers, which also controls content for the Ottawa Senators. The biggest difference between Teachers and Rogers is that content begets more content, as the important factor becomes increased eyeballs, not bums in seats.
The result of a team in Hamilton is more subscribers watching TV. The best regional ratings for TV sports are always for regional rivalries: Hamilton Aeros vs. Toronto Maple Leafs at Copps Coliseum might mean a loss of 20,000 ticket sales, at a hundred bucks a pop, once, but it adds a gain of 2,000,000 subscribers paying 7 bucks a month over a course of many years. Rogers will need a team in Hamilton in the same way MSG needs teams in Long Island and New Jersey, even if they don’t control the media rights, as long as they control the media rights for games against the Leafs. They’ll of course want to extract their blood payment as well, but that’s obvious. The answer is no longer no, but at what price.
The CBC, as usual, is wondering what the hell happened, as its favorite team is now controlled by a competitor. They still haven’t realized that Punch Imlach is dead.