Ziegler's NHL dream got burned in Sunbelt
- From today's Toronto Star:
LOOKING BACK AT EXPANSION
Oct 03, 2009 04:30 AM
With startling prescience, former NHL commissioner John Ziegler dreamed of a 30-team league two decades ago.
As visionary as the plan might seem now, it's hard to imagine today's 30-team league fulfils its architects' imaginings.
With the Phoenix Coyotes in bankruptcy proceedings and rumours of deep financial problems with three or four other southern expansion clubs, there are plenty of questions about the NHL's choice to take professional hockey to America's Sunbelt.
"Beginning in 1988, we drew up a strategic plan for the NHL," says the former hockey boss who still serves as an alternate governor with the Chicago Blackhawks. "We projected the NHL would expand to 30 teams by the end of the 1990s."
Dubbed "Vision for the 90s," the unanimously accepted plan predicted with precision what would unfold over the next decade.
The expansion blueprint did not identify specific locations for the new teams, said Ziegler, who was commissioner between 1977 and 1992.
"It was absolutely vanilla as to where the teams would come from. What we were looking for was a strong urban centre, a place that had an identification with professional sports and the other was a financially sound owner."
After Ziegler's departure, NHL expansion aggressively charted new territory in the southern U.S. - a decision that has proven an unmitigated economic failure, say business experts.
Whatever the outcome of the legal battle over the Phoenix Coyotes, the club has no financial future in the desert, they say. And there are likely four other southern U.S. teams in the same economic straits.
"It has been shown very clearly that the NHL is not a viable business in Phoenix and I think you have to question the whole Sunbelt strategy of commissioner (Gary) Bettman," said Richard C. Powers, associate dean and executive director of the MBA and Master of Finance programs at the Joseph L. Rotman School of Management.
"It was a bad decision before, it is a bad decision today."
While the legal fate of the team remains on ice after a bankruptcy court ruling Wednesday shifted the spotlight solely on to the NHL to sweeten its bid for the troubled club, Coyote ticket prices have been slashed to boost attendance.
According to the Arizona Republic, the Coyotes were close to a sellout for the regular-season home opener Oct. 10 thanks to cheap tickets and a "Welcome Back WhiteOut" campaign that includes a white T-shirt and pom-poms.
While that may work as a short-term emergency strategy, it simply erodes long-term revenues even further, said Powers.
"What was a difficult sell previously has become an impossible task today with the uncertainty of relocation hanging over the team. This team is finished in Phoenix - it is just a matter of time."
Roger Noll, a professor of sports economics at Stanford University, said the league is about five teams too heavy for the economic realities of professional hockey.
"(Bettman) should have stopped five teams ago," he said. "It isn't going to work."
Contraction is the path that business experts say the league must now choose. But there's no sign NHL officials agree.
"They're being ostrich-like," said Noll. "They're letting the system spin out of control because of their own inability to face reality and make difficult decisions."
Contraction if necessary but not necessarily contraction, others say.
A northern migration could prove successful in keeping the number of teams at 30, said Larry DeGaris, director of the academic sports marketing program at the University of Indianapolis.
"A couple (of teams) will likely move to Canada," he said. "That might not be a bad compromise. Move a couple of teams having the most problems to Canada and help out the remaining teams."
While Hamilton may have taken centre stage in the current push for a seventh Canadian NHL club, Ziegler said the city has always been "an area of conflict."
"It's squarely within the Toronto market. That's a complication. And complications always make it difficult. It's not that they can't be overcome, but it's not like Winnipeg. You have another layer of consideration that you have to go through."
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