Raleigh — In the bright light of day following its wild Stanley Cup party, the National Hockey League awoke to all of the usual headaches.
On the ice, as the marvelous Stanley Cup tournament showed, the league has its house in order. There are some things to be ironed out, such as the delay-of-game penalty for shooting the puck over the glass and the bosses' tendency to micromanage the on-ice officials in big games, but these are minor matters.
Off the ice is a different matter.
Almost all of the problem markets remain problems. The problems come in two categories, which are usually linked — lack of interest and bad ownership.
However, there is one bright spot — the Pittsburgh Penguins — although the franchise is not yet in the clear. Its future in Pittsburgh depends on securing a slots licence, which will finance a new arena.
But there are enough parties interested in buying the franchise from Mario Lemieux and his partners that its prospects for staying in Pittsburgh have improved in recent months. There are the usual suitors who want to move the team, but one of the serious ones has no such plan.
Andy Murstein is a banker from New York whose family got rich by lending money to small and distressed businesses. He and his partners think Pittsburgh is a good hockey market — quelle surprise — and say they plan to keep the team there if they win the bidding.
This may ease the pressure for the casino company Isle of Capri to win the slots licence. It is the only bidder for the licence to promise to completely fund a new arena from the profits, although it looks like the other bidders may have to kick in something to get the licence.
The interest in the team is such that one banker thinks the team could sell for as much as $150-million (all figures U.S.). That is 150 million real dollars, as opposed to the usual NHL sale which is announced as $150-million but is really much less, as the buyer is actually covering some of the seller's debt or the seller is taking back a mortgage. Not bad for a team without an arena.
But that's about it for the good news.
The outlook is far less rosy in the problem markets — Atlanta, Nashville, Florida, Phoenix, Washington, Boston and Chicago.
The Atlanta Thrashers owners are involved in a nasty court fight with Steve Belkin, a former partner. The result may be that Bruce Levenson and the other owners will sell the team to Belkin, who is not considered the best ownership material in sports. Combine that with the team's inability to sell tickets and its future is uncertain.
In Nashville, the city appears to have finally decided to play hardball with owner Craig Leipold in order to get more favourable terms in its arena lease. This fight recently broke into the open when the city finally informed Leipold it believes he is in violation of a lease agreement because the value of the franchise is incorrectly stated in a loan contract.
The Predators recently fired back with demands for more money from the city and made hints about moving the team.
The point here is that the Predators have the sweetest lease deal in hockey — the city pays all the bills and the team gets all the revenue — and still cannot make the NHL a going concern in the capital of country music.
Now that Jerry Moyes forced Steve Ellman out of the Phoenix Coyotes' ownership picture, the team is a little more stable. But it still has severe attendance problems, as do the Florida Panthers and Washington Capitals.
For a league that has no significant U.S. television network revenue and depends on ticket sales for the bulk of its income, this is not a good thing.
Just as troubling are a couple of traditional markets. Owners Jeremy Jacobs and Bill Wirtz have alienated hockey fans in Boston and Chicago, respectively, two of the NHL's Original Six teams.
The salary cap did an excellent job in bringing small-market teams like the Carolina Hurricanes and Edmonton Oilers to the Stanley Cup dance. But the flip side is that if large-market teams are not well-managed they will never get close to the late rounds of the playoffs.
This league desperately needs its large-market teams to be successful to increase its visibility on the U.S. sporting scene. If the Los Angeles Kings and the New York Rangers are in the Cup final, or Chicago or Detroit or Toronto, then television gets interested and everyone in the league benefits.
But right now, management in too many big markets simply isn't good enough.
