BOG meetings: Owners get sobering message on economy; more eyes on Europe?
"In the short term, it's pretty dark," NHL deputy commissioner Bill Daly said. "It's a credit crunch, not a lot of financing available, a lot of bad paper out there. So it's going to be tough sledding."
Owners and executives from the league's 30 teams heard from two financial experts, and the message wasn't pretty.
"They went into it deeper," Edmonton Oilers CEO Patrick LaForge said of the experts' presentation. "Job losses, the depth and the length, in their view, of the recession. It was sobering. I hadn't heard it in that kind of detail, and if you're in Edmonton, Alberta, Canada, you're just not running into a lot of U.S. economists. You get a bit of a Western Canadian view.
"When you look at all of North America, it becomes a little a more dark and deep."
Let's face it -- hockey isn't a heavyweight in the United States. So when you see Tiger Woods lose a major sponsor and teams dropping out of NASCAR because of the world financial crisis, you know the NHL will also have its share of issues going forward.
The key is to avoid a panic, Daly said.
"Fear feeds on fear," he said. "You really don't want to have a sense of panic where people can't operate in the normal course.
"Having said that, they have to understand what the realities are too and they have to operate their businesses accordingly."
No team is recession-proof, said Toronto Maple Leafs president and GM Brian Burke.
"Our fan base and our corporate base are facing the same challenges as everyone else," Burke said. "You see what's happening in NASCAR. You can't argue that it's not having an effect on professional sports."
Earlier this season, the NBA announced job cuts that shrunk its staff by 9 percent; but as of right now, the NHL hasn't followed suit.
"Clearly, we have a hiring freeze, we're not filling head count," Daly said. "But at this point, we're not eliminating positions. We're just looking to cut expenses all over the organization."
Holding this two-day meeting at such a posh resort hotel doesn't exactly cast a great image given the economic climate. But we're ready to give the NHL a mulligan since we're told it investigated its options in terms of moving the meeting but were locked in financially on using The Breakers months ago and wouldn't get its money back if it canceled. You can bet next December's board of governors meeting won't be in sunny Florida if the bad economic times continue.
In the meantime, teams are trying to get through this. The Columbus Blue Jackets on Monday were the latest team to respond to the economic times, announcing a creative ticket buying plan that, for a limited time, allows fans to buy tickets and pay them off over a 14-week period in $10 installments. Smart.
"We're trying to give people an option to come to games that's affordable and makes sense," Jackets GM Scott Howson said after Monday's meeting.
And as we discussed in our weekend blog, the NHL's salary cap actually won't budge too much despite the economic woes. That's because around 70 percent of revenues were already accounted for in September before the crash. But if corporate sponsors and season-ticket buyers take a pass next summer, lower revenues will greatly affect the salary cap for the 2010-11 season.
"It's [about] next season," Blues president John Davidson said. "We we've got to pay attention to what's going on to protect ourselves for the future."
"Business is going to be difficult in Boston next year, I know," said Boston Bruins owner Jeremy Jacobs, the chairman of the board of governors. "And it's difficult now. So we have to really take care of our fans and make sure we play good hockey and keep winning."
The NHL and Europe
It wasn't all about the economy Monday. The new Champions Hockey League in Europe, which is in its first season of operation, was discussed. The league is similar to the soccer version, where club teams from all over Europe and Russia compete in a season-long tournament.
We find it intriguing to say the least that the NHL discussed the merits of possibly investing into a part-ownership of the league.
"It's interesting. It's a good concept that's over there," said Colin Campbell, the NHL's executive vice president and director of hockey operations. "The owners found it interesting."
At this point, it's only an idea, but if the NHL does indeed buy into the Champions Hockey League, it only further strengthens the notion that it continues to eye possible European expansion one day. As it is, six NHL teams are expected to open the regular season with games in Europe next fall.