Where the NHL's money comes from
An estimated total of $2.56-billion (U.S.) in revenue this season
Regular-season tickets: $1.02-billion (40%)
Arena naming rights, concessions, parking, sponsorships: $768-million (30%)
Local TV and radio: $307-million (12%)
Playoffs: $282-million (11%)
National TV revenue: $179-million (7%)— Toronto Star
Rick Westhead had a pretty nifty cover story in Sunday's Toronto Star, and the above numbers ran along with it in the inside pages. Their source is listed as "Toronto Star research, bankers and NHL team officials."
Westhead reports that one of the ways some players feel the league could increase revenues would be to sell jersey advertising, beginning with goaltenders. According to "prominent hockey marketer Brad Robins and Edmonton player agent Ritch Winter," "on-uniform ads might generate upwards of $30-million a season for the NHL."
It's an interesting twist that we're now seeing players pushing ways to increase revenues, even relatively unorthodox ones (by North American standards) like jersey ads. $30-million seems like small potatoes in a $2.56-billion pie, but one imagines this would only be the first of many similar suggestions the NHLPA will generate.
In King of Russia, Dave King and Eric Duhatschek talk about the structure of the Russian Super League's business model, and how — unlike the NHL — gate receipts actually make up a very small portion of league revenues. Jersey advertising is minimal there at the moment, but referees are skating billboards and some teams are named after the corporations that sponsor them.
Sponsorship dollars actually offset a lot of the costs in European hockey, making games more affordable for average fans. (One of the reasons many feel a rumoured new European "Super" league would fail to compete with the NHL is that hockey fans overseas simply aren't used to paying top dollar to go to games.)
Now, it's rather optimistic (or out of touch) to suggest higher sponsorship revenues could ever affect NHL ticket prices, but what it could do is change the revenue structure in the league. There's such incredible pressure on teams to jack up ticket prices given receipts make up more than 50 per cent of revenues, and much of the real revenue "growth" that we've seen postlockout has come from increased ticket prices.
"This is the wave of the future," says Winter. "The NHL isn't as profitable as other leagues, and we have very little choice but to pursue new ways to create revenue so we can reinvest in our sport. It's just a way to pay the bills."More creative thinking could equal more hockey related revenue, which as far as the league, its players and agents are concerned, is a good thing.
Is this an area of mutual agreement where the partnership can work?