Tuesday, October 07, 2008

Challenges mount in Atlanta

This last summer I thought Don Waddell should have been moved up to Team President and a new GM brought in. The Thrashers management has made a string of poor bets and this summer they were turned down by all of their Plan A free agent targets. Now it seems that the fans too have given them a thumbs down. And really, who can blame the fans? When there is no change at the top and no big free agent additions why pony up the cold hard cash for another year of getting losing?
Nashville has been getting all of the attention these days, but things are dire in Atlanta. The team's ownership situation is a mess, locked up in a nasty court battle, and on the ice, it's expected to be another lost season.

I give them credit for forking out to bring in Mathieu Schneider, but for many of the remaining fans, that's not enough, and another rebuilding season will not fill the building. Not even close.

Meanwhile, Ilya Kovalchuk's unrestricted free agency date creeps closer.

Tripp Mickle of The SportsBusiness Journal reported yesterday that the Thrashers were dead last in season ticket renewals at just 40 per cent as of mid-August — this for a team that has finished in the bottom 10 in league attendance every year since the franchise's inaugural season in 1999-00.

(Actually, what's really amazing, if you think about it, is that Atlanta managed to sell more tickets than eight other franchises last season. I can't see that being the case this time around.)

Blogger Dirk Hoag asks "is this a case of a non-traditional market not supporting hockey, or a fan base turning away from a team that has consistently failed to deliver a competitive product and offended season ticket-holders" and I think the answer is a little of both.

It's an ugly combination.
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30 Comments:

At 7:31 AM, October 07, 2008, Anonymous Anonymous said...

What a surprise! A market that didn't support a decently successful team in the days of the Flames now doesn't support its undeserved second NHL franchise.

Looking around at the smoking ruins of the Predators and the Thrashers makes me wonder how long it'll be before the Coyotes and Panthers join them on the endangered list.

Bravo, Bettman....hockey for uncomprehending and disinterested Southern Americans has really energized the sport. Nothing makes a league look better than having 15% of its teams on a franchise death watch.

And can someone tell me why exactly Winnipeg was bad for this league?

 
At 10:10 AM, October 07, 2008, Anonymous er said...

the thrashers obviously stink but atlanta is also widely acknowledged to be america's worst professional sports city in terms of fan interest/support(followed closely by LA).

thus, this is not surprising.

 
At 10:15 AM, October 07, 2008, Anonymous Anonymous said...

No one said Winnipeg was bad for the League. That situation has become completely misrepresented over the years. The NHL didn't force the Jets to move. Rather, the Jets' owners wanted to move, and the League wouldn't make them stay. The Jets were losing money hand over fist at the time -- this was the era when the Canadian dollar was low, free agency was taking off, and the Jets simply couldn't compete on the revenue side. The taxpayers of Manitoba, in fact, were heavily subsidizing those losses in the last couple of years. That situation simply couldn't last.

Some of those revenue concerns have been addressed with the new building, but you still have to wonder if there is enough corporate money in Winnipeg to buy the boxes, rinkboard ads, etc. Ditto for Quebec City -- even if they got a new building in Quebec City tomorrow, there would still be concerns on the corporate side.

As a Canadian fan, I would love to see the Jets and Nordiques back tomorrow - I am simply saying that there were hard economic reasons for their moves back in the day, and that it wasn't part of some evil plot.

 
At 10:17 AM, October 07, 2008, Blogger Andrew said...

So I love how people are pissing all over the thrashers for no reason. Their owners screwed them over (getting into their own little ownership tussle) so no wants to play here right now. Anonymous, obviously you think its smart to put a professional spot in a city that has barely half a million people compared to a city that has 5 million and is still growing.. let me tell you how logical that is. I'm guessing you didn't study business in school. The thrashers haven't gotten their feet wet in terms of sports teams in atlanta... every other team that is here has been here for 20 years and has had streaks of success. Give the frachise time to get accepted in Atlanta. It will come and they will get better.

 
At 10:18 AM, October 07, 2008, Blogger FAUX RUMORS said...

1) You can blame the fans, but what city would support what Don Wadell has done the past few years?
2) That said, traditionally Atlanta isn't a good sports town. So the 'race' will be which moves soonest, Nashville or Atlanta?

 
At 10:26 AM, October 07, 2008, Blogger wade little said...

No one has ever said Winnipeg was bad for the league... if anything, the league was bad for Winnipeg.

Unfortunately, Winnipeg was partly to blame for the inflated contracts - so was St. Louis for signing Scott Stevens or Wayne Gretzky for asking for more money, New York for offering Sakic a contract, the Hurricanes for offering Fedorov stupid money, Milburry for signing Yashin to his retarded contract, Edmonton for Vanek's offer sheet, or even Lindros for holding out on Philly.

Those are the factors that made the NHL bad for Winnipeg.

 
At 11:17 AM, October 07, 2008, Blogger Scott said...

It would be an exaggeration to say that they weren't supporting their team in Winnipeg before they moved, but at the same time they weren't selling out games. Their last year in the leagure, attendance was 11,316 per game. Beleaguered Nashville was at 14,910 last year while Atlanta managed only 15,824 per game. Winnipeg was struggling. Winnipeg had the lowest attendance number in the league in their last year and was in the bottom five for their last three years. Sunny teams that drew more fans than Winnipeg in each of the last three years of Winnipeg's time in the league: Tampa Bay, San Jose, Los Angeles, Florida, Dallas, Anaheim. On a relative basis, the market just plain sucked for supporting an NHL hockey team.

 
At 11:18 AM, October 07, 2008, Blogger The Falconer said...

The truth is nobody knows what the Atlanta market would do with a solid product.

Other than Toronto, in most NHL markets fans are not going to line up to buy tickets when a team finished in the bottom third of the NHL year after year.

They had one season when they finished 15th in a 30 team league and were swept out of the playoffs with a couple of soul crushing losses.

I will say that Atlanta roots for winners. This is a city of 5 million people, many of whom moved here from somewhere else. You have to do something positive to get their attention.

 
At 11:28 AM, October 07, 2008, Blogger Taste of Flames said...

I'm a resident of Athens, GA and hardcore Thrashers fan. The problem with the teams attendant is NOT because the city doesn't care or because hockey doesn't belong in the sunbelt. Cut the ego for a second and look at a few facts here. Its not that ATL is a "notoriously bad sports town", ATL fans are painfully fair-weather. Atlanta (and the surrounding area) is a city with 4 major sports franchises (Thrashers, Falcons, Braves, Hawks) and two major colleges (GA Tech and UGA). Because of such a super-saturated market, a team has to win in order to draw attention. The Thrashers have never had sustainable success, so they have never been able to impress the city's fans. If the Thrashers were a winning team, they would take off in the city. You can't have a team in a city for a decade and finish in the bottom half of the standings in all but 1 season and expect people to come running. Winning puts buts in seats. The problem is not ATL's hockey fans, its having an ownership who doesn't really understand that they own a hockey team (they own the Hawks as well) and are embroiled in a long standing lawsuit.

Do yourself a favor and look up the ATL Flames history before you start using their movement as an reason to hate on ATL. Omni Sports (Group (the flames ownership) was just about as inept as Atlanta Spirit, LLC (Thrashers Owner). They did not have the capital to own or run a professional hockey team. Ownership never struck a contract for local television broadcasts and they never did a whole lot for the promotion of the sport, hoping the novelty of Ice in ATL would keep people coming for ages. Omni Sports got an offer and sold as quickly as they could. They were in over their heads and just wanted out. Another case of piss poor management leading to franchise movement. Also, the Flames never won a playoff series. Winning one of those does wonders for a teams fanbase.

Look at Dallas since the lockout. The Stars are a team with traditionally good attendance/revenues, but after multiple years of bailing in the first round, support started to wane. Dallas went to the WCF last season and the city has responded in kind. "Casual fans" respond to winning teams, and Atlanta has never had a consistently winning team.

After our first playoff appearence (even though it was a sweep) season ticket sales were through the roof. Those purchasing packages were rewarded with a horrible product on ice and a rash of games where anybody could buy a ticket for less than what the season ticket holders paid (ticket prices were dropped as much as 50% for some games). A horrible product combined with giving out such ridiculous discounts has led to the incredible drop in renewal rates. The sad part about this is that most ATL fans saw this coming.

One more thing, Atlanta has had an NHL team for a total of 16 seasons. That is 2 teams who have a combined existence of less than HALF of the second youngest franchise in ATL (the Hawks are next with 42 seasons).

 
At 12:48 PM, October 07, 2008, Anonymous Anonymous said...

Once Kovalchuk leaves and Waddell gets an even worse return than what he got for Hossa, that will be it for the franchise.

 
At 1:22 PM, October 07, 2008, Anonymous Anonymous said...

Let's move Thrashers to Stockholm where their 15,000 looks pretty good in 13,000 seat Globe Arena.

 
At 1:31 PM, October 07, 2008, Blogger Hawerchuk said...

The NHL has simply made gross strategic error after gross strategic error. No disrespect to the serious fans in Atlanta and Nashville, but I just don't think the NHL was destined to succeed in medium-size markets that 1) do not typically produce NHL players; and 2) don't have a large Canadian/Northern US ex-pat population. Every household is a potential NFL or NBA fan, but this is not true for hockey.

The new CBA attempted to guarantee that teams wouldn't move or fold, but it was also predicated on a 63-cent Canadian dollar.

The NHL could have introduced revenue sharing and a salary cap to keep teams from moving at any time in its history but it did so at a time when it had already let its northern franchises (Winnipeg, Quebec City, Minneapolis, Hartford) move away and to protect non-traditional hockey markets.

This was probably the right strategy for revenue maximization during 1992-2004, but it is not the right strategy right now. And yes, it probably does reveal a bias against Canadian markets - one which was to some extent justified during salary expansion because of the weak Canadian dollar.

 
At 1:43 PM, October 07, 2008, Anonymous Anonymous said...

On top of everything, they have Ondrej Pavelec, who now thinks he's Patrick Roy...

The question is really whether he wants out or in...

 
At 2:44 PM, October 07, 2008, Blogger Andrew said...

The thrashers are going to be in Atlanta for a long time. They are part of the deal that brough Phillips to Atlanta. They are the sole reason that place was built and since it has a 100 year lease on the land it sits on, they aren't mving anywhere. Not to mention the Hawks also have to move if the thrashers move too since they are half lessees of Phillips Arena as well. Nashville goes first and Atlanta is going to actually surprise people this year

 
At 2:45 PM, October 07, 2008, Blogger The Falconer said...

Hawerchuk:

For a stats guy I'm a big surprised you would make the mistake of lumping Atlanta and Nashville together.

Atanta has 5 million people, it is not a "mid-sized market" and it is roughly 2.5 times the size of Nashville.

Atlanta has almost 1 million "yankee born" people. There are almost as many "yankee born" people in Atlanta metro as there in Buffalo.

Between the Flames and Thrashers this market has had 15+ years of NHL hockey and a whooping total of 3 playoff wins all time IIRC. No NHL team in Atlanta has ever advanced in the playoffs.

Really what NHL market has embraced that sort of performance? Why should intelligent consumers buy that product?

 
At 2:46 PM, October 07, 2008, Blogger FrenchCatalogues said...

This comment has been removed by the author.

 
At 2:48 PM, October 07, 2008, Blogger FrenchCatalogues said...

In reference to Andrew. This is true. It'd be a great loss of money to separate the teams and the building.

 
At 4:08 PM, October 07, 2008, Anonymous beingbobbyorr said...

Bravo, Bettman....hockey for uncomprehending and disinterested Southern Americans has really energized the sport. Nothing makes a league look better than having 15% of its teams on a franchise death watch.

Look, only Tom Benjamin outpaces me in the "Bettman is a tool" competition, but Gary's job, by all accounts, was to position the NHL to be able to win big national television contracts from American broadcasters. Thus, the American expansion to attain the geographical footprint he needed to lure network interest -- even if that included looking the other way while owners in smaller Canadian cities sought buyers . . . . any buyers -- was wholly logical, given the goal he was tasked with.

When Canada gets the population size, productivity, & purchasing power comparable to the USA*, then you can drive the NHL. Until then, things are the way they are.


* 'course that could be any minute now, the way Wall Street is going

 
At 4:17 PM, October 07, 2008, Anonymous er said...

falconer,

what exactly do you mean by "roots for winners"? i was in atlanta for 4 years (for college) and had no problems going to any braves world series games (as a yankee fan).

to me, atlanta will always be a college sports town. SEC football and NASCAR are what people care about, no?

i have no problem with the existence of a NHL team in Atlanta. i just have a problem with people expecting the franchise to have a ton of support when perennial winners like the Braves had lukewarm support over the years.

 
At 5:05 PM, October 07, 2008, Blogger Hawerchuk said...

Really what NHL market has embraced that sort of performance?

Attendance in ATL was down 20% by year 3. That didn't happen in Columbus despite its own awful record.

For a stats guy I'm a bit surprised you would make the mistake of lumping Atlanta and Nashville together.

Other than New York, LA and Chicago, no market is large enough to guarantee interest in a hockey team. Atlanta's not that big; and Nashville's not so small that we should be comparing it to Buffalo or Edmonton. Among the expansion cities, Atlanta and Nashville are more similar to one another than they are to any other cities.

I think we can understand the strategy (chasing new markets and a US TV contract) and that it failed in several markets.

 
At 7:55 PM, October 07, 2008, Blogger The Falconer said...

Hawerchuk said: "Atlanta's not that big; and Nashville's not so small that we should be comparing it to Buffalo or Edmonton. Among the expansion cities, Atlanta and Nashville are more similar to one another than they are to any other cities."

Atlanta is much more like Dallas than it is like Nashville as a market. Just look at the data.

Metro Population in Millions
18.8 New York-NJ
12.4 LA-Anaheim
9.5 Chicago
6.1 Dallas
6.0 S.F-Oak-S.J.
5.8 Philadelphia
5.4 Maimi
5.3 Washington
5.3 ATLANTA
4.5 Boston
4.5 Detroit
4.2 Phoenix
3.2 Minn-St.P.
2.8 St. Louis
2.7 Tampa
2.4 Denver
2.4 Pittsburgh
(1.9 Kansas City)
(1.8 Las Vegas)
1.7 Columbus
1.5 NASHVILLE
1.2 Buffalo
1.0 Raleigh-Cary

Atlanta metro is THREE times as large as Nashville and TWICE as large as Tampa. The market is in fact LARGE, it just doesn't have a quality hockey product worth purchasing. Atlanta has added 1 million people in the last 10 years alone--that's roughly the same as adding the city of Buffalo or Edmonton to the metro area. Leaving this market without testing its ability to support a quality hockey team would be silly.

I wouldn't compare ATL and CBJ as CBJ is not a southern market. I think a valid comparison would be to other sunbelt markets such as DAL, WAS or TBL.

What's the difference between Atlanta and Dallas? Dallas inherited a much better team.

Atlanta's first 8 years have been very similar to Tampa's first 8 years--one playoff appearance and a ton of bad hockey teams. The result? Tampa had a terrible time selling tickets until they started winning.

Washington is another market where ticket sales are correlated with the on-ice product (when I lived in DC I had Caps tickets).

Atlanta is a city of transplants (including Yankees and Canadians--they all play in my local hockey leagues), the Thrashers need to win to get attention down here. In the history of this franchise most of the attention has been negative.

 
At 11:27 PM, October 07, 2008, Blogger FrenchCatalogues said...

Also, ticket prices went up this season. Some people simply couldn't pay for them. In case you haven't noticed, we are in a bit of an economic crisis and not too mention in the past two weeks Atlanta hasn't had any gas because everyone here drives cars. People can compare us to places like Chicago and New York in terms of having major league teams, but that isn't the right comparison. Atlanta is simply not built like those cities. We are an urban sprawl much like LA. It's not like we can just get on the train and go to a Braves game. There are only two lines on our subway system. Oh and we are so much bigger than Nashville. According to the latest census we are in the top ten metropolitan areas in the United States officially. Also, According to the ranking of world cities undertaken by the Globalization and World Cities Study Group & Network and based on the level of presence of global corporate service organizations, Atlanta is considered a "Gamma World City."So please get your facts straight. Also, Atlanta isn't about NASCAR, demographically that is a dumb assumption. That's North Georgia that's into that.

 
At 12:03 PM, October 08, 2008, Blogger Hawerchuk said...

Take a look at the top 20 teams in terms of revenue (from the 2007 Forbes list). All of the Canadian teams are there. Then New York, Detroit, Philadelphia, Boston, Colorado, Minnesota, Chicago, Buffalo.

There are four cities from outside the hockey player-producing area: Los Angeles, San Jose, Dallas, Tampa.

Los Angeles is big enough to support its teams. San Jose is an incredibly well-run franchise and has some market advantages. Dallas supports a good team. And Tampa was all set to move to Winnipeg before their Stanley Cup run built them a brand.

Essentially all but the absolute largest market outside of the region where people play hockey can't support a team unless it can win the Stanley Cup. That's not a foundation for expanding to that region. It doesn't matter that Atlanta has 5.3M people - the same size as Toronto, with its poorly-run, poorly-performing team - it doesn't seem to be a sustainable NHL market.

 
At 3:59 PM, October 08, 2008, Anonymous keith said...

"And can someone tell me why exactly Winnipeg was bad for this league?"

Because, Anonymous, Winnipeg did not support the Jets, the team lost money, and absolutely NOBODY wanted to own that team in that market.

You can whine all you want about Bettman forcing the NHL into markets like Atlanta (he was only part of the expansion committee, not the whole, and regardless, he got his mandate from the owners) But Winnipeg's first go around in the NHL was equally as bad as Atlanta's.

So, if Atlanta didn't deserve a second chance, neither does Winnipeg.

 
At 4:31 PM, October 08, 2008, Anonymous exwhaler said...

>>"Take a look at the top 20 teams in terms of revenue (from the 2007 Forbes list). All of the Canadian teams are there.<<<

As I pointed out at the time, that revenue list translated Canadian dollars into the then-much weaker U.S. currency, which greatly boosted the Canadian teams' numbers. Compare overall paid attendence in relation with revenue, along with merchandise sales, then you might have an arguement. That list proved very little, outside of the fact that the Canadian economy was stronger (and that Phoenix is in real trouble). It wasn't too long ago that Canadian teams were complaining that they were too small market with a weaker dollar to financially compete with some American teams. Remember when Ottawa went bankrupt, along with Buffalo? That was only 2003. So much for historically strong hockey markets.

The real issue with Atlanta, outside of an inept ownership, is that they're a recent expansion team that never has had any lasting, real success. Tampa Bay and Carolina both have won Stanley Cups, and they now have solid attendence despite being non-playoff teams for the past two seasons. Dallas and Colorado are great examples of how team success can build the sport in a non-traditional market.

Bettman moving the sport into non-traditional markets wasn't wrong; it was necessary to grow the sport beyond a limited northern market. What was wrong was that the NHL did too much too quickly: opening up new franchises (Sharks, Lightning, Predators, Ducks, Panthers, Thrashers) and moving established but troubled teams to new markets (Hurricanes, Stars, Coyotes, and Avalanche) sacrificed the financial stablity of the league for risky markets. While Carolina now supports the Hurricanes, that franchise initially did much, much worse for years than it ever had done in Hartford, which hadn't had a decent playoff team in about seven seasons before it moved. That wouldn't have been in an issue if the league also wasn't trying to expand the sport in a dozen brand new markets over the course of a decade.

 
At 10:35 PM, October 08, 2008, Blogger The Falconer said...

Hawerchuk. So you're still going to lump Atlanta (5.4 million people) in with Nashville (1.5 million)?

If you look at the NHL in non-traditional markets it seems that there are two conditions necessary for success:

A) A large market
B) A decent hockey product

Honestly I have some doubts about the smallest southern markets such as Carolina and Nashville--it will take a HIGH level of support to sustain these teams over the long haul. The same goes for Buffalo--the market is small and they need a high level of fan support to make it work there.

Bigger markets such as LA, Phoenix, Dallas, Atlanta, Maimi, Washington and Tampa have the size. The key variable is quality of their hockey product.

Fans in Phoenix, Maimi and Atlanta have precious little to get excited about since their teams arrived--a problem not dis-similar to that of markets such as Winnipeg and Hartford and for some years Vancouver.

Dare I mention the "Dead" Wings era? It seems that fans in other NHL cities have expressed their displeasure with a poor hockey product by staying away.

I think lumping Nashville and Atlanta together is a big mistake. Nashville has had fairly competitive teams but because of its small size and weaker corporate support that market struggles.

Atlanta has a much larger population and corporate base but has no record of fielding a competitive team. Which is easier--building a quality team in Atlanta or doubling the population of Nashville?

 
At 10:58 PM, October 08, 2008, Blogger James Mirtle said...

Buffalo's saved by being a border city. A very high chunk of their ticket sales go to Canadians.

 
At 3:09 AM, October 09, 2008, Blogger Hawerchuk said...

exwhaler - as I noted in one of my earlier comments, southern expansion was a good strategy in the context of a weak Canadian dollar.

But the new CBA is essentially designed to keep the necessary franchise movements of the 1990s from happening now. Winnipeg, Quebec and Hartford couldn't survive and so they moved to other markets that might support them. Now that the Canadian dollar is worth 60% more, it would make sense for some teams to move in the other direction, but it's not going to be allowed to happen.

League revenues aren't static, and at least 10 markets are so marginal that they need optimal economic circumstances to survive. The NHL used to accept team movement in response; now it doesn't.

As for Atlanta and Nashville, yes, I am putting them in the same basket. In 2008, outside of the north, you need a massive American market to support a team that hasn't won the Stanley Cup recently. Atlanta's the biggest of the remaining non-traditional markets and it's not big enough!

 
At 9:43 AM, October 09, 2008, Anonymous exwhaler said...

>>>"Now that the Canadian dollar is worth 60% more, it would make sense for some teams to move in the other direction, but it's not going to be allowed to happen."

And it shouldn't happen. Moving franchises--a long-term investment--based on the current strength of the Canadian or American dollar is an insane financial decision. Traditionally, the Canadian dollar has been weaker than the American; what happens when the economy improves and all those teams you moved suddenly become reveue-weak again, despite good attendence?

Think about that, 'cause right now, the Canadian dollar is worth less than the American one. Check any exchange rate site.

When the NHL moved teams, it did so based on two criteria--larger potential markets with more corporate backing, and a view to expand the sport outside its glass ceiling of the northern part of the continent. For good growth of the league, it had to expand to those markets. My issue is that they did too much too soon, but turning around and moving those franchises *again,* especially teams that are expansion teams, doesn't fix the problem. It only hits a reset button of building or rebuilding a fanbase, while ignoring the real crux of the issue--long-term inept franchises will not draw fans in *any* market, whether you're Atlanta, Pittsburgh (see pre-Crosby), or Chicago. The only exceptions are Toronto and New York, and they've won Stanley Cups in their past.

People have long considered Washingon, DC, a football town because of the Washington Redskins. What they don't remember is that until the Redskins starting winning in the 1970s and won some Super Bowls in the 1980s, they didn't draw and struggled financially every year. Now, despite nearly two decades of losing, they still manage to sell out games.

Winning makes franchises. Atlanta hasn't won anything, and they've been the doormat of the Southeast for all but a couple of their 9seasons. They haven't even been around for a decade, yet you're going to compare them to franchises who have been entrenched in their markets for a couple of generations. Yeah, that makes sense.

 
At 1:22 PM, October 09, 2008, Blogger The Falconer said...

>>>Mirtle: The Canadian contribution to the Buffalo market is probably exaggerated. Last season the Sabres sold out the vast majority of their tickets in advance via ticket plans. A team official was quoted as saying that only 10-12% of ticket holders live across the border.

Certainly Canadians purchase a higher percentage of single game tickets, but the last two season those single game tickets have been scarce.


>>>Hawerchuk: Detroit was a "failed market" with a bad team 1975-1985. The Blackhawks failed to generate much revenue in the 3rd largest "traditional" market. Boston continues to have tepid attendance despite fielding playoff qualifying teams.

Clearly the quality of the hockey product matters in virtually every market other than Montreal or Toronto. EVEN big northern cities turn those nose up at a long run of stinkers.

"In 2008, outside of the north, you need a massive American market to support a team that hasn't won the Stanley Cup recently."

Atlanta is a top 10 USA city. It is a fast growing and could rise above Philadelphia in the not so distant future. To continue to insist that it isn't a big market is just spitting on the data. Unless your definition of "massive" is just NYC and LA.

 

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