Getty ImagesIn the NHL's last proposal before the lockout started, the League offered a deal "in which the players get 49 percent of hockey-related revenue in Year One, 48 percent in Year Two, and 47 percent over the final four years," according to Mirtle.
Now why would the owners want that decline in the players' share over time? Could it be the Canadian television rights windfall coming to the League in 2014? Sure.
Could it be expansion to two lucrative Canadian markets during the term of the next CBA?
That's been the speculation for a while, and Jason Kay of The Hockey News turned up the heat last week:
There's strong speculation the NHL could announce two expansion teams for Canada once CBA deal struck: Quebec & Toronto. More in Oct. 29 THN
— Jason Kay (@JKTHN) October 11, 2012
Massive new streams of hockey-related revenue? Check. Dozens of new jobs for NHL players, in markets they've been clamoring to receive teams? Check. Appeasement of bitter Canadian fans who would suddenly shower Gary Bettman with candy and flowers like the good people of Winnipeg did? Check.
In some ways, this isn't a surprising comment. It's been more than a decade since the NHL's last wave of expansion, and there have been a number of hints that the league sees itself at 32 franchises eventually — including the attempted realignment to four divisions this past year. There's a new arena being built with public money in Quebec City and in Pierre-Karl Peladeau there's a rich man well-positioned to own a team. Meanwhile, the Toronto Maple Leafs are far and away the league's most profitable franchise — at least based on Forbes' estimates — and there is no question that the market could sustain a second profitable team (though it likely would impact both the Leafs' and the Buffalo Sabres' bottom line).
Polarizing agent Allan Walsh said recently that expansion fees could reach $500 million per team. That seems a bit high, but the message is clear: Expansion will bring the league a lot of money, and those fees get divvied up by the 30 existing teams. That's a really great, simple way to make up for revenue lost in a lockout.
The Maple Leafs are also set to make a bunch of money in the event a Markham team enters the league. Toronto holds the territorial rights in the region and, according to the NHL's constitution, they'd have to give written consent to a team that wishes to play within 50 miles of the Toronto city limits. Markham would have to pay for that consent.
The territorial rights thing, in my conspiratorial mind, was settled on a handshake when Rogers and Bell were approved to buy the Leafs; hey, who do you think would get the television rights for a second NHL team in Toronto?
I've long thought that the NHL would expand to Toronto and Quebec City and then relocate to Seattle when the time was right. First, because Seattle probably needs an NBA tenant first, and because relocation is less costly than expansion; which is why, second, the NHL could bleed millions from hockey-starved owners in those Canadian markets, who know their investment will eventually be recouped.
Toronto's a slam-dunk; even as the Clippers to the Leafs' Lakers, they'll print money in that market. But Quebec City isn't a sure-thing for expansion. First, because they're seen as a "lower limit" city that would need a strong Canadian dollar to remain viable.
Second, because they're doing it wrong: Winnipeg kept it on the down-low and landed Atlanta; Jim Balsillie sold season tickets to the Hamilton Predators, and was frozen out to the point where he needed a bankruptcy court to try and secure him the Coyotes. I'm not saying the Quebec group's money is no good for the NHL; but Bettman likes these things pulled off in a less public-posturing way.
There's a difference between if the NHL will expand — from a revenue perspective, those two markets should be slam-dunks — and whether it should expand. Is the talent pool there for two new teams? Does it water down a parity-stricken product even more? Is 32 teams too many? Would the Stanley Cup Playoffs need expanding?
I think expansion is inevitable. Do you want to see it happen?