Accept that Houston will receive an NHL team. But that doesn’t mean Seattle gets left behind. In fact, recent conversations with two high-ranking NHL sources have indicated the league wants both Houston and Seattle to have teams.
Inside sports business
With a week to go before the Seattle City Council votes on whether to approve a Memorandum of Understanding for a $600 million renovation of KeyArena, there is concern among local hockey fans about a new Houston effort for an NHL team.
Because Houston is a bigger market and already has an arena built, the fear here is that it is a candidate to steal our hockey-expansion hopes. Reports surfaced this month that NHL commissioner Gary Bettman had met with new NBA Rockets owner Tilman Fertitta to explore putting a team in Houston’s Toyota Center.
There are legs to this story beyond rumor. The NHL has long coveted the nation’s fourth-largest city, which, as I’ve written before, has been shown by studies to still have ample financial capacity among its wealthy population for additional sports despite already enjoying NFL, NBA, MLB, MLS and major NCAA teams.
So accept Houston will receive an NHL team after years of being blocked from doing so by previous Rockets owner Leslie Alexander.
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That doesn’t mean Seattle gets left behind. In fact, recent conversations with two high-ranking NHL sources have indicated the league wants both Houston and Seattle. And why wouldn’t it? You’re talking about the nation’s No. 8 (Houston) and No. 14 (Seattle) media markets, and Seattle offers potential for a much bigger geographical TV footprint spanning a multistate territory.
Now, don’t expect the NHL or Bettman to confirm this. They’ll insist adding cities isn’t on their agenda until it actually is.
No matter. Here’s what we know:
The NHL has two major headaches with franchises it wants to resolve, involving the Calgary Flames and Arizona Coyotes. The Coyotes have run out of goodwill from the City of Glendale with their arena lease about to expire and nobody yet offering a public-funded venue elsewhere.
With the Flames, who moved to Calgary from Atlanta in 1980, the situation also involves a lack of local political will to build a new, taxpayer-funded arena such as the one in Edmonton a few hours north.
Unlike Phoenix, Calgary is a rabid hockey town. But also, quite unlike Phoenix, Calgary offers limited relative financial upside for the league.
There are 4.15 million people living in the province of Alberta, which, as mentioned, has another franchise in Edmonton. But the greater Phoenix area of Maricopa County has 4.17 million residents, with the Coyotes the only NHL game in town.
Right there, you see why the NHL has shown more patience with the Arizona team than it recently has with Calgary.
Hey, as a born-and-bred Canadian, I hate that thinking. But it’s been the NHL reality for decades.
In my home province of Quebec, the NHL allowed the Nordiques of Quebec City to move to Denver in 1995. My hometown Montreal Canadiens barely uttered a peep, despite losing one of sports’ fiercest rivalries. The Canadiens, as has been well documented, tried to block the Nordiques from joining the NHL during the league’s merger with the World Hockey Association in 1979.
Back then, as with today, it was all about business and market share. The teams were owned by rival brewing companies. They cared less about on-ice wars than winning the battle of beer sales. And the Canadiens loved having an NHL monopoly in a province of 6 million people through which to market beer.
Nowadays, it’s all about online merchandising sales and TV market share. The Canadiens again have cornered that NHL market in Quebec for more than two decades since the Nordiques left. And though Montreal owner Geoff Molson recently said he wouldn’t oppose the Nordiques returning, the NHL hasn’t shown much enthusiasm about Quebec City’s 2015 expansion request.
So that’s why, as bad as the Arizona situation has been, the league is still pondering whether it’s better off staying in the Phoenix area to work out a deal than remaining in Calgary.
Right now, the league wants to relocate no more than one of the two franchises. And the league’s head office and board of governors are mulling which to move.
The idea is either Houston or Seattle would receive the relocated team. Then the other city would receive an expansion squad.
Houston and its existing arena could handle relocation right now. Our city won’t have KeyArena redone for three years, if the MOU is approved.
But an expansion team would cost up to $650 million. Relocating a franchise would cost about $300 million.
Here in Seattle, with the Oak View Group already pledging to redo KeyArena without teams guaranteed, paying a smaller relocation fee undoubtedly would help its bottom line. Especially when it comes to later sharing revenues with an NBA franchise if it comes.
But that would mean the NHL waiting several more seasons to relocate a lame-duck team. Or playing temporarily at the Tacoma Dome or an expanded Everett venue.
My money remains on Houston for relocation and Seattle for expansion. However that shakes out, the league would balance out at 32 teams, 16 in each conference.
Quebec City? A fallback plan in case another eastern-based team — such as the Carolina Hurricanes — needs to be moved.
But again, the league’s belief is that it largely maxes out on hockey dollars with one team in each province. And that having two teams doesn’t grow the overall money pool much.
Adding lucrative U.S. markets is far more important. Houston is one, Seattle another.
The two don’t have to cancel each other out. Expect both to factor in to the league’s near-term plans once Seattle gets its arena question resolved.