SBJ/April 2-8, 2012/Franchises

Sabres stay focused on goals, despite bumps

The Buffalo Sabres will win the Stanley Cup — sooner or later. That’s according to President Ted Black, who likes the path the team is on.

That path has been a bumpy one. The season began with high-profile trades, a new name on the arena, a rash of player injuries, a seven-week period where games weren’t shown on Time Warner Cable, and the threat that the team might miss the playoffs.

All in all, Black says things are good with the franchise.

“I like the trajectory we’ve put in place,” he said. “I’m bullish on what we’re going to accomplish here.”

He was referring to winning the Stanley Cup.

When Terry Pegula took over the team in 2011, he took aim at winning the Stanley Cup.
Photo by: ICON SMI
On Feb. 22, 2011, when Terry Pegula took over as Sabres owner, Pegula famously said: “Starting today, the Buffalo Sabres’ reason for existence will be to win a Stanley Cup.” And if fans want to hold him to that, Black is totally fine with it. “It may not be this year or next year,” he said, “but it’s going to happen.”

Black joined the team when Pegula took over. And if Sabres followers are waiting to hear that the team is losing money or needs to advance to a certain playoff round to make money, they shouldn’t. That message isn’t coming. He said he is aware that in previous years, many worried about the team’s financial stability.

And while Pegula may talk about the state of the team at season’s end, he won’t talk dollars and cents.

“We don’t need to have that conversation,” Black said. “Terry paid cash for the team. We carry no debt, and the team is being run financially as he sees fit. There’s no need for a state-of-the-team [address] to have a financial report card, and as a business practice, there’s no financial scorecard.”

What Black and other leaders do keep an eye on are ticket sales, which he said can drive 30 percent to 40 percent of a team’s revenue.

Without providing specifics for other financial drivers, he said TV revenue is responsible for the next big chunk.

TV viewership was negatively affected this year when Time Warner Cable and MSG Network, which broadcasts Sabres games, were locked in a stalemate over carriage fees MSG was charging the cable giant.

Black considered that to be this season’s biggest off-ice challenge, saying, “Those types of disputes don’t come along very often, and it caught me a little by surprise.”

He didn’t realize MSG Network would be unavailable on Time Warner until about two weeks before it went away for 48 days on Jan. 1. During that time, Black said he would get emails from parents explaining that their kids weren’t able to watch the games.

Viewer ratings were down for MSG broadcasts, he said, but when the team played a nationally televised game, they were up.

As his first season with the Sabres winds down, Black is proud of selling the naming rights for HSBC Arena to First Niagara Bank, as well as the two months of work that followed to transform the arena to First Niagara Center.

“I’m most proud because from the time we met with [First Niagara President and CEO] John Koelmel to the time we pressed the fake button that lit the lights was about 60 days,” he said. “That’s probably as quickly as anyone has ever done that. It’s a testament to how nimble both organizations are.”

According to Black, Pegula’s lean business model allows decisions to sometimes be made over five-minute conversations. There’s no board of directors to consult.

A year ago, Pegula was seen as a hero who promised to keep the franchise in Buffalo and build a champion. But Black said Pegula would rather remain in the background and attention should focus on the team this time of year. As such, he didn’t grant one-year anniversary and review types of interviews. So Black answered the questions.

“Day to day, Terry is more than comfortable with me speaking on behalf of the business,” Black said.

He also said that as injuries and losses piled up these last few months, Pegula hasn’t lost his passion, composure or resolve.

He admits that the bar was set high for the season. Together, fans and the franchise rode a wave of enthusiasm as they entered the season. And on the ice, the team has not met expectations.

But even if they miss the playoffs, Black said there are no plans to reduce spending or change the way they build the team.

“Hopes were set high, and sometimes you set the bar high and you miss,” he said. “Even high jumpers get three tries.”

David Bertola writes for Buffalo Business First, an affiliated publication.

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