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SBJ/June 25-July 1, 2012/Leagues and Governing Bodies
Nearing milestone, Bettman stays focused on NHL’s future
Published June 25, 2012, Page 1
But in looking back, few could have envisioned the changes that have been made to the NHL since Bettman became NHL commissioner in February 1993. In the last decade alone, the league has implemented a salary cap after a lockout that lasted a complete season; staged regular-season games in historic baseball venues Wrigley Field and Fenway Park; and has taken the game to Europe.
And to tell much of its story, the NHL, like other leagues, has taken media into its own hands.
|Bettman has won support from sponsors and owners for how he has positioned the league.
The months ahead are sure to have people tweeting even more.
Bettman, who turned 60 on June 2, is approaching his 20th anniversary as NHL commissioner. While his supporters note his power and influence, observers watch as Bettman leads the league through one of the more important junctures in its history. The need this summer for a new collective-bargaining agreement tops the list of the issues facing the league.
Bettman doesn’t shy away from the challenges as he sits in his New York office. On a week in which he would participate in the NHL awards and a board of governors meeting in Las Vegas followed by the draft over the weekend in Pittsburgh, he took time to discuss areas where the league can continue to grow, how the postseason ratings decline was not a surprise to him — and the most imminent matter of the league’s CBA.
During the Stanley Cup Final, Bettman reported league revenue of $3.3 billion this season. In the 2006-07 season, the league generated $2.2 billion in revenue. Among the primary reasons for the leap have been increased attendance (the NHL brought in $1.2 billion from ticket sales in 2010-11); the 10-year, $2 billion deal signed with NBC last year; and a seven-year, $375 million deal with MillerCoors that is the most lucrative such deal in league history.
Asked about the growth, Bettman pointed back to the league’s prior labor negotiations, when a deal resulted only after the cancellation of the 2004-05 season. “[We] knew during the year off that [the fans] understood our problems and wanted us to fix them,” he said. “So I wasn’t surprised that with a healthier foundation, we could grow the game in ways the game had never seen.”
The NHL now has locked up many of its major sponsors to long-term deals despite the labor uncertainty that could jeopardize the coming season. Last month, PepsiCo renewed for five years. Last week, the NHL signed York as its first HVAC partner, marking a new business category for the league.
Partners point to the development of a larger footprint around the league.
“For Coors Light,” said MillerCoors CMO Andy England, “it is about tent poles like the Winter Classic, All-Star Game and Stanley Cup playoffs.”
So while the league turns its attention to new business in the packaged goods, financial services, consumer electronics and airline categories, Bettman is satisfied by the votes of confidence the league has received from partners heading into the potential labor difficulties. The current CBA with the NHL Players’ Association expires Sept. 15.
Bettman also has the clear backing of the league’s owners.
“Gary has brought us into the 21st century with a great deal of vigor,” said Boston Bruins Chairman Jeremy Jacobs, chairman of the board of the NHL’s executive committee since 2007. “He has built the business of our league from the ground up. Look at what he has done in retail, in media. He excels because he is evolutionary in his approach — he doesn’t just shoot from anywhere.”
Said Bettman, “It starts with the game on the ice and our great players. When you look at the competitive balance, when you look at the excitement and the entertainment the game has provided, there are people who believe that the game has never been better. In terms of marketing and promoting the game, particularly with this healthier foundation, we’ve been able to do more things.”
As examples, he cited the season-opening Premiere Games in Europe, both the Winter Classic and Canada’s Heritage Classic, the NHL awards, and, in the commissioner’s words, “giving our fans and sponsors platforms to activate against,” a strategy espoused by NHL Chief Operating Officer John Collins.
“From our first cup of coffee together, where Gary spoke about his vision for the league, he has been an incredible leader and huge supporter,” said Collins, who was hired in 2006. “At times, he has pushed hard. At other times, he has asked for patience. But this has been a phenomenal period of growth for the league, and the building blocks are in place for more.”
Although the Winter Classic has been a hit with fans, television viewers and partners such as title sponsor Bridgestone, Bettman dismissed the notion that the event was in the “If It’s Not Broken, Don’t Fix It” category.
“If you follow the history of the Winter Classic, we’ve always done more and more,” he said. “We started in Buffalo, then went to iconic venues. We had open practices. We built the alumni game into a stand-alone event that sold out last year in Philadelphia. In Detroit [for 2013], we’re using two stadiums for a host of events. We’re constantly looking for ways to grow our events and engage more fans.”
Bettman also is confident the Premiere Games will continue after taking a one-year hiatus this coming fall. The NHL has played games in Europe to start the regular season since 2007.
“We’ll be back,” he said. “With all of the uncertainty, and the way we do those games with the players association, everyone thought it was best — especially with the potential of financial risk — to put it on the back burner. But international development is a great opportunity and remains a priority for us.”
The NHL’s current broadcast rights holder deal with NBC gives the league $2 billion over the
|The Winter Classic’s alumni game (top) and Premiere Games have given sponsors more events to activate against.
“I say this partially tongue-in-cheek, but we may be the single biggest beneficiaries of the NBC Universal[-Comcast] merger,” Bettman said. “We get the production, the promotion, the scheduling, the star treatment that NBC gives us. It’s phenomenal. We are an absolute priority for them. Putting aside the increase in the rights fee, the most important element of this deal was the continuous coverage.”
Of course, one area for the league where things could have been better was with the ratings for this year’s Los Angeles-New Jersey Stanley Cup Final. The average mark dropped 33 percent from the Boston-Vancouver series of a year ago.
Bettman saw the numbers, and while he didn’t like them, he’s not spinning. “It’s not surprising,” he said of the Cup Final ratings. “We’re still looking to engage nationally, and we’re probably still a little more matchup-sensitive than others. As compelling and as exciting as it was for Kings and Devils fans, the local ratings were very strong, it doesn’t catch on nationally at the same level as an Original Six matchup that’s so much a part of the history and tradition of the game.”
He also was not alarmed at the 14 percent drop in the ratings overall from last year’s playoffs.
“This was the first year in our history that every game in the Stanley Cup playoffs was televised in the United States,” Bettman said, noting the coverage that extended from NBC and NBC Sports Network to CNBC and NHL Network. “As we continue to grow, and based on everything NBC is doing for us, you will see our ratings grow.”
Added England of MillerCoors, “Building the playoffs into a two-month version of March Madness is something we bought into. The NBC deal is going to make the NHL a lot bigger.”
In cases from Long Island to Phoenix, and in Atlanta in between, Bettman has been determined — many would say stubbornly so — about not wanting to see franchises relocated.
“Fans of a team make an investment,” he said. “It’s emotional, it’s financial, it’s their time. That’s not something we treat lightly. We only consider moving franchises as a matter of last resort when there are no alternatives. What we’re doing in Phoenix is no different than what we’ve done in other places. … Hopefully, the Phoenix situation will play out successfully.”
While the future of the Coyotes is his most immediate franchise concern, Bettman’s attention is also commanded by the plight of two franchises within driving distance of his Manhattan office: the New York Islanders and the New Jersey Devils. The Islanders have been playing in outdated Nassau Coliseum for more than a decade and need a new home. Their arena lease ends in 2015, and a move to Brooklyn is a possibility. Devils owner Jeff Vanderbeek is expected to introduce a new investor in the coming weeks. Without one, his team faces bankruptcy.
Because of his strong will to see franchises stick, the relocation of the Atlanta Thrashers to Winnipeg last summer was viewed as one of Bettman’s biggest disappointments.
“We didn’t make the decision that we’d rather be in Winnipeg than Atlanta,” he said. “The fact is, no one was prepared to own the Thrashers anymore in Atlanta. Circumstances dictated that we had no choice to move.”
Uncomfortable talking about himself, Bettman is hesitant to discuss what makes him tick. But he shed some light on his process when asked if he would take even a brief moment between presenting the Stanley Cup to the Kings and the start of CBA negotiations to savor the league’s successes.
“This isn’t an organization that sits around, looking backwards, to see where the pats are coming from,” Bettman said with a grin. “This is an organization that is committed to continuing to grow the game, to work hard, to move forward. We don’t sit around, trying to enjoy the moment. We sit around and discuss what we can try to do next.”
Collins laughed in recognition when told of his boss’s comment.
“We’re really happy with where we are, but we see the opportunities before us as significantly larger,” Collins said. “As [Washington Capitals owner] Ted Leonsis recently said to us, ‘The lights are all green.’”
“I wouldn’t say he has mellowed,” said Octagon CEO Rick Dudley, who knows Bettman well having been president of NHL Enterprises from 1997 to 2002, “but he is more relaxed.”
Next on Bettman’s agenda are negotiations with the NHLPA for a new CBA. No matter what transpires, few will question the level of trust and faith NHL owners have in the commissioner.
“The key to any commissioner is ownership support,” said Dudley, “and Gary definitely has that.”
Said Jacobs, “When you have 30 people together who can afford to own a hockey team, there are going to be a lot of strong opinions. But I can tell you, Gary has the support of all 30 clubs. We all believe in his direction.”
Bettman smiled slightly when hearing the praise and explained what motivated him.
“I’ve just always believed that you have to work hard, you have to communicate well, you have to understand what franchises are thinking, what they need and what’s important to them,” he said. “Most of all, you have to have a passion to do it. None of this works if you’re not passionate about the game or about the people in the game.”