The Kontinental Hockey League of Russia launched as a 24-team league last year with designs to challenge the NHL for players and international interest. As the league wraps up its first season, its executives have found that the international economic crisis has made that effort more difficult than first imagined. KHL President and Gazprom Deputy Chairman Alexander Medvedev sat down between periods of last week’s New York Rangers-Washington Capitals game with staff writer Tripp Mickle to discuss the state of the league and the impact of the economic crisis on it.
How has the first season gone?
Medvedev: The season goes well. The support level is higher than before. Obviously the crisis is not a very nice event, but all the teams will finish the season, and recently the board of directors took a comprehensive package of anti-crisis measures, which is targeted not just to survive but develop.
How has the economic crisis affected the league?
Medvedev: The league is in very sturdy shape, but some clubs [are] facing situations where sponsors’ and owners’ cash flows are diminished.
Medvedev: “Three or four
teams are facing problems.
… The rest are in
good shape.”
What are you doing to offer relief to those owners and sponsors?
Medvedev: We decided that players should receive adequate salaries. We believe there was unnecessary escalation of salaries in recent years and [the] crisis has put it in order. In this season, all salaries will be paid, but next season there will be new regulations [including reducing the salary cap per club from $24 million to $17.4 million]. Also, we decided temporarily to eliminate the status of free agents until the crisis [is] over.
Have any teams had to change ownership or bring in new investors?
Medvedev: We would like every team to continue, but we are not sure every team will be in position to comply with the financial requirements. Just three or four teams are facing problems. All the rest are in good shape.
What do you need to do to drive revenues across sponsorship and ticketing?
Medvedev: The standard of living is below Europe and America, and that’s why we will never raise prices of the tickets to the level we see here. That’s why TV rights and sponsorships and money from owners will be major sources of cash for the clubs. Sponsors should get a good product with proper TV broadcasts.
Broadcasting live games this year has been an issue. Where does the league stand on that?
Medvedev: In two to three years, we will have proper local and international broadcast coverage. That’s why I’m rather sure that KHL will expand its activity to Europe.
How would you describe the relationship right now between the NHL and KHL?
Medvedev: Actually, I’m frustrated with where we stand because isolation will neither benefit the KHL or NHL. We will never come back to the situation where it was a one-way street between Europe and North America. The NHL should understand that the world has changed and cooperation is the only option.
When you say cooperation, what do you mean?
Medvedev: We should complete a transfer agreement. We should create a club competition as well as national competition. Objectively, fans like international competition. Many specialists share the view that 82 games [like the NHL plays] in the regular season is too much.
