NHLPA's Kelly: Folly not to expand into Canada

[ThomasTomasz]

Characteristically, it took an American to tell Canadians that they should be better served by the NHL.

Paul Kelly, the Boston lawyer who's now the executive director of the NHL Players Association, believes Canada should have at least one -- and perhaps more -- NHL franchises if the league relocates a team or expands.

"I think it would be a huge error not to relocate one of the existing franchises to Hamilton or Winnipeg," Kelly told the Toronto Star when asked about where failing U.S. franchises might move.

Kelly then pointed out that it's folly for the league to blackball RIM billionaire Jim Balsillie, who wants to bring another team to southern Ontario.

"He built his company from nothing into an $80-billion company. We would be foolhardy not to see his efforts happen."

(Kelly subsequently told the Herald by e-mail that this is an issue he will be pursuing, and that getting teams to Canadian markets where they can be more profitable is in the NHLPA's interest.)

The impetus for Kelly's remarks about Balsillie is a couple stories in the past few days.

First, the Star produced an internal NHL financial document that supports our contention that the rise in the Canadian dollar and the performance of Canadian teams is obscuring major problems elsewhere in the league -- problems not solved by the draconian lockout.

The report says the six Canadian teams account for 31 per cent of the $1.1 billion US in league ticket revenue.

While ticket revenues from Canadian sources have pushed NHL revenues by almost 10 per cent -- and the NHL has trumpeted record attendance numbers -- 11 of the 24 U.S.-based clubs were either revenue-flat or lost ticket income in that period.

In spite of the financial changes brought on by the new CBA, a number of teams are facing huge obstacles to survival in their markets.

According to the report, Phoenix (which generates a puny $450K per game), Atlanta, Miami, Nashville, Washington, St. Louis, the Islanders and Chicago generate less than half the ticket revenue per game as do the least profitable Canadian teams, Edmonton and Ottawa (which make about $1.2 million per game).

In short, despite Bettman's most tortured efforts, the sport is not growing financially in the U.S. -- except at the level of franchise equity. That remains buoyant thanks to Balsillie's efforts at purchasing a team at above-market value.

Franchise equity is the darling of owners, of course, and that accounts for Bettman's rock-solid support within the board of governors. So the commissioner is under no pressure.

However, the release of the report during the Stanley Cup final is a major embarrassment to the NHL, as it tries to show the boosted American TV ratings as a sign of a turnaround.

Not helping Bettman's blood pressure, either, is the recent string of financial misery for owners he's championed around the league. That's the other story.

The league has promoted William "Boots" Del Biaggio as the saviour of hockey in Kansas City. (Ooops, I should have said Nashville, right?)

In any event, the man who's reportedly the money behind the Predators resigned abruptly last week from the investment company he created.

Seems he's being sued for allegedly scamming $3 million US in a loan deal.

There's also a federal probe into the finances of the 40-year-old Bay Area socialite.

None of the claims is proven in court, of course. But it's hardly a ringing endorsement of the NHL's due diligence if Del Biaggio comes a cropper.

Then there's Anaheim owner Henry Samueli, who resigned last month as chairman of Broadcom Corp. to fight a federal lawsuit alleging he conspired in a five-year scheme involving false accounting and lying to shareholders.

To say nothing of the ongoing securities problems for Ottawa owner Eugene Melnyk.

It all smacks of the John Spano fiasco, when the NHL's due diligence approved him as the new owner of the Islanders, only to see him carted to jail for fraud a short time later.

And the conviction on fraud charges of Buffalo owner John Rigas and his son.

Then there was Bruce McNall . . . 'nuff said.

That brings us back to the purported unsuitability of Balsillie.

The American leader of the NHLPA wants the BlackBerry Guy to add more Canadian content to the NHL.

Wayne Gretzky has added his voice, saying Hamilton is a bona fide market. But, so far, the Canadian voices in the ownership are silent.

It's self-evident that hockey is Canada's game and passion. Southern Ontario -- at the very minimum -- should have a team.

But who will bring that message to NHL headquarters in Manhattan, where Bettman seems more concerned with rescuing

the deadbeats he brought into the league than bringing real money, energy and hockey passion to the sport.

http://www.faceoff.com/hockey/column...9-53f345ecdfdd