Not to rain on the post-season parade of the Tampa Bay Lightning, one of the best sports stories of the year, but Forbes Executive Editor Mike Ozanian says the Bolts will come up financial losers this year — even if they win the Stanley Cup. Despite being a vastly improved, overhauled product. Despite averaging about 2,000 more fans per game than the season before.
A lot of it has to do with timing — as well as the nature of the National Hockey League.
According to Ozanian’s source, the Bolts will likely post a “pretax loss of around $30 million” — regardless of how far they go in the playoffs. The “Sportsmoney” columnist cites the NHL’s (post lock-out) collective bargaining agreement (initiated in 2005-06) as a key factor. It stipulates that playoff teams must pay the league a six-figure fee to help cover the NHL’s costs to produce the playoffs. The fees subsequently escalate each round.
Moreover, teams are also required to kick back part of their playoff ticket receipts to the NHL’s revenue-sharing program. The upshot: playoff games now mean about $500,000 net per game to the home team, writes Ozanian. The figure would have been more than $1 million under the previous CBA.
The bottom line: Bolts’ owner Jeff Vinik, who got a cash-buyer’s deal when he paid just $93 million for the Lightning package last year, will need more sponsorship revenue and will need to gin up the gate even more. The Bolts ranked 18th (out of 30 franchises) in average attendance –17,348 — this season. That was 87.8 per cent of capacity. (For the record, the Chicago Blackhawks were first — 21,400 — and the New York Islanders 30th –11,000.)
The final factor is TV money. The NHL is not the National Football League or Major League Baseball or the National Basketball Association. When it comes to national TV contracts, the real financial life blood of any major sports league, the NHL is still dealing in relative chump change.
But the final bottom line: Go, Bolts.