Friday, August 10, 2012

NHL Contraction/Expansion Instead Of Relocation?

With the NHL owned Phoenix Coyotes dying a slow painful death, word on the street is that the NHL would rather disband the franchise followed by expansion rather than relocate the team to a new city. This scenario includes holding a dispersal draft to release the entire Phoenix roster to the rest of the league and allows the owners to charge an exorbitant expansion fee rather than simply moving the existing team. The owners will maximize their profits, while punishing the fans of the city about to get NHL hockey.

This is a terrible idea, especially for the city getting a new NHL team. Why? Moving the Coyotes allows the new team a head start by absorbing the existing talent on the roster, a roster good enough to make it to the conference finals last season. Years of draft picks, trades, and free agent signings have allowed Phoenix to assemble an impressive collection of assets that will benefit the fans of Quebec, Markham, or even Hamilton. Disbanding the roster and starting from scratch significantly diminishes how quickly the new team will become competitive.

Of the last 9 expansion teams in the NHL (post WHA expansion) only 2 of them (22%) have won a Stanley Cup, and none made the playoffs in their first 2 seasons (where Colorado won the Cup the year after leaving Quebec). The average number of playoff appearances in the first 10 seasons of these teams was 3. Anaheim made the playoffs 3 times in their first 10 seasons, then won the Cup in their 13th season. Tampa Bay only made the playoffs once in their first 10 seasons, then won the Cup in their 12th season.

Over that same time period (1980-2012) there have been 7 teams that relocated to a new city, and 5 of them (71%) won a Stanley Cup after relocating (Winnipeg only getting the Thrashers last season). 4 of those 5 champions won less than 10 years after relocating (Dallas, Colorado, Calgary, Carolina). It took New Jersey 13 years to win the Cup after relocating from Colorado, but they did win 3 championships.

So if you are a hockey fan in a city that has a chance of acquiring a NHL franchise, what gives you the best chance of winning, an expansion team or an existing team relocating? It's not even close! But hey, at least when you're watching that diminished product struggle to reach mediocrity, you can take solace in the fact that Gary Bettman and the group of billionaires he represents made a few extra dollars. Hopefully that will bring you comfort...

1 comment:

  1. I think there are two arguments to be had: 1. what is the best hockey move and 2. what is the best business move. I think you make a compelling and rational case for the hockey interests and fans. However, I would not discount the ownership group's demands for more immediate revenues.

    Perhaps a final decision will depend on the location. If it is a rich, high density market (aka, Southern Ontario) NHL ownership may push very hard for the expansion strategy in order to maximize profits with the perception that fans won't punish the new team because they are so starved for NHL calibre hockey. If the scenario is to enter a medium-sized market with tepid corporate support (aka Quebec) the NHL would be wise to follow the re-location route in order to secure a soft market with multi-year season ticket and corporate sponsorship contracts.

    I personally don't believe the NHL owners are blindly following immediate profits at all costs but they will look to maximize the health of their profits at any given opportunity.