Wednesday, May 6, 2009

Debate of the Day: Phoenix Coyotes

I figure since we're all very opinionated people, that we can try to start up some legitimate debates here, other than those of the "Does Crosby want some cheese with that wine?" or "Ovechkin makes Ellen Degeneres look do-able" variety.

Now we don't have all the facts in this situation...yet. But here's what we do know. The Phoenix Coyotes have filed for Chapter 11 bankruptcy, filed under "reorganization to implement a court-approved sale of the team under the federal bankruptcy code." In this bankruptcy filing, there is also a proposed sale of the team to PSE Sports & Entertainment for about 212.5 million dollars. Yes, PSE is headed by none other than Jim Basillie, owner of Blackberry's Research In Motion, and failed opportunistic buyer of the Penguins and Predators. In this provision Basillie would then in fact turn around and move the Coyotes to "Southern Ontario," and with his past proceedings, one would have to assume Hamilton (but apparently Brantford), which is within driving distance of a lot of metro areas, as you can see below.

Sure is awful close to Buffalo... sure is awful close to Toronto.

Bob McKenzie of TSN, however, is reporting that current Chicago White Sox owner Jerry Reinsdorf and Gary Bettman are putting together a plan to purchase the Coyotes, all the while keeping the team in Glendale, AZ. Now not much is known about this offer, except we'll be seeing it sooner than later, but one can assume, not unlike the Predator's situtation, that it will be considerably less than what PSE is offering.

However, since David Moss (current Coyotes CEO) filed for Chapter 11, then in Federal Court they must sell to the highest bidder. BUT! Since the NHL has loaned monies to the Coyotes, the NHL believes Moss no longer was within his rights to declare bankruptcy and that in fact, the NHL has removed Moss as an official of the club and will represent the franchise in Bankruptcy Court. Ok.

Get it? Bettman, guns, Coyotes? Whatever.

So those are the facts and back to the debate at hand. Right now let's talk about the two high level options we have.
  1. Keep the Coyotes in Arizona: I'm not a lawyer, so I don't know all the ways that the NHL could succeed on keeping Jim "Mark Cuban" Basillie out of the old boy's club, but that is Bettman's current mission. The NHL loaned monies to this club, played at 85% attendance, and amazingly enough, the Coyotes have lost upwards of $45 million.

  2. Let Basillie Buy the Coyotes, move to Ontario: Jim Basillie already has the data for season ticket sales in Hamilton, he already tried that when he made his move for the Predators. There is obviously demand in that area. The NHL take's a sweet chunk of change home with them and can forget about the mitigated disaster of Bettman's Grand Experiment.
Now let's talk about this...If you're Gary Bettman, are you trying to keep the Coyotes in Phoenix? Are you willing to move the team to Ontario? What is in the best interest of the team? What is in the best interest of the League? Will Buffalo and Toronto lobby against PSE?

Let's chat.

14 comments:

ScottyWazz said...

You know, I don't know if the Sabres have the right to complain about the whole territoriality thing since it is quite a ways, but the Leafs will fight tooth-and-nail to the end of it all.

As far as the NHL, if they want to make this a money making venture, they'd let Balsillie get the deal and let him move it to a viable market that will make money. The BoG would agree, though begrudgingly, to sell to Balsillie because he could make something work in a hot market.

The Coyotes can't make it in Phoenix-- not with the lease they have and the lack of solid fanbase surrounding it.

Vance said...

Well, the Sabres are in a unique position there. There's a lot of people who can't get, can't afford, don't want to get tickets for the Leafs, who have often easily attained tickets to Sabres games. Those types of fans will all but disappear from HSBC if a team arrives in Brantford.

As for the topic on hand, I think for the league's best interest, the "Jimbecile" should get the team, move them to the viable market that is Canada, and help boost the perception...and bank rolls of the league.

As for Bettman's best interest, to see his grand experiment of non hockey market expansion fail may be too much for his ego, and he'll fight tooth and nail to keep them in Glendale.

As for Jimbecile, he just wants a team dammit. And he, reportedly, will even be willing to give [Gretzky] Gretzky up to a 15% stake in the team to get his backing. Now that's how you get to the top of the business world.

As for Brantford, do they have Coyotes or are they going to have to change their mascot?

Inspector Parts said...

It makes so much sense to let JB buy and move the team to Canada. Except for Count Bettman's idea that he's going to be able to convince an American television network to lavish millions of dollars on the NHL for television rights. If that is ever going to happen he needs as many U.S. markets as possible in the league. It's kind of strange to watch the way he's propped up these markets that are not traditional and have underperformed. Specifically Nashville and Phoenix. Geez, Denver and Atlanta lost teams in the past why would the league have returned a second time? Did the league go to the same lengths to try and find a way to allow the Nordiques, Jets and Whalers stay in their original homes? I'm asking because I don't know. But my recollection is that they didn't. It just doesn't seem right that they would have let the Jets bail on Winnipeg so easily and yet the league seems bound and determined to keep the Yotes in a market that doesn't appear to be viable.
The only real solid thing that I know about this situation is that I went to a Coyotes game on a Saturday in January and there were 8,000 people there tops. We snuck right down to center ice approx. 5 rows up and had no hassles. I really doubt that this would be the case at any NHL game on a Saturday in January in Canada.

PDX Pens Fan said...

Still waiting for that OV dive video!

Vance said...

I haven't found it yet! Youtube is in fact, letting me down.

Denson said...

I can't find it either. Pissing me off

Tom said...

Devil's advocate:

If southern Ontario is so hockey-mad that they are already watching games and buying merchandise, what's the point of moving a franchise there? Aside from ticket sales it won't generate any new income, and there's a good chance it will cannibalize both the Leafs and Sabres.

On the other hand, if the Coyotes can get to the point of just breaking even, they will represent a market that will otherwise generate almost zero income for the league.

Something to think about -- are we facing a market problem, or a business model problem? Methinks the latter.

Vance said...

The Inspector and Tom have good points. The idea behind Bettman's grand experiment was to increase American market influence, ergo getting greater television exposure, which would lead to a revenue explosion.

BUT

That didn't happen. NBC plays games between the Rangers, Flyers, Wings, and Penguins on Sundays, while Versus or rather OLN, get's a couple games a week...if we're lucky.

So where does moving the Yotes fit into this equation? Well obviously moving into established markets would be an immediate boom to the League's bankrolls, but would roll back the greater market exposure Bettman has been going for all along.

Does Bettman pass the onus on to Las Vegas, Kansas City, or Seattle to aid market exposure? Probably.

Denson said...

I tend to think Bettman is going to lose out on this one and we're going to see Phoenix move.

I just don't see how a new team in that area is going to generate any sort of a fanbase. Most of the people in that area are already loyal to the Leafs or Sabres. Aside from initial curiosity and the excitement that comes from having a new team in town, who's going to go to these games? People that can't get tickets to Leafs and Sabres? Yeah maybe, but is that going to generate any additional revenue than what Phoenix already collects?

Phoenix does seem, however, to be headed in the right direction at least. We know the Maple Leafs are in rebuilding mode...and Buffalo might be facing some major overhauling this offseason as well. So who knows, maybe Phoenix would end up being the best team and hot ticket.

ScottyWazz said...

The thing I'm trying to get my head around is why a hockey-centric area like Southern Ontario wouldn't want another NHL team in there. Could it dip into the Sabres and Leafs cash-flow?? Mayhaps, but if there's people not getting tickets to either team then a third option wouldn't be the worst idea to get more people in to see the teams they want to see.

The issue with Phoenix is they have been mismanaged from the get-go and I think are in too deep to dig themselves out to make them a viable commodity in the Phoenix area. The BoG, who makes the end-all, be all decision in this, may have to swallow their pride and make the realization that Phoenix isn't going to make the bank that a place like Hamilton would.

But the great point is the issues with Quebec, Winnipeg, and Hartford, with a side of North Stars and the lack of help that the NHL gave out to those franchises at the time.

Matthew said...

The bottom line is that the Coyotes are a Mickey Mouse organization.

Toad268 said...

Ok, here are my thoughts, if they let Balsille take the team to Southern Ontario, yes it is a great market, yes, I think he would make a great owner (despite the lies), but all in all, you would eventually be having to move Buffalo or Toronto then. So, the overall thought process to keep the team in failing Phoenix is a bad idea and the same with moving it to Canada, although longer term. How about that Kansas City idea? They can stay in the Western Conference, have a new arena and you would only be relocating one team. I don't see that happening, but I like that idea the best.

Justin
http://www.everythingpittsburgh.net

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