Lockouts Aren't So Bad. Just Ask The NHL

Hockey Blackhawks Stanley Cup

Photo: AP Images

With the NBA and NFL collective bargaining agreements set to expire in 2011, you’re going to hear the word lockout thrown around quite a bit. It’s unfortunate because no one likes lockouts. Fans don’t have any games to watch, players don’t have any salaries to earn, and owners don’t have any pockets to poach with exorbitant ticket prices. It’s also a cold, hard reminder that at their core, professional sports are nothing more than a business. Some fans say its reason enough to tune out a sport for good.Perhaps everyone can learn a little from the NHL whose season opens tomorrow night.

It wasn’t much of a shock when the NHL was left paralysed by their 2004-2005 lockout. Its TV contract with ESPN was up and after they came back the network refused to offer anything more than relative peanuts–$30 million per-season–for the right to broadcast the games. Instead, the games were picked up by upstart Versus and ratings hit rock bottom. And no, it wasn’t because everyone was too busy at the games to watch them at home. 

But there was a bright side. The year off gave the NHL a reboot of sorts. On the ice, the league altered the rules to speed up the pace and open up goal-scoring, and off of it they changed salary structures to give teams a better shot at profitability. Add the fan-friendly shootout format to the mix, and, as a league, the NHL was greatly improved.

All those changes are starting paying off. Washington Capitals’ owner Ted Leonsis told Sports Business Journal that the NHL reminds him of a “growth company.”

And why not? According to Sports Business Journal:

  • The league is expecting a bidding war for its television contract as its deal with Versus ends after the upcoming season. They expect to see revenue soar 50 per cent in that department.
  • It’s out-of-market digital package, GameCenter Live, has increased its subscriber base by 255 per cent since 2008.
  • Traffic to NHL.com has grown 25 per cent in three years.
  • Digital ad sales rose 191% since 2008, and corporate sponsorship revenues have climbed 162 per cent in three years thanks to $330 million in new deals. 
  • The annual outdoor New Year’s Day game has been an overwhelming success.

Granted, the NHL is just now still catching up to its pre-lockout popularity. But its recent growth numbers nearly resemble that of a Silicon Valley startup. Without the changes forced on them by the lockout, the league might never have shifted to its current, sustainable revenue-sharing model.

As crazy as it sounds, the lockout probably served the league well in the long term. Is it possible such a catastrophe would do the same for the NFL and the NBA?

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