CXLVI - Future of Coyotes up in air after Tempe rejects arena deal - will remain at Mullet Arena for 2023-24, looking at Fiesta Mall site in Mesa

[CokenoPepsi]

It will be more like the Showtime documentary about the Vancouver Grizzlies.

Are you talking about the Grizzle truth?

 

[MeHateHe]

It was Jack Kent Cooke, who owned the LA Kings back when the earth was green, who said the reason that all those Canadians were living in southern California was because they hate hockey. At least that was his argument for why he couldn't get people in the building. But I'm starting to think that's a problem in the Phoenix market.

Someone earlier said that they think hockey can work in Phoenix. While I'm not arguing that hockey can't work in Phoenix, (and please don't lump me in with the hockey-needs-cold-weather people) I just don't think it's been demonstrated yet, and after 26 years of trying, I am of the opinion they need a time out.

I know the sport has existed in Arizona for a long time. I had friends who played in a pretty decent minor hockey tournament in the mid-80s, for heaven's sake. But I just don't think the market is developed for this product and maybe it's time to reconsider the market.

It seems to me that the introduction of a high value product should feel like water rushing into a newly opened gap in a wall, and I never got that sense in Phoenix. The NHL saw a large market and was keen going there. What followed was a stream of red flags:
- the league hitched itself to a whole host of mediocre operators, meaning that there weren't any high-value business people who thought there was money to be made
- the league had take over the club, spending tens of millions in the process
- the club was unable to maintain a relationship with Glendale (the city carries its share of culpability, obviously)
- unable to find a suitable arena in-market, the club moved into a clearly sub-standard arena with the plan to be there for several years; and finally
- the club was unable to secure a permanent location in Tempe.

If the product were something the community needs (food, basic goods, etc.) you don't need a community to display any real passion for it. Nobody gets fired up over the prospect of Walmart coming to town, surely. But for a luxury like high level sports, you need a passionate fanbase, and you need them in place as soon as the team comes to town, and you need them to stay passionate. I don't think that was fully demonstrated before the Jets moved to Phoenix, and if there was passion about NHL hockey, I have to think that there wouldn't be a four or five (or more) year gap in which there wasn't a suitable arena available for the Coyotes to play in. As much as I disagree with public money being spent on stadiums, the fact that cities are willing to throw public money at stupid stadium projects (looking at you Calgary) says something, and the fact that there seems to be limited groundswells of public consternation over the potential loss of the Coyotes says something as well.

I think the NHL is rightfully worried about walking away from a prominent US market. But it seems to me the smart thing to do would be to retrench, move this club now, allow/help the market actually build a desire for NHL hockey, and reconsider in a decade or more.

 

[aqib]

Are you talking about the Grizzle truth?

Yep. It was awesome

 

[aqib]

Fine.... you stick with that little revision of history and I'll stick to the facts.

Balsillie's offer was $212.5 million. Reinsdorf's was like $148 million. That's not revision. Those are just numbers.

 

[OG6ix]

Balsillie's offer was $212.5 million. Reinsdorf's was like $148 million. That's not revision. Those are just numbers.

If he ended up getting the team... YIKES.. considering blackberry/RIM is pretty much dead.

RIM co-CEO Jim Balsillie created a bit of a ruckus on the Web at the Web 2.0 conference in San Francisco last Tuesday, when he downplayed the importance of apps in the mobile user experience. "You don't have [to] make the Web an app," he said, and "I don't need a YouTube app to go to YouTube". There actually is a YouTube app for BlackBerry, but frankly, there is not a lot more to be found at BlackBerry App World. RIM does have over 10,000 apps available, but many are priced at a level that most would consider an "investment" rather than a "novelty".

That didn't age well Jimmy!

 

[Tom ServoMST3K]

If he ended up getting the team... YIKES.. considering blackberry/RIM is pretty much dead.

I'd be fascinated to peak into the world where he bought the team, and then the collapse happened.

 

[Boris Zubov]

That's non-sense. Literally EVERYONE building new arena/stadiums are trying to do this, simply because it's more revenue. The development rights to the area surrounding the stadium/arena are coveted, because tens of thousands of people are trafficking the area and it's a much higher ROI than an arena.

The two parties negotiating/dividing costs for the arena/stadium are both trying to spend as little as possible, and keep as much revenue as possible.

If an NHL owner builds a $900m area himself, and makes $30m in profit running a hockey team... he's broken even after 30 years, at which point he needs a new arena. This is why teams don't just build their own.

If a city gives a $900m arena to an owner for free, they're out $900m.

Making it a "mixed used" development project brings in outside revenue streams besides the team and city.

The NHL owner and city split the cost of the $900m arena and the owner pays off his part of the arena from being the landlord of the entertainment district, the city pays off their part of the arena by collecting the taxes from the entertainment district. The hockey team has the revenues to be successful because they're not paying off the arena the whole time, and the city is creating revenue out of what was nothing.

The business are fronting the cost, which they can afford to do because the arena is handing them tens of thousands in customer traffic. It's win-win-win.

By "other teams", I assume you mean Edmonton & Calgary? I don't know enough about their situations to comment. I'm not seeing how your point relates to the Coyotes & what their entire history has shown. Even a brand new arena where they control all the revenue still isn't enough to make it work without it the entertainment district attached. Full stop. That was the only point I was making. Forget about being profitable, they have proven they lose between $10 & 30M annually. So the only other way forward without relocation is selling them to Ishibia & moving them back in with the Suns.

 

[tucker3434]

If he ended up getting the team... YIKES.. considering blackberry/RIM is pretty much dead.


That didn't age well Jimmy!

I had a blackberry in their dying days before the iPhone came to Verizon. It only took about 5 apps to fill it up and if you wanted to download another, you’d have to delete one. This was at a time when the iPhone had basically no restriction at all.

Yes, too bad we didn’t get to see more of that brilliant thinking in the NHL.

 

[BMN]

That didn't age well Jimmy!

Actually, the thing is...he was on to something but he was missing the forest for the trees, and using YouTube as the e.g. was literally the worst e.g. he could have picked.

I work in higher ed & there's a big move away from apps because students don't like overloading their phones.....but there are certain things for which they absolutely must have an app (basically anything that streams). YouTube is the biggest exception to the rule. Jim wasn't terribly forward looking on that front.

Re: whether or not Moyes was "conned" by Balsillie & co. or simply wanted to accept the highest offer he got & damn the torpedoes.....granted, I remember far less about this than anyone else but wasn't it kind of both? I mean, yeah, Moyes wanted to take money from the highest bidder. But Balsillie'd already been through the Pitt/Nsh scenarios at that point and thus had to know the NHL wasn't quietly going to throw its hands up in the air & say "oh well.....guess the bankruptcy process has spoken and we have to let Jim in...."

Whether or not Moyes was conned depends on the level of naiveté you think he had + the level of awareness he had about the Pitt/Nsh proceedings.

 

[KevFu]

By "other teams", I assume you mean Edmonton & Calgary? I don't know enough about their situations to comment. I'm not seeing how your point relates to the Coyotes & what their entire history has shown. Even a brand new arena where they control all the revenue still isn't enough to make it work without it the entertainment district attached. Full stop. That was the only point I was making. Forget about being profitable, they have proven they lose between $10 & 30M annually. So the only other way forward without relocation is selling them to Ishibia & moving them back in with the Suns.

My post had nothing to do with the Coyotes. You're combining two things that exist in the world of sports business into one faulty premise.

Owners and cities going to a "Mixed Use" Entertainment District around the arena just makes arena deals better for everyone and more likely to succeed. It's the next logical step from what we saw in the 1990s...

Remember when EVERYONE was talking about building sports venues Downtown to spark urban renewal?

The idea being that the stadium would bring tens of thousands of people, so businesses would want to operate there to cater to that traffic: bars and nightlife, restaurants, shops, etc, which would restore/renew that area of downtown into a thriving area.

The results were hit or miss is because the city was just HOPING it happened: That OTHER entrepreneurs would see the opportunity for dollar signs, invest and profit.

If you're the city, you WANT that to happen so including that in the team stadium deal to guarantees that it does happen is a huge win. And the team owners saw where it did happen successfully, and thought "It's OUR customer traffic. WE brought this revenue here... why is that money being made by SOMEONE ELSE?"


So My objection to your post was that owners are gunning for the development rights because it's smart business, NOT because they "need it or the team would fail."

It's merely extending the principles of revenue generation INSIDE the stadium to the property SURROUNDING the stadium.

The Atlanta Braves, Detroit Red Wings immediately spring to mind as two teams who did this who certainly weren't running the risk of going out of business without it.

 

[KevFu]

And of course, it really all started with AEG's Staples Center and LA Live.

AEG did it because there was huge money to be made doing it, not because the Lakers, Clippers or Kings needed it to survive.

 

[Boris Zubov]

My post had nothing to do with the Coyotes. You're combining two things that exist in the world of sports business into one faulty premise.

Owners and cities going to a "Mixed Use" Entertainment District around the arena just makes arena deals better for everyone and more likely to succeed. It's the next logical step from what we saw in the 1990s...

Remember when EVERYONE was talking about building sports venues Downtown to spark urban renewal?

The idea being that the stadium would bring tens of thousands of people, so businesses would want to operate there to cater to that traffic: bars and nightlife, restaurants, shops, etc, which would restore/renew that area of downtown into a thriving area.

The results were hit or miss is because the city was just HOPING it happened: That OTHER entrepreneurs would see the opportunity for dollar signs, invest and profit.

If you're the city, you WANT that to happen so including that in the team stadium deal to guarantees that it does happen is a huge win. And the team owners saw where it did happen successfully, and thought "It's OUR customer traffic. WE brought this revenue here... why is that money being made by SOMEONE ELSE?"


So My objection to your post was that owners are gunning for the development rights because it's smart business, NOT because they "need it or the team would fail."

It's merely extending the principles of revenue generation INSIDE the stadium to the property SURROUNDING the stadium.

The Atlanta Braves, Detroit Red Wings immediately spring to mind as two teams who did this who certainly weren't running the risk of going out of business without it.

What you're saying makes total sense, however, the Braves & the Wings are terrible comparisons. Those are two extremely well run teams that have storied histories, winning pedigrees and large, healthy fanbases. Detroit needed a new building, where the Braves did not.

We don't need to go back & forth on this....My opinion is the Yotes can't make it on their own. They either need a generous subsidy or for the Suns owner to buy them & so they can shack up downtown if a new district isn't built with an arena as the centerpiece. Of course it's smart business for Meruelo, I never disputed that. He's anything but stupid, & he made it clear he wanted the TED as his legacy. My point had nothing to do with his motives, just the reality of the team's viability alone in the market. Perhaps you read more into it than was intended.

 

[Boris Zubov]

And of course, it really all started with AEG's Staples Center and LA Live.

AEG did it because there was huge money to be made doing it, not because the Lakers, Clippers or Kings needed it to survive.

Again I fail to see what this has to do with my statement about the COYOTES needing the TED to survive. Because that's who I was specifically referring to. Somehow you took that I was implying that any sports & entertainment district is a bad idea in every market for every sport.

Personally I thought the TED would be fabulous for the team & the city of Tempe. The city loses a landfill & replaces it with a new centerpiece for entertainment & housing. Plus it's mostly privately financed. What's not to like? Still doesn't change my opinion of the NHL team & their ability to make it on their own. Fair enough?

 

[Yukon Joe]

I'd be fascinated to peak into the world where he bought the team, and then the collapse happened.

I don't think it would be much different from Eugene Melnyk to be honest. - his other investments dried up so he was only left with the hockey team - but the hockey team then exploded in value.

 

[Apex Predator]

I'd be fascinated to peak into the world where he bought the team, and then the collapse happened.

In this world does he successfully move the team to Hamilton or are they still in Arizona?

 

[Roadrage]

Someone from here was going to write a book, but I think got scared off after it reached War and Peace in size.

War and Peace would be a prologue compared to what the Coyotes book will be when completed.

 

[TheLegend]

Balsillie's offer was $212.5 million. Reinsdorf's was like $148 million. That's not revision. Those are just numbers.

AFTER he got the BK rolling.

Moyes had walked away from the franchise. Told the league he was done and wanted no part of it anymore and to find another owner.

By that time the league had already been paying his bills for roughly three months. Moyes had signed control of the operations over to the league.

Balsillie wasn’t even in the picture then.

Bettman arranges to have Reinsdorf buy the team at $138 million and had the money lined up with Bettman on a plane out to Arizona with the purchase documents in hand.

But Rodier got word of what was happening and got hold of Moyes letting him know he might make more out of this if he put the team in bankruptcy.

So like I said… you can stick to your revision and I’ll stick to the facts.

 

[JimAnchower]

If he ended up getting the team... YIKES.. considering blackberry/RIM is pretty much dead.


That didn't age well Jimmy!

To be fair, Steve Ballmer said similar things when the iPhone came out.

 

[Headshot77]

Clearly it's not a 30 for 30, it's a mini-series. Honestly if you want to trace it back to Winnipeg and the WHA-to-NHL transfer chicanery, you'd have a full fledged television show that would go for several seasons.

Days of Our Coyotes

 

[Lady Stanley]

If he ended up getting the team... YIKES.. considering blackberry/RIM is pretty much dead.


That didn't age well Jimmy!

The app thing still doesn't make any sense. it's a trend-gimmick and the primary reason companies push it is so they can collect your private data, without you realizing it.

The whole purpose of an app is to dumb down the user interface. Not to mention how many apps can't use add blockers etc.

I don't think it would be much different from Eugene Melnyk to be honest. - his other investments dried up so he was only left with the hockey team - but the hockey team then exploded in value.

My understanding is a much better arena location and a much much higher of fandom growth.

Contrary to popular belief when the Canadian dollar fell southern ontario boomed.

Hamilton is still growing and will properly continue to do so for the coming decades.

 

[waitin425]

I want the Nordiques back but would also be okay with Houston, SLC or even Hartford for old times sake. The problem with those US cities though, is the same problem faced by Arizona. How do you attract and retain a market.

QC would be an easier market to predict. Although a smaller market, it would be a die hard market.

 

[Tawnos]

Is anyone else confused by @Lady Stanley vs @LadyStanley?

 

[MNNumbers]

Is anyone else confused by @Lady Stanley vs @LadyStanley?

Yep. No space is the queen of the board. Space is the new imposter.

 

[Saskatoon]

I'd be fascinated to peak into the world where he bought the team, and then the collapse happened.

I think a team in Hamilton would have been highly profitable. Maybe not TML level but still pretty decent.

I think if Balsillie would have sold RIM stock and completed the purchase he would probably be better off today

The internet claims his net worth is $800 million today (which is nothing to snuff at)

But in 2011 it was $1.8 billion according to Forbes

 

[ponder719]

I want the Nordiques back but would also be okay with Houston, SLC or even Hartford for old times sake. The problem with those US cities though, is the same problem faced by Arizona. How do you attract and retain a market.

QC would be an easier market to predict. Although a smaller market, it would be a die hard market.

QC's only an easier market to predict if you can predict the future CAD-USD exchange rate. That, and the relatively small corporate base in Quebec, killed the team once, and can do so again.

I want the Nordiques back, too, but let's not pretend they're a surefire, untouchable success. If they were, we wouldn't be asking for them back, we'd just have had them all along.