Record NHL ratings could help broadcasters reclaim lost revenues, experts say

Hockey fans are watching televised NHL games in record numbers following a 113-day lockout, allowing broadcasters to slowly claw back lost revenues, broadcasters and industry experts said. Jeffrey Orridge, executive director of sports properties at CBC/Radio-Canada, said in a telephone interview that CBC saw a record number of viewers for the three games it aired on the NHL’s much-delayed season opener of its Hockey Night in Canada program on Jan. 19. He said Saturday’s 7 p.m. game between the Toronto Maple Leafs and Montreal Canadiens drew “well over” three million viewers, while an afternoon game between the Ottawa Senators and the Winnipeg Jets drew nearly 1.5 million viewers, as did a late evening game between the Anaheim Ducks and the Vancouver Canucks. “These ratings are certainly well above anything we’ve done for a season opener in the past,” Orridge said, adding that viewership for all three games was up “significantly” from last year’s opening day games. CBC spokesman Chris Ball told The Wire Report in a December 2011 email that Hockey Night in Canada averaged about 2.1 million viewers for its Saturday evening games over the first two months of the 2011-2012 season. Afternoon games in that period, he wrote, averaged about 1.2 million viewers. Last May, Orridge told The Wire Report that Vancouver Canucks’ games in the first round of last year’s Stanley Cup playoffs averaged about 2.5 million viewers per broadcast, while those involving the Ottawa Senators averaged about two million viewers. Sportsnet, a sports specialty station owned by Rogers Communications Inc.’s, said in a release Tuesday that it also saw “double to triple digit audience growth across all of its broadcasts” over the first three days of the NHL season. It said 2.7 million people watched some part of its Sunday night broadcast of a game featuring the Vancouver Canucks and the Edmonton Oilers, and added that its Monday night broadcast of the Toronto Maple Leafs’ home opener drew an average audience of 1.1 million viewers on Sportsnet Ontario—a Sportsnet regional broadcast record. “There’s this tremendous appetite regardless of what had been speculated before about fans coming back to the game,” Orridge said, noting speculation in some hockey circles that viewership and game attendance would fall after the NHL’s protracted labour dispute. Originally scheduled to begin in October, the 2012-2013 NHL season was put on hold when team owners locked out the players’ union in September as the two sides negotiated a new collective bargaining agreement. At the time, Suzanne Morris, vice-president and chief financial officer at CBC, said any delay to the start of the NHL season would “negatively impact” the Crown corporation’s advertising revenues. Orridge said the lockout caused CBC to “recalibrate” its audience and revenue projections. He added that the public broadcaster benefited from a loyal advertising base that continues to be “extraordinarily” supportive of the Hockey Night in Canada program, in what was supposed to be a milestone year. “I think it’s fair to say that are as excited about Hockey Night in Canada’s sixtieth season as we are,” he said. “Based on the results of this Saturday’s programming, the triple-header, it’s confidence that was well-founded in a relationship that had every reason to stay strong.” Graydon Ebert, a corporate and commercial law expert at Barriston Law LLP and a blogger who writes about sports law and revenues, said in September that the lockout would also cost Rogers and BCE Inc. up to $50 million US per quarter due to lost broadcasting revenues on their Sportsnet and TSN specialty channels, as well as other lost revenues they were expected to glean from their joint-acquisition of Maple Leaf Sports and Entertainment Ltd. (MLSE) last year. MLSE owns the Toronto Maple Leafs, the Toronto Raptors, Major League Soccer’s Toronto FC and a trio of sports specialty channels, including the hockey-themed Leafs TV. Gord Hendren, president of Charlton Strategic Research Inc., said Canadian advertisers often pay a premium to have their ads aired during NHL games during in seasons under normal circumstances. He added that broadcasters such as TSN, Sportsnet, and CBC were forced to offer discounted advertising rates for less popular programs that aired in place of NHL games during the lockout. “ were down during the lockout,” he said. “Obviously in a huge way.” Hendren said broadcasters are not yet able to charge the same rate for ad time during NHL games as they did last season, but said those rates could go up if the record-breaking ratings continue. Those rates could even climb higher than last year’s, due to the limited number of games. “It’s a shortened season that’s the uniqueness of it, now every game counts,” he said. Navaid Mansuri, vice-president of finance and sports programming at Sportsnet, said in a telephone interview that the broadcaster is “ecstatic” that NHL hockey is back on the air. “It’s a big void to fill when it comes to viewers and audiences, and in this country, outside of NHL hockey, there’s really nothing that can fill that void completely,” he said. Brian Schecter, a media consultant and president of consulting firm Puddle Duck Productions in Vancouver, said Hockey Night in Canada’s advertising revenues will return to normal levels by the time NHL playoffs start in April. “There’s a bit of a short term hit but in the long term, I think they’ll be fine,” he said of CBC revenues. CBC may have a limited time to make up for lost advertising revenues, as its contract with the NHL for the broadcasting rights to English-language, Saturday night games is set to expire in 2014. As live sports content rights continue to rise in value, the public broadcaster could face steep competition for the NHL rights from competitors such as Bell and Rogers, who are expected to try to leverage those rights to support their broadcast distribution and mobile phone businesses. Watchdog group the Friends of Canadian Broadcasting said in October that CBC would stand to lose $200 million annually if it does not retain those rights after 2014. Orridge said the lockout-shortened NHL season—in which each team will play 48 games instead of their customary 82—will not impact the length of the CBC’s deal with the NHL. He added that the broadcaster will work to extend that agreement beyond 2014. “Although this is an abbreviated season, it does count as a season in our contract with the league,” he said. He added: “We look forward to another 60 years of the relationship with the NHL.” —With reporting by Danika Grenier at dgrenier@thewirereport.ca and editing by Nicholas Kyonka at nkyonka@thewirereport.ca

Record NHL ratings could help broadcasters reclaim lost revenues, experts say

News | January 23, 2013

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