Gary Bettman cannot see the forest for the empty seats...

The Phoenix Coyotes had 1,000 fans at a game. That is all.

"About 1,000 fans were at the 17,800-seat Jobing.com Arena for the Coyotes preseason opener."

Related:
Coyotes fans blame Phoenix media for lack of support (Phoenix Business Journal, Sept. 16)

The NHL moves the goalposts, and maybe a whole team it was sworn to defend

Honestly, this was just a joke!

"If you want a short and snappy answer about where the Phoenix Coyotes will play, just say Kansas City." — Aug. 6

Then it gets out that the NHL's Hail Mary play to buy the Phoenix Coyotes would only keep the team there for one season before they would try to move it. They have to protect those expansion fees, don't you know (and Eric Duhatschek's put-the-Coyotes-in-Toronto theory actually makes a lick of sense, keeping in mind this is coming from a newspaper which is part of the same corporate family as TSN):

"In an about-face, the league's bid to purchase the Coyotes out of bankruptcy court specifically mentions it is open to relocating the team.

" ... Since the NHL states in its bid that it 'does not anticipate there would be a net profit upon a resale of the team to a Glendale buyer,' its own interests, and those of the creditors, would likely be best served by relocating the team to a market where its value could be maximized beyond $140-million.

The league’s apparent openness to relocating the Coyotes flies in the face of its commitment to Glendale, dating back to when the team’s troubles surfaced last season and throughout the league’s four-month fight with Canadian billionaire Jim Balsillie ..." — globesports.com

"... the NHL’s plan (to buy the Phoenix Coyotes) is nothing but a stay of execution. In the short term, it will give Glendale one last chance to lure a local investor or bring (Jerry) Reinsdorf back into play. If it doesn’t work, the Coyotes will be off for greener pastures." Arizona Republic

In the words of a Kurt Vonnegut character, "I had to laugh like hell." Make It Eight, Eh dug out a great quote from NHL deputy commish Bill Daly from just last month.

"Daly stressed the new terms would not allow the Coyotes to break the lease in a year or two and move elsewhere.

"The NHL must fight for the bankrupt Coyotes to stay in Glendale long-term, he said, to send a message to other cities that have spent money attracting or retaining hockey teams.

" 'If we want communities to continue investing in our franchises, we need to work arm in arm to protect their investments,' Daly said."

Whoopsy-doodle. It turned out those "communities" are not actual communities where people live and pay taxes, but groups of really, really rich guys. There is, for instance, L.A. Kings owner Philip Anschutz, whose company owns an arena in Kansas City which needs a tenant from a big ball-and-stick league. (This just a personal opinion.)

Meantime, it's behind the times to portray this as Hamilton vs. Phoenix (Puck Daddy). Never was. Gary Bettman and Bill Daly know who they work for, and it's whoever needs a hockey team as a front for Hoovering back scads and scads of corporate welfare.

Plus, for the Bob Loblaw Law Blog devotees, there is the whole issue of the NHL violating an important legal principle. Sub judice restrictions don't apply in the U.S., let alone in civil court, but it still doesn't mean it's not jerkass arrogance:

"Confident that the fans and the sports media would back them up ... the NHL circled their wagons and put on a Balsillie Is Rotten campaign.

"The pinnacle of NHL hypocrisy came in remarks recently made by Ottawa Senators owner Eugene Melnyk. Melnyk is often deservedly ridiculed by the outside-of-Ottawa hockey press for his allegiance to a lame-duck general manager (Bryan Murray). Ottawa's recent run of personnel crises has been reflected in league and playoff results.

"Melnyk, as the sports press seems so quick to forget, was the subject of an Ontario securities commission inquiry which alleged misleading and untrue statements made in the financial statements of Melnyk’s company, Biovail Corporation. Melnyk, before the OSC chastised him, blamed his staff! He settled the charges in 2007, was fined $1 million and ordered to cease being director of his company, Biovail, for one year. The OSC record is no credit to Melnyk.

"What pricks the conscious of caring lawyers is the NHL pre-emptive strike against Balsillie even while the bankruptcy proceedings are sub judice in Phoenix. By sending out their general counsel Bill Day to media outlets to spin doctor the rejection of Balsillie by the NHL board based on, apparently, Balsillie’s lack of integrity and character, not only offends the rule of sub judice, but seems to be the epitome of hypocrisy.

"The media is lapping it up too. The venerable Sports Illustrated published an article which actually quoted Melnyk’s self-serving drivel.

Long story short, this is ugly. At least we now know where the NHL was coming from. It never really made sense why they were so gung-ho about Phoenix, other than Bettman's ego. As Make It Eight, Eh says:

"The NHL and the Reinsdorf group were looking to relocate this team either now, or within five years to another centre that fits the plan of the NHL.

" ... The NHL has shunned the fans of Canada, and is quickly shunning the fans of Phoenix.

"Jim Balsillie has a brighter future in the NHL than Gary Bettman, and let’s see who is around in 10 years.

"Jim Balsillie, despite being voted against, has been approached by other struggling franchises, and is the true white knight to help the destitute owners."

Who knows what will happen. There's a fatigue at this point. It is perfectly rational and understandable if you have shunned sports radio and probably will until it gets resolved, since the Howard Bergers of the world are way in over their heads with this story. It has been fun, though.

Thursdays with RIM Jim: Making head and tail of something that should be settled with a coin flip

(If you want a short and snappy answer about where the Phoenix Coyotes will play, just say Kansas City.)

A league with a dated perspective deserves a dated analogy, so the latest turn in the Phoenix Coyotes saga makes the NHL look like the scene in Old School where Will Ferrell screams, "We can't have anyone freakin' out out there! We gotta keep our composure!"

The NHL, as always, is expressing confidence it is going to prevail. There is a half a mind to snark off, like one of Jim Rome's listeners, "Dear Gary, pro sports leagues always prevail in court, sincerely, Al Davis, Oakland-Los Angeles-Oakland Raiders."

Meantime, the realization the Phoenix Coyotes drama has — with a tip of the cap to lame-duck Ottawa GOSINOG* Larry O'Brien — is more than a big swinging dick contest has really hit critical mass since this time last week. Judge Redfield T. Baum's ruling on Wednesday really takes the animus between Jim Balsillie, Gary Bettman and 26 owners of solvent-for-now teams out of play (see From The Rink). That should be burned into memory. Everyone has seen the Phoenix New Times article which laid out the depth of the sweetheart deal Jerry Reinsdorf stood to score from the city of Glendale, Arizona.

The New Times' Sarah Fenske notes that a "good city manager ... has to do whatever he can to keep the (team)" — stop cry-laughing, Ottawa readers — "But it's one thing to fight to save a team. It's another thing entirely to fix the playing field for connected insiders." Here is the trenchant part:

"Michael Reinsdorf, who is Jerry's son, had been hired to help manage the Arizona Cardinals' stadium in 2004. (His firm, IFG, got the contract as a joint venture with Global Spectrum, a Philadelphia-based firm that just happens to employ John Kaites as a lobbyist.)

"In the fall of 2008, Glendale hired Michael Reinsdorf's IFG to assess stadium operations at the Coyotes' home, Jobing.com Arena. It was IFG — which, again, is Michael Reinsdorf's firm — that suggested Glendale hire Beacon, as city officials confirmed to me.

"The Reinsdorfs have a long history of working with Beacon. In fact, court records show Beacon was sued in Los Angeles by a client who claimed Beacon had leaked a confidential report to, yes, Michael Reinsdorf.

"So when the Coyotes ran into trouble, Ed Beasley brought in Michael Reinsdorf's firm. At the suggestion of Michael's firm, he brought in a second company, one that had a history of dealing with Michael Reinsdorf. Then he stood by as that firm secretly met with Kaites and Jerry Reinsdorf.

"And now we're supposed to look at the firm's analysis as neutral, looking out for Glendale's best interests?

"I simply don't buy it.

"In May, the Coyotes filed for bankruptcy. Its current owners want to sell to an investor who'd move the team to Canada; it's their only hope to recoup even part of their investment, they say. Meanwhile, for reasons that are still unclear — to me, at least — Kaites and Reinsdorf have become the NHL's pick.

The great Stephen Brunt, who makes grasshoppers of us all, characterizes it by saying the "subsidies (Jerry) Reinsdorf is demanding are political dynamite in a place where few are sentimentally attached to the team."

Meantime, as James Mirtle notes, Balsillie's bid still has a legal leg to stand on:

"That the judge hasn't already thrown out Balsillie's bid says to me he won't feel obliged to do so before the auction itself, although we're certainly going to hear plenty of new arguments from the league on that front. And while some of the information presented by the NHL certainly paints Balsillie in such a way that makes it easy to see why they dislike him, the fact his dealings in Pittsburgh and Nashville were aimed solely at moving a team to Hamilton will not likely 'taint' him in the eyes of the court.

"Think of it from the court's perspective: If the biggest issues surrounding Balsillie's conduct relate to his push for a franchise in his backyard, would his winning the Coyotes bidding process not solve those issues?"

Mirtle also linked to an East Valley Tribune column, "Bettman responsible for Coyotes' mess," which made it sound worse than the Montreal Expos situation a few years ago:

"This has become a disaster of Titanic proportions. The Coyotes still don’t know who their owner will be, and they may not have an answer by the Oct. 3 start of the regular season. They don’t have a TV contract. Their season-ticket base is dwindling, and sponsors are scurrying away like cockroaches when the light comes on."

No one can really say for sure how the court will decide Sept. 10, which is just five days before Bettman's overpriced orphans of winter will play their first exhibition game. It's a little funny that no one seems able to definitively answer, "What's going to happen if Balsillie wins in court?"

The great site Make It Eight argues that Bettman has a chance to set "a precedent for accomodation" if the court accepts Balsillie's bid at auction. Go ahead and say that will never happen. To hazard a guess, if Balsillie won, the NHL would insist on holding a vote . Bettman would win in a Mahmoud Ahmadinejad-esque landslide and the league would run the Coyotes and try to scare up an investor who could plunk the Coyotes some place such as as Las Vegas Kansas City, which already has an arena built by the company which owns the Los Angeles Kings. After Wednesday, though, the league's power seems less absolute, but they have wriggled off the hook before.

Related:
Why an empty rink may be better than a local rink (James Mirtle, From The Rink)

(GOSINOG: Acronym for Guilty of Stupidity, If Not Officially Guilty. O'Brien's case perhaps should have never gone to court, but the damage was enough.)

Vernon Wells tries to be transparent about his terrible hitting

Vernon Wells sure has delivered in terms of offering up grist for the few, the proud who are not PED-ed out by steroids-in-baseball talk. Who says he never comes through when the chips are down?

"The American League team’s union representative is among a growing number of players who are calling for the infamous list of 104 names to be made public.

" ... Wells said this is akin to water torture and is sullying the game's image with the steady prodding of adverse publicity every time a new name comes out.

" 'This all went down so long ago,' Wells said. 'It's just, let's move past this. Whether more names come out or they all come out at the same time let’s get past it so we can stop talking about something that happened six years ago.' "
-- globesports.com

Please forget that is a little Freudian that the Globe & Mail's guy used "water torture" as an analogy, considering what else went down in 2003-04 which is a little more shameful. America has always been good with obsessing over a sports scandal rather than face facts like their government destroying the concept of habeas corpus. That is neither here or there.

Wells' comments take on a certain light if you read Jeff Blair's Monday column that suggested MLB needs to "get in front of the news curve and fashion a blanket amnesty for players on the list." The man has between third and sixth all season while on-basing .301 and slugging .400. With slash stats such as those, it's almost like Wells is making a plea to be free of the jokes that Jays fans wish he could improve his production through pharmacology.

Point being, this has the droll side and the serious side. Jays fans, since they can't cry, will probably draw a couple laughs from Wells being the one to say release all the names. The way his season has gone calls to mind the story about Earl Weaver going to the mound to visit a struggling pitcher, "If you know how to cheat, start now." His park-adjusted OPS figures, season by season, since 2003, do set the mind to wondering:

'03: 132
'04: 105
'05: 104
'06: 129
'07: 85
'08: 121
'09: 84

Thing is, no one knows why Wells' numbers have cratered. He is projected to end up with Triple Crown stats of .259, 16 homers and 64 RBI. It might be noteworthy that he had a much higher line drive when he first became an everyday player. He makes a lot more flyball outs now. It's as if he hit home runs when he first came up just because he was so strong sometimes those line drives would carry over the fence.

On the serious side, Blair's suggestion seems pragmatic. Major League Baseball's labour agreement is up after the 2011 season, so it can't afford to have the steroid matzo ball hanging out there.

Meantime, it is too funny by half to see a Boston newspaper going on about how the Red Sox "need to be put on notice" when it comes to getting rid of steroids in baseball, as in, sure, now it's a big deal. Greater minds have no doubt said this and I said it once on Kinger's show, it's silly how much has hue and cry there has been over steroid use in baseball and Michael Vick running a dogfighting ring in the past couple years. Those have become defining events against a backdrop of Guantanamo, the Iraq quagmire and finding out the U.S. housing market ran on the principle "if you could fog up a mirror, and had a pulse, you were eligible for a fairly large mortgage" (stick tap: Make It Eight) and Bernie Madoff robbing people blind.

Sports scandals are benign and their leaders' job is not provide a moral compass, no matter how much its fits some columnist's 12-year-old worldview. It only matters if a sports story is symptomatic of a larger outrage, like the NHL being a water carrier for a plan to fleece taxpayers in Arizona.

That is off-topic. Point being, at least Wells is being honest, and at least baseball can get closure on the Steroid Era before hockey will on the Bettman era.

Related:
Wells wants baseball to come clean (Robert MacLeod, globesports.com)

He's hung out the gone drinkin' sign, sir ...

Note to our users: Sager is travelling to the Ontario University Athletics' sports information directors' meeting, so posting might be light(er than usual) today.

Meantime, read Stephen Brunt's take on Jim Balsillie losing the court fight for the Phoenix Coyotes and wonder whether the NHL can get a Popemobile for Gary Bettman to use when he next visits Canada ... ponder how in the hell a labour union can support Quebecor's bid for the Montreal Canadiens when that company has locked out its employees at Montreal's biggest French-language paper ... cheer for Canada's junior men's basketball team, coached by Greg Francis of Toronto, winning a tournament in France last weekend even though Canadian hoops hostshots Tristan Thompson and Cory Joseph were playing for the U.S. side (which everyone seems cool with) ... last but not least, you heard right, Brett Favre used the term "we" when talking about his potential role in the Minnesota Vikings: "They do have a great running back, a great running game. If I go there, there are no guarantees. We all know that. I went through that last year with New York. I think every player should think that he is a difference-maker. I think you have to believe that. But in that situation, understanding what is expected of you, knowing your team, knowing that as long as we can run the ball and complete passes when needed, we should be pretty good." May God have mercy on us all.

This has nothing to do with any decision handed down just now by Judge Redfield T. Baum

The dream never dies ... just the dreamer.



Now that the Phoenix Coyotes' status is still uncertain, can Dany Heatley buy them for $1, install himself as captain/coach/GM/president/owner and play himself for 60 minutes a game? Someone was asking about that on Ottawa's The Team 1200 today.

A little levity, a little Gary and little coming from MLSE

A little levity is always good with regard to the Phoenix Coyotes situation. Seeing Gary Bettman represented by Nathan Thurm, the chain-smoking lawyer character whom Martin Short played on the mid-'80s Saturday Night Live is almost as funny as the commish himselfclaiming the Coyotes "were never in jeopardy."



Meantime, and it's not as if people are unawares about this, but there is nothing-but-nothing coming out of MLSE about the possibilty of a team moving into Southern Ontario.

One would expect that to be the case, of course, and perhaps people who read the business section faithfully would have heard about the following. However, this section from a Phoenix Business Journal profile of Richard Rodier, Jim Balsillie's legal eagle, really shows how defensive MLSE is about the A-word, antitrust.

"At a 2008 sports business conference in Toronto run by then-Anaheim Ducks General Manager Brian Burke, several people in attendance recount a tense moment when Rodier posed an antitrust question to Maple Leaf Sports & Entertainment President Richard Peddie at the end of a panel session.

" 'Why, if I’m in the city of Toronto, can’t I watch the Ottawa Senators?' Rodier asked.

" 'I’m not going to debate antitrust law with you,' said Peddie, who did not return calls requesting comment for this story.

"Rodier defended the question last week, saying that it was legitimate. 'To ask a question that makes someone who may be operating outside the law uncomfortable is not in my view a bad thing,' he said."

That can be backed 100 per cent. No doubt a few people have wondered about an antitrust suit against the NHL at some point down the line. A court has found that Major League Baseball's infamous antitrust exemption does not apply to the sale of franchises, so speaking as a layperson, it could be a legal tempest.

Also on this topic, this site's own Andrew Bucholtz was on a conference call where former CFL commish Tom Wright talked about Balsillie's application. Here's Part 1 and Part 2.

That's about it from here. It would be remiss not to pass along something from the article on Rodier that seemed funny, since it furthered the stereotype that all Canadians know each other.

"(Rodier) then went on to the University of Toronto Law School, earning a law degree in 1984 and coming to the Canadian bar in 1986.

"Balsillie graduated from the University of Toronto in 1984 with an undergraduate degree, but Rodier said they didn’t know each other at the time."

The U of T only has 60,000 students. There's a good chance a law student and an undergrad would not be acquainted.

(Pretty please keep in mind a much lazier man was earlier to the game with the Bettman-as-Thurm comparison. Granted, this space has also likened Bettman to the Chip Diller character in National Lampoon's Animal House ("Remain calm! All is well!) and the NHL to Cameron Frye in Ferris Bueller's Day Off.)

The money pit in Phoenix

As a follow-up to a recent post on the Phoenix Coyotes, it's only necessary to point out the number-crunching From The Rink did about Glendale:

"... it's all but impossible for Phoenix to turn a profit, even under ideal conditions. The team's expenses are too high and its potential for generating revenues too low barring a long playoff run and a massive price hike." — James Mirtle

The great mc79hockey also looked at the team's expenses and wondered how in hell they think they can make money settling cut-rate tickets to some of the NHL's smallest crowds.

That doesn't necessarily give people in Canada license to bash people in Phoenix who did actually support the Coyotes. The fans weren't responsible for profligate spending and the NHL's broken economic model — or for the birdbrained decision to build a hockey arena in Glendale, Arizona, so far from Phoenix's downtown core. There is also the more macro concern that Arizona "was one of the most severely affected states" for foreclosure filings last month (Phoenix Business Journal, May 13). When people are losing their homes, it's little tough to fork out more money for hockey tickets. Businesses probably have less latitude to gobble up tickets which can lavished on clients. As Mirtle notes, though, the dream scenario for preserving the NHL in Phoenix involves a massive price hike:

"To hit those ticket revenue figures, prices would have to increase significantly from the average $37 current average price, however. My rough math tells me that, even if the team sold an extra 3,000 seats a game at current rates, they'd be $12-million shy of the "potential" ticket revenue figure here, meaning tickets would have to cost roughly $15 to $17 more on average to hit that mark."

Meantime, the one irony of all the Balsillie-boosting, as others have noted, is you'd move a team from one economically devastated area to another, Hamilton.

As a sidenote, it seems like a lot of us up in Canada are throwing stones from a glass arena. It's a bit of a collective conceit that Canada has some monopoly on supporting major league hockey. Kurtenblog noted earlier this week there was one season during the pre-lockout era when the Nashville Predators had a higher average attendance than Calgary, Edmonton and Vancouver. (Granted, hockey was a novelty in Nashville, and who knows what the difference were in average ticket price and comped tickets.) We're not so perfect.

Gary Bettman: Happiness is watching franchise bingo

Forget the Stanley Cup playoffs. With the NHL these days, it's all about atrophy.

There is not enough hours on the day to keep up with all the minutia of the Duel in the Desert over the Phoenix Coyotes, unless you are employed to cover the NHL. However, it bears noting Chris Botta at islanderspointblank.com has spelled out that Johnny Tavares' betrothed, the New York Islanders, have one, maybe two years left on Long Island before they'll have to relocate. Most of you know full well that the Atlanta Thrashers and Tampa Bay Lightning have a licence to hemorrhage money. All one can really do is try to understand why Gary Bettman is fighting like a drowning muskrat against the interest of most fans. It has less to do with creating anarchy where anyone could move any team. It's a house of cards scenario that basically parallels the financial crisis, which is really about unravelling the economic lies that have become accepted fact since the early 1980s.

There have been enough rumblings to suggest that keeping Jim Balsillie (at this point, just hearing the words "ball" or "silly" is enough to bring on fatigue) from moving a team to Southern Ontario is about preserving a market for future expansion. People pooh-poohed the idea when it was brought up the other day, but Tom Benjamin, who has more hockey geek cred (he's been on Hockey Night in Canada!) said as much earlier this week:

"Bettman's priority is clearly not about saving hockey in the desert. It is about keeping any hockey team from relocating to Southern Ontario. This is a about protecting a territory the league can sell. (And that’s the worst thing about a failed Balsillie bid. The league will expand in response to the fallout in Canada.)"
-- Tom Benjamin

Essentially, Bettman is fighting to hang on so the league can repeat what it did in the 1990s. Most of you know the NHL went into a period of expansion, from 21 to 30 teams, not long after the 1990-91 recession. It's now known as the Southern strategy.

The problem is that these markets only work - both in real economies and the NHL itself - if there's an ability to sustain it. The NHL during the 1990s succeeded for a time in convincing enough people in places such as Miami, Florida, that they needed to buy hockey tickets. Like the original Florida Panthers owner, Wayne Huizenga, told Sports Illustrated back in 1993, "We want this arena to be a happening place when the Panthers are playing, a place to see and be seen. We've got to get people here for all the wrong reasons, then turn them into hockey fans so they'll come back for the right reasons."

That worked, for a time. At a certain point, though, either there is a market for something or there isn't. It goes bust if there's an artificial market. Imposing demand on sports fans fits in with the same kind of consumption for its own sake that ran rampant in North America during the back half of the 1990s and early part of this decade. It's the same as convincing people to buy a third car, when they only need two, or a McMansion (according to Chris Turner's book Planet Simpson, the size of the average American home increased 17 per cent during the '90s). It's like extolling the virtues of (to quote a commercial that was in heavy rotation during hockey broadcasts a while back) having "fifty-two inches of glorious HD" when you can watch DVDs of your favourite shows on a four-inch high window on your laptop.

At some point, the NHL has to pay the bills. Their economic model is broken because it was short-sighted. A friend who knows about such things says this is pretty much a microcosm of the way the U.S. economy has gone since 1981.

You have probably read at some point that Gary Bettman has shepherded the NHL from being a $400-million business to a $2.2-billion one, and that's why the owners like him. The big but is this assumes as long every member franchise was healthy on its own. It assumed there was infinite amount of goodwill towards pro hockey in markets, just as there was an assumed infinite amount of cheap credit.

It's the same kind of thinking that as recently as 12 months ago, meant any number of idiots believed they, too, could be CFO for a hedge fund. As long as there were not en masse bankruptcies and no one lost arenas (which are sub-prime homes in our analogy), it was all good.

In a further irony, as Bob McCown noted on Prime Time Sports last night, there's not an idea how Phoenix could be saved. The NHL has about as many fresh ideas for keeping hockey in Phoenix as Arizona Sen. John McCain had for fixing the U.S. economy. All both could muster is, "Well, that won't work," and try to hold on to the carcass.

All it takes for one franchise to crater and the whole thing collapses. There was no fallback, no bailout, no nothing. Like Benjamin said with regard to the court-mediated tussle over the Coyotes, the longer it goes, "the bigger the league's black eye gets." The Islanders, the Coyotes, who's next, eh?

You can still block it out and watch the rest of the playoffs, which should be wrapping up sometime in June. It would be silly to use the league's idiotic business practices to justify non-interest in what happens on the ice. Be grateful for the ability to compartmentalize.

Balsillie season: The NHL's game of Calvinball

Many containers of alcohol should be poured and consumed in James Mirtle's honour for unearthing NHL commissioner Gary Bettman's words on when it's time to move a team, from a February interview with Hockey Night in Canada's Jeff Marek:

"The fact is, the biggest litmus test ultimately was nobody wanted to own a team there (referring to Quebec City and Winnipeg in the mid-1990s). And when the marketplace decides that it doesn’t want to own a team there, it has no future."

It seems like something to keep in mind when the NHL is pitching bull and woo about sports mogul Jerry Reinsdorf's "underfunded bid" (Jeff Blair, globesports.com) to buy the Phoenix Coyotes so Jim Balsillie can't.

You have to love the NHL's endless game of Calvinball when it comes to keeping a team from relocating to Canada. The double standard is so obvious it barely requires pointing out. Anyway, there's only so much an outside observer can add to the mix. It is hilarious the NHL wants Jerry Reinsdorf as an owner, considering that in his capacity with the Chicago White Sox he was a main culprit in scuttling a World Series and that, with the Chicago Bulls, he deep-sixed a dynasty to prove some point that only mattered to him and economics professors. But I digress.

Stephen Brunt did a honker of a chat the other day that covered a lot of bases, including putting Wayne Gretzky in the crosshairs (which Blair also did in the above-linked column):

"If the Coyotes wind up in bankruptcy and (Gretzky) indeed endorses the alternative offer for the Coyotes (from Jerry Reinsdorf or whomever), would love to know what he's been promised in terms of the teams obligations to him. Gretzky has $22.5-million hanging in the balance here, and as an unsecured creditor, would otherwise have to get in line.

Fun, fun. Five days until the big showdown in an Arizona bankruptcy court.

Related:
On when to pull the plug (From The Rink)
NHL helping cash-strapped Coyotes (cbcsports.ca, Feb. 5, 2009)

The nearly nightly Balsillie roundup

Someday, it will seem like this was coming from a mile away.

It is notable how it seems to breaks down along old media/new media lines on the eve of the big bankruptcy court showdown over the Phoenix Coyotes. It seems like the belief in some circles that Jim Balsillie will never own a NHL team reflects a desire to be reassured that othing is going to change in the NHL, everything is status quo, their place in the grand scheme is secure. The great upheaval is not coming (feel free to draw a parallel with any suffering media industry).

Stephen Brunt noted that the last time around (with the Nashville Predators in 2007), "the NHL propaganda machine worked to portray Balsillie as a loose cannon — which a large segment of the hockey press reprinted as gospel." It's noteworthy, in that respect, that Balsillie's people curried favour with bloggers more so than traditional media (and no, we didn't get the memo).

What people need to understand is that this is a collision between, for lack of less general way to say it, new money and old money. Tech companies such as RIM are not like traditional companies. They were formed by guys who did not conform to regular practices. Pro hockey tends to be the ultimately in stuffy, hierarchical corporate conformity, a model that's hopefully going to die out in our lifetime.

Balsillie approaches things from a different perspective. He is 48 years old, but he can be, for some intents and purposes, slotted in with net geners who prize transparency, to a point. (Obviously, that wouldn't have worked with his Coyotes plan.) Conversely, when one of the NHL old boy clubbers like Red Wings president Jim Devellano talks about how the NHL likes to do things on a "quiet basis," he's saying that costumers have no right to transparency, that they'll get whatever the powers-that-be decide is best for them. That is no way to run anything in the 21st century.

That's how you end up with the NHL that wants to fight a guy who is willing and able to increase their equity, all on the basis of some stupid, broken notion of expanding the American market.

It is funny as hell how Gary Bettman could stand there and say someone is trying to break the rules, when, as Brunt pointed out, Balsillie own the Pittsburgh Penguins if the league hadn't moved the net and tried to bind him to owning a franchise which has gone broke several times.

A lot hinges on what the court finds. A bankruptcy judge whom the Arizona Republic noted one possible ruling is that, a "non-debtor party (the league) shouldn't have the right to prevent creditors from realizing on that value." It seems clear as mud.

There are a million and one elements to this (does anyone even care who won the playoff games last night? Both were 3-2 overtime games). The CBC, whose playoff ratings have been hit-and-miss with no Eastern Canada team still alive, would obviously love it. Bell GlobeMedia (is The Globe covering anything else?) would love having the Ontario Coyotes or Golden Horseshoe Hammerheads to enhance the value of TSN2.

Whatever happens, happens. The NHL might find a way to keep Balsillie at bay, but that doesn't make it right.

Anyway, here's a selection of stuff from around the web:

Allan Maki, globesports.com: "The commissioner's job is to make the game popular and profitable. Right now, he can barely keep it stable and that can only mean the pressure from the inside may soon be as great as the pressure from the outside.

"You think NHL owners are eager for protracted litigation against moneybags Balsillie? You think the owners would prefer to lose bundles of cash funding a team in a questionable locale rather than have one managed by a rich owner in a solid market?

Kukla's Korner: "The NHL had been propping up the team financially and looking for a new owner who would keep the team in Phoenix. They had been trying to do this quietly, but the media got wind of it. It looked like the NHL had found their owner to keep the team in Phoenix. Jerry Reinsdorf, the owner of the Chicago Bulls and White Sox, was willing to buy the team at a cheap rate.

This idea didn’t go over very well for current owner Jerry Moyes. Why should he have to sell the team for a low price? He had a back-up plan. He had been negotiating with Jim Balsillie ... These negotiations had been ongoing - but unknown to the NHL."

Steve Simmons, Sun Media: "If Balsillie’s bid is accepted, the league will get its money back. If Balsillie's bid is rejected, the league will still be out $35 million. So how, if you’re Bettman, do you explain to your fellow owners that you are acting in their best interest in turning down repayment of league money in an economy where that is next to impossible?

"A high-end insolvency lawyer, who has been involved in other NHL transactions in the past, believes that Balsillie won’t be turned down by the bankruptcy court. He believes that a great deal of work went into structuring the offer, making certain that few loopholes were left unexplored and that the first responsibility of the court is to look after the creditors and not worry about franchise movement in the NHL."

The Globe & Mail: "Little Canada was marginal to the future that Mr. Bettman foresaw for the NHL (in the 1990s). Here, though, is big Canada, the Canada of high technology, globally aware, wealthy enough to rescue the financially distressed. And Mr. Bettman is putting up no end of roadblocks.

"His battle is not in the best interests of the game. There is no business case for it. The Phoenix franchise is ownerless (the NHL has been paying its bills), its revenues are in decline, and the marketplace is tough. Southern Ontario has a staggering appetite for hockey. It can't lose. But this seems personal with Mr. Bettman. This is a classic case of a chief executive officer who has been in the job too long; he clings to a failed strategy and puts personal vendettas ahead of the organizational good."

Anaheim Ducks left wing Teemu Selanne, via Jeff Blair: "Canada deserves more teams. It's sad that franchise (the Coyotes) has to move again. (But) there's always a market for one more team (in Canada)."

It needs to be said: Bring back the Jets

The blood feuding between Jim Balsille, Gary Bettman and now Jerry Moyes has an honourable end. If the NHL won't go to Southern Ontario because of the potential financial damage to the Leafs and Sabres, The Coyotes should just go back where they came from.

They need to go back to Winnipeg.



For all those who believe this idea is full of crap, hear me out.

The arguments against such a move are usually the following:

Winnipeg is too small.

Winnipeg never supported the team with butts in the seats.

There isn't enough corporate support.

The MTS Centre is too small.

The NHL's Salary Cap keeps rising to points where the Jets could not be profitable.

I don't agree. Not anymore, with 13 years of sober second thought.

The Jets left in 1996 because there was no arena suitable for an NHL team. Yet fans still came and made the old barn one of the loudest around.

While no Stanley Cup games were ever won there, there were historic games involving the Winnipeg Jets during a time when they had one of the best teams in the game.

While the MTS Centre would be one of the smallest in the league, it would be one that's filled to capacity now that the NHL's been gone for 13 years, just like in Minnesota. If concert attendance is any indication, I would expect 15,000 paying customers a night and that's better than a lot of existing franchises get. Prior to the recent surge in interest in Boston, were competitive with an Original Six franchise and a couple of others . And it's better than Phoenix actually gets now.

To be fair, there were nights where attendance dipped to around 9,000, when it was -40 C without the wind chill when the franchise's future was in doubt, but I'd bet no less than 90 per cent of those people PAID FULL PRICE for their tickets. Try that in Phoenix 90 per cent of the time.

Any argument that Winnipeg is simply too small to support an NHL team probably needs to look at the example of a pretty successful corporation.

Maybe you've heard of it. Ikea.

Stats Canada says the metro area is 712,000 people as of 2007 and shows slow growth every year since 1991, save for 1997, the year of the Flood of the Century. After years of saying Winnipeg needed 1 million people for a store to be profitable, Ikea has decided to set up shop in the city. That's a pretty significant change of heart for a multinational that makes billions in profits.

They aren't the only ones making such a move.

In Ikea's case, they probably figured out that people in the Canadian prairies will drive longer distances if they want something because they are more accustomed to doing it. People living 90 minutes from city limits will buy season tickets for the Jets. This may not apply in Winnipeg itself, as some people won't drive across the city for a date. But people REALLY love hockey in this neck of the woods.

As for corporate support, I can't argue with economics. Southern Ontario has more corporate dollars. With roughly 12 million people to serve, there will be. But here's another kicker. Car companies are hurting. Steel mills are hurting. Manitoba's economy has not suffered like others. And there's simply enough proof out there that the city can support the team and make money at it. That's better than several other places already on the map.

But logic may not win this argument with Mr Bettman. Arrogance will.

The start of Balsillie season

Obviously, the rooting interest is that BlackBerry boy, Jim Balsillie, has found a way to split the defence pair of MLSE and Gary Bettman.

Others have already pointed out that in a Chapter 11 proceeding, the court typically makes its ruling based on what's best for the creditor(s). In other words, it would go beyond the NHL's the court says what's best is for the Phoenix Coyotes to be sold to this group which will only buy on the condition it can relocate the team. You can imagine the legal wheels spinning.

The chain of events, you know about: Balsillie sounded off about buying the Coyotes and assuming the franchise's debt as long as he can move it into Southern Ontario. Within 25 minutes of Balsillie putting out his press release, a second one went out saying the Coyotes have filed for Chapter 11 reorganization, which "include(s) a proposed sale of the franchise to PSE Sports & Entertainment, LP, a Delaware limited partnership ... which would move the franchise to southern Ontario, Canada."

Sure, it would have be a frosty Friday in July before MLSE would give up its turf in Toronto, but that bridge won't have to be crossed for a while. There might be very little that Bettman or the Leafs could do to stop it. A settlement with some compensation for territorial rights seems fairly plausible.

Puck Daddy believes it will happen:

"So the franchise that relocated from Winnipeg in 1996 appears on the brink of moving back to Canada. The near-fanatic obsession of the Canadian media with the failure of this franchise — fueled by a desire to 'get one back' from the States, or to see Wayne Gretzky coaching a Canadian team, or both — appears to have been warranted."

Here's what Balsillie said:

"The current team ownership asked that I table an offer to purchase the Coyotes and significant discussions resulted in an offer that is in the best interests of the franchise, the NHL, and the great hockey fans of Canada and Southern Ontario.

"... I am excited to move closer to bringing an NHL franchise to what I believe is one of the best un-served hockey markets in the world, Southern Ontario. A market with devoted hockey fans, a rich hockey history, a growing and diversified economy and a population of more than 7 million people." — via press release

It can be conceded that people are probably getting Balsillie fatigue at this point and don't want to hear about it until he either does succeed in repatriating a franchise from the U.S. Sunbelt or gives up. Your guess is as good as any as to which is more likely.

Chicago Bulls/White Sox owner Jerry Reinsdorf is also rumoured be kicking the tires with the Coyotes. The players' association has a vested interest in seeing a second team put in Southern Ontario. It wouldn't hurt the Toronto Maple Leafs one bit. The competition would be good for both sides.

Who knows if Jim Balsillie will succeed, but you have to admire his chutzpah. The NHL might not like the way he carries himself, but money-wise he's good for it as far as anyone knows, unlike some of the folks the NHL has welcomed into the owners' ranks. He's wanted a NHL team he can move to Southern Ontario (did you notice he never said he was interesting in buying the Montreal Canadiens?)

According to blogTO, more than 2,000 people signed up at makeitseven.ca within 100 minutes of its launch.

The NHL is going to make this very hard for Balsillie and pull out every stop. Keep that in mind.

Related:
Balsillie Makes Offer To Purchase Phoenix Coyotes (Canada NewsWire)

NHL: Kelly point man on second T.O. team

One of the most interesting aspects of this week's report (David Shoalts, The Globe and Mail) that a group of businessmen is looking to bring a second NHL team to the Toronto area (myself, Sporting Madness) was the involvement of NHL vice president Bill Daly and NHLPA executive director Paul Kelly (pictured).

These rumours have been swirling for quite some time and were at the level of informal discussions between NHL governors back in October, but now they've progressed to formal meetings with two of the most important men in the league. Only Daly theoretically has any control over where a team might wind up. Kelly's involvement may prove even more crucial.

The key to this entire discussion is the economics. There's a good reason that the Leafs are far and away the most valuable team on Forbes' list, weighing in at $448 million. They're $37 million ahead of the next closest franchise, the New York Rangers, despite most of their revenues being in depressed Canadian currency and their costs being in U.S. dollars. Southern Ontario has an incredible population of hockey obsessives and the Leafs have a near-stranglehold over the market. They can charge whatever they like for tickets, merchandise and the rest, and you can bet that people will still queue up to pay it. A good deal of fans from Hamilton and St. Catharines make the pilgrimage down to Buffalo, but that's partly due to the lack of tickets available in Toronto.

However, some things are more important to the NHL than economics in the Gary Bettman era. Consider how Jim Balsillie's huge overbid to buy the Nashville Predators was turned down in favour of a smaller local offer that involved such men of integrity as Boots del Biaggio (Allan Maki, The Globe and Mail). There's a great deal of prestige at stake here; Bettman's legacy rests on trying to sell hockey in the United States, and moving a team back to Canada will undermine that, even if it makes solid business sense.

That's where Kelly comes in. The NHL and NHLPA are said to be partners under the current collective bargaining agreement, a vast change from how things have happened in the past (The Puck Stops Here). Yes, Alan Eagleson had plenty of influence on the business side of the league, but most of that wasn't from his role as head of the players' union and that didn't really work out too well for the players. Kelly has already demonstrated a willingness to comment on decisions that heretofore would have been the exclusive province of the league, such as European expansion and television deals (Sports Business Daily).

Because the players' fortunes are now directly tied to the league's revenues, he has a duty to lobby the NHL to make sensible business decisions. He also has a considerable amount of influence to use; the NHL will assuredly need the players onside in the current economic struggles, and you can bet that the NHLPA isn't overly happy that the league is propping up Phoenix.

The key difference between this later proposal and the earlier attempts at a team in Kitchener or Hamilton is the geography, which I detail in a couple of Google Maps here. This proposal would bring a team to Vaughan, which is north of Toronto's downtown. Hamilton and Kitchener are south of Toronto and closer to Buffalo, so a team in either area would have a sizable impact on the amount of people willing to cross the border to watch the Sabres.

The Leafs are in better financial shape than the Sabres and will still prosper with a second team in Toronto; their history and legions of fans will ensure that they can still charge the highest prices in town and arrange the best corporate sponsorships and television contracts. Thus, from the point of view of either the league as a whole or the players' association, this proposal would considerably strengthen one club (whichever of the troubled franchises moves into the GTA) without appreciably weakening any of the other franchises. That makes tremendous economic sense for all parties involved, and that gives Kelly and the players considerable motivation to convince Bettman that the health of the league is more important than saving face.

There's still a long way to go before this could happen. A new arena would be needed, and that's never a simple process, especially when a team is still a far-off prospect. The question of how much the new team would have to pay in territorial rights is also one that doesn't have a clear answer yet, and that could make a big difference. We don't even know if MLSE would give up their monopoly for any amount of money, and that may be the most important question, as Stephen Brunt points out.

However, there are a lot of people interested in this idea, including former Leaf Kevin Maguire, who's heading up the Vaughan group (Shoalts). Not all the owners are happy with Bettman's recent moves, and you can bet they won't be willing to prop up money-losing teams like Phoenix indefinitely when hugely lucrative markets like the GTA await.

This is where the support of Kelly and the NHLPA could be crucial; an alliance between the players and some of the owners might be enough to force Bettman to allow this and reduce MLSE's complaints to save his own neck. We also haven't seen the full impact of the economic crisis on the NHL yet, and the lack of playoff sellouts in some crucial markets (Greg Wyshynski, Puck Daddy) may be a troubling sign. If times get bad enough, Bettman may be forced to choose to save the league instead of his reputation, and pressure from Kelly may play a role in convincing him of the eventual necessity of this move. It won't happen instantly, but this makes far too much financial sense for it to be dismissed forever.

(Kelly photo from Puck The Media.)