Despite the Stanley Cup finals starting in Vancouver tomorrow night, True North Sports and Entertainment and the National Hockey League made Winnipeg the centre of the hockey universe today, announcing its purchase of the Atlanta Thrashers at a much-anticipated press conference at the MTS Centre.
The deal marks the league’s return to Winnipeg after the Jets flew south to Phoenix in 1996, thanks largely to skyrocketing player salaries and a nosediving loonie. But while crowds of cheering fans clad in all things Jets hit the streets to celebrate, both True North heads Mark Chipman and David Thomson, along with NHL commissioner Gary Bettman made it clear that money is still an issue.
“It isn’t going to work very well unless this building is sold out every night,” said Bettman.
The new owners, who paid a reported US$170 million for the team, unveiled a season-ticket drive for the 15,000-seat MTS Centre with the goal of selling 13,000 season tickets. Single game ticket prices start at $39, with an average price of $80.True North owns the arena, opened in 2004, which cost $133.5 million to build, including $40.5 million from the city.
Back in 1996, the Jets had trouble attracting much more than 11,000 fans in their last NHL season but as the Conference Board of Canada said in a report earlier this month, plenty has changed in the city since then. The report presented four pillars that make an NHL team successful — market size, income levels, corporate presence and level (financial) playing field — and said Winnipeg meets each one. The Canadian dollar remains strong, the city has Canada’s fifth highest median income and is home to more major corporations than both Edmonton or Ottawa.
That said, as Damien Cox pointed out in the Toronto Star, a lot has changed in the NHL in the last 15 years as well. Total league revenues are almost US$3 billion, up 50 per cent in six years, and the salary cap, less than $40 million after the lockout, will soar past $62 million next season.
Local businesses are also cheering the return of the NHL, hoping its cachet will help attract new companies, keep current ones and persuade new conventions to visit. Ivey School of business economist Mike Moffat says that while it could very likely aid in that respect, studies show that the overall economic impact of sports teams is typically low.
“In terms of growth, it’s about looking at new money coming in that wouldn’t have been spent in the community anyway,” said Moffat. “Families don’t have unlimited entertainment funds, so buying hockey tickets will simply replace spending that money at the movies or something else.”
One area where Moffat does see potential is the team’s ability to help dissuade some of the city’s young people from moving elsewhere. But overall, Winnipeggers can expect a bigger boost in civic pride than to the city’s bottom line. “I don’t want to suggest there are no benefits, but it is very easy to overstate them,” said Moffat. “You’re looking at maybe five to 10 percent new money, which is still significant.”