The National Hockey League is close to a deal that will keep Hockey Night in Canada on CBC for the next decade, but the exclusive rights won’t come cheaply for the cash-strapped public broadcaster.
The deal would be part of a wide-ranging agreement that ensures Saturday night and Stanley Cup Finals broadcasts remain key components of CBC’s programming, but would see broadcasting rivals Bell Media and Rogers Media bulk up their schedules with more playoff games. One of the competitors – likely Rogers – will also score the rights to an exclusive Canadian game on Sunday nights.
CBC is expected to pay up to $200-million a year, almost double its current fee, to keep Hockey Night in Canada, sources said. President Hubert Lacroix hinted at the end of the broadcaster’s annual public meeting last month that a deal was imminent, and sources said it could be wrapped up in the next two weeks.
CBC had exclusive negotiating rights through the summer, but found itself at a busy negotiating table through the fall as the NHL tried to take advantage of the other broadcasters’ interest. Striking a deal soon would eliminate a major distraction, and allow it to focus on coverage of the Winter Olympic Games, which begin in 73 days.
Neither the league nor the broadcasters would comment on the negotiations, which could also result in the All-Star Game moving from CBC to TSN. But the Canadian deals come as the league enjoys a surge of popularity following a labour dispute that saw half of last season cancelled; the NHL signed a 10-year rights contract with the U.S. network NBC in 2011.
“The NHL is the premiere television property in the country,” said Gord Hendren, president of Charlton Strategic Research, which tracks sports trends. “And that’s largely because of the audience it can draw on Saturday night. Something like the Grey Cup may draw more individually but, night-in and night-out, the NHL delivers that audience.”
Hockey Night in Canada has been broadcast on CBC since 1953, and has pulled an average of about two million viewers per night for its early game and one million for the late game. The rights are essential to maintaining the broadcaster’s other programming, because without it the CBC would lose as much as $175-million from its $450-million of annual advertising revenue.
The league has flourished since the lockout – TV ratings are up and franchises are now on healthier financial footings. A report by Forbes released Monday found the average NHL team had an enterprise value (equity plus net debt) of $413-million, 46 per cent higher than a year ago.
For the first time since Forbes began tracking NHL team values in 1998 (in U.S. dollars), three of the league’s five most-valuable teams – the Toronto Maple Leafs ($1.15-billion), Montreal Canadiens ($775-million) and Vancouver Canucks ($700-million) – are Canadian. The New York Rangers ($850-million) and defending Stanley Cup champion Chicago Blackhawks ($625-million) are the two U.S. teams to make the current top five, Forbes reported, adding: “And this is also the first time that every Canadian franchise ranks among the top 16 in the 30-team league.”
Live sporting events are considered one of the few reliable cash cows for broadcasters, because viewers prefer to watch live and are less likely to zip past commercials. Another important trend also helps explain the CBC’s willingness to cut a large cheque at a time when its government funding is decreasing: The league’s audience skews to males aged 18 to 34, and they are increasingly turning to mobile devices for NHL-related content.
Charlton Strategic Research found 70 per cent of viewers in that sought-after demographic reported visiting a broadcaster’s website or mobile offering for related content while watching a game. That allows the rights-holder to sell advertisers more than just the actual game. It can also offer them a package that includes digital sponsorships and online ads.
“That is crucial in figuring out how to monetize the rights,” said Hendren. “The CBC is likely going to pay more than it would like to and will have to think about how it gets that money back. You can add a whole other layer of sponsorship, because you have multiple touch points with the consumer.”
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With a file from Simon HouptReport Typo/Error
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