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Editorials NHL expansion: Why Canada is always the last draft choice

NHL Commissioner Gary Bettman speaks to the media prior to the start of the NHL Stanley Cup hockey finals in Chicago, Illinois, June 12, 2013. REUTERS/Jim Young (UNITED STATES)

JIM YOUNG/REUTERS

Quebec City recently completed a major public infrastructure project ahead of schedule, and under budget. The normal course of events would see its spanking new, $370-million arena occupied by an NHL team. That's why so much (public) money went into the building. The timing even looks to be ideal, as the league is in the midst of receiving applications for expansion franchises; two cities could advance to the next stage. What's more, there are only two bidders – aspiring owners in Quebec and Las Vegas – for those maximum two expansion slots. The return of hockey to hockey-mad Quebec would seem to be as easy as scoring an empty-net goal from inside the crease.

It isn't.

Anyone distracting themselves from the summer heat with daydreams of a revived Nordiques vs. Montreal Canadiens rivalry (The Battle of Quebec! The Good Friday Massacre!) had best take a deep breath. Just because Québecor principal shareholder/aspiring premier Pierre Karl Péladeau and irrepressible Quebec City Mayor Régis Labeaume built the Vidéotron Centre (with, we again note, a massive helping of taxpayer dollars) doesn't mean the NHL will come.

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If anything, the NHL appears eager to avoid Quebec City, or any other location in hockey's northern homeland. Here's looking at you, Hamilton. Los Angeles has two NHL teams but the Toronto area still has but one; artificially limiting hockey supply in the biggest hockey market on Earth predictably leads to the Leafs recording league-topping revenues, year after year, regardless of their record on the ice.

Winnipeg only got its Jets back in 2011 because, when the Atlanta Thrashers went into financial cardiac arrest, Winnipeg was the one hospital available. It was a similar story for Calgary in 1980, after an earlier attempt at Sunbelt expansion failed: When the Atlanta Flames flamed out, they were moved north. (Recite now the Canadian Hockey Fan's Prayer: Almighty NHL, we beseech thee, put another team in Atlanta. Please.)

At first glance, Quebec City's bid ticks all of the league's boxes: deep-pocketed corporate owner, ready-made television deal, rabid fan base and, of course, a state-of-the art arena, gifted by taxpayers. It might not matter.

One of the benefits of running a cartel is that it, and not the market, sets the rules. In what other business is a prospective entrepreneur required to plead, cap in hand, with all of his North American competitors in order to set up shop? And then cut them a fat cheque for the privilege?

There is no National Restaurant League limiting the number of restaurants on the continent to 30, with expansion to 32 conditional on new members paying a fee. In any other business, this would look suspiciously like restraint of trade. The NHL has a lot in common with various taxi monopolies currently being undone by Uber. Only there's no Uber to disrupt pro hockey.

League commissioner Gary Bettman and the team owners seem strangely preoccupied with restoring conference balance – there are currently two more teams in the East than in the West. Quite why expansion, and not simple realignment, is the preferred solution isn't all that clear. But most importantly, the league longs to build its U.S. presence, in media markets far bigger than Quebec City. Quebeckers, like all Canadians, already consume enormous quantities of televised hockey. Americans, especially the U.S. Sunbelt? Not so much. All of which puts Las Vegas in the catbird seat.

True, the NHL merely needs to name its price and Québecor will stroke a cheque. A Canadian NHL franchise is that valuable. But if the point were a one-time windfall for the existing owners, surely the NHL would simply allow a second team in Southern Ontario, and even a third. Instead, it's entirely possible that the receipt of only two bids for new teams will mean that the NHL will decide to hold off on expanding until an arena deal is reached in Seattle – another highly coveted market. In any case, adding to the club of owners requires the assent of 23 of the 30 current clubs.

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And keep in mind that the addition of two teams, carrying wtih them a one-time payment of as much as $500-million each (all figures in U.S. dollars), the price the NHL has hinted at, wouldn't bolster an existing owner's bottom line all that much once it's chopped up 30 ways. Expansion would also water down each team's share of the U.S. and Canadian national television deals. Together, those two are worth about $600-million; expansion would split that pie 32 ways rather than 30.

Then there's the league's salary floor. At $52.8-million next season, it has risen almost 150 per cent since 2005. It is rising because some teams are taking in a lot more cash – but many struggling U.S. franchises are not. The upper salary cap limit could top $90-million in the next decade. Have fun making that work, Phoenix.

And yet it may be that, no matter what it does or how attractive a market it is, Quebec City won't get an expansion team. There's a widely held belief that, even though a Quebec team would be an immediate success, the league would rather save the city as a fallback solution, to be used when a struggling Sunbelt club is at death's door.

Four summers ago, the returning Winnipeg Jets sold every one of their 13,000 season tickets – in two minutes. The same would happen in Quebec City. Meanwhile, the prospective Las Vegas owners have received deposits on about 13,000 seats – but getting there took four months. Canada, home to seven NHL teams, should get more eventually. But it may not happen through expansion, at least not directly. Pray for a repeat of Winnipeg's Immaculate Relocation.

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