It’s always a little disorienting when Canadians act like Americans, and vice versa.
In November, 2013, when Rogers Communications announced it had snagged a 12-year agreement for the national rights to NHL games, both the league and the telecom-media behemoth proudly trumpeted that the deal was worth $5.2-billion.
There were multiple reasons to put a public price tag on the deal – bragging rights for the league and Rogers, as well as the need to explain to Canadians why their public broadcaster, which would end up airing the games on its TV network but without the benefit of any revenue – hadn’t actually stood a chance in the bidding. But there was also a giddiness to the announcement – Canadian media companies rarely reveal the grubby details of their business, if they can help it – and a downright American-style swagger.
Contrast that to the announcement on Wednesday by the NHL, the Walt Disney Company and its ESPN division of a seven-year deal under which the league would return to that sports service for the first time since 2005. Executives called the arrangement, which is largely focused on delivering hockey on a growing array of digital platforms, “innovative,” “first-of-its-kind,” and “unprecedented.”
(The deal will not directly affect Canadian hockey fans, who do not have legal access to ESPN.)
But when a reporter asked Gary Bettman during a news conference, “Are you going to tell us what the value of this deal is on an annual basis?” the NHL commissioner shrugged and said, “I wasn’t planning on it.” Pressed by the reporter as to whether describing the value of the deal as “a substantial increase over what [current NHL rights holder] NBC is paying [would] be accurate,” Bettman gazed off to the middle distance and, channeling his inner Canadian, replied: “The answer to your question is, we think we’ve become more valuable over time.”
If one had to speculate – and in the absence of confirmed numbers, why not? – you might think the league’s modesty stems from the fact that the value of the contract, as reported by the Washington Post, is more than US$2.8-billion, or about US$410-million a year.
Which is fine as far as it goes, but not a number that Bettman is going to scream from the rooftops, given how it pales in comparison to the multibillion-dollar annual rights fees of the NFL, NBA, and MLB. (It’s also not significantly more than what Rogers Sports & Media is currently paying to air its national NHL games.) But in a landscape where some sports-media rights are believed to be at their peak, you can understand why any league would cheer the increase.
Still, there was plenty of swagger in the air when both Bettman and Jimmy Pitaro, the chairman of ESPN and sports content for the Walt Disney Company, laid out the details of the deal, which begins with the 2021-22 season: 25 regular-season games annually as well as four Stanley Cup final series over the next seven years on the over-the-air network ABC; and another 75 national games for ESPN+, the cable channel’s growing streaming service and the subscription service Hulu, which is partly owned by Disney.
An ESPN+ subscription will now also include about 1,000 out-of-market games, which were previously part of a separate package known as NHL.TV. (The NHL also reserved a package of less-valuable games which they’ll sell as part of a separate deal with another broadcaster, possibly NBC.)
Pitaro said one reason he wanted to bring hockey back to Disney was because the NHL has an enviably young audience that he believes could help drive new subscriptions to ESPN+. “We’ve seen the largest growth in fandom among the major professional leagues since 2005,” with viewership in the current season among the 18- to 49-year-old audience “up around 30 per cent. … All the younger demos are up double digits,” he said.
“That’s all music to our ears. As we look to attract the younger generation, we think NHL content, live games, are going to significantly help us.”
That younger generation is leading the migration from TV to digital platforms, and if the league doesn’t go to where viewers are heading, those fans will find something else to watch.
“This is a transformative time in media, especially sports media,” Bettman said. The new deal “reflects the reality of what the media worlds are looking like. Everybody knows that there’s cord-cutting and everybody knows that the streaming platforms are growing dramatically and we think at some point, probably relatively early on in this deal, there’s going to be a convergence,” as streaming overtakes traditional TV viewership.
“This is an opportunity for our younger fans, to give them what they want on the places where they go for content,” Bettman explained. Though he didn’t say so, he probably also hopes that, by making games more available on digital services, the younger fans who are most prone to use pirated streams may decide to pay for their hockey content.
Bettman and Pitaro kept calling the deal unprecedented, but to Canadians it must have sounded familiar. The Rogers deal, too, led to a bonanza of hockey available on multiple platforms: broadcast (CBC and CityTV), cable (Sportsnet) and streaming (Sportsnet NOW as well as its premium version, Sportsnet NOW+, which, like the new ESPN+ offering, includes hundreds of out-of-market games).
The fact that a company with the market intelligence of Disney has signed up for a similar deal (albeit with a potential audience of 10 times as many consumers) suggests that those who were skeptical of the Rogers deal might need to give the company some credit.
Mind you, as details of the Disney deal emerged Wednesday afternoon, and hockey fans began to realize it likely means they’re going to have to subscribe to both their regional sports network and ESPN+ if they want to watch their home teams – a situation that is also familiar to many Canadian hockey fans with subscriptions to both TSN and Sportsnet – many cried foul.
That’s the thing about the future: It always comes with a price tag.