When Toronto Maple Leafs president Brendan Shanahan set the hockey world on its ear in the summer by first hiring head coach Mike Babcock and then general manager Lou Lamoriello, no one was cheering harder than the executives at Rogers Communications Inc.
Rogers chief executive officer Guy Laurence may have claimed a "10-per-cent" profit in the first year of the company's 12-year, $5.2-billion national broadcast contract with the NHL, but the 2014-15 season was still a bumpy ride. Most of the turbulence was caused by the Maple Leafs, which as the favourite team in Canada's largest television market drives the ratings more than any other.
The Leafs collapsed in January, as did the ratings on the CBC, Sportsnet and City, the three main networks for Rogers' hockey shows. The playoff ratings were better but not enough to undo the damage caused by the Leafs.
The challenge facing new Rogers Media president Rick Brace, who took over in early August after Keith Pelley left to be chief executive officer of the PGA's European Tour, is to prevent that hockey profit from becoming a loss once the second season begins Wednesday night. He has two problems here. One is that while the payments to the NHL are an average of $430-million over 12 years, the broadcast deal is structured so they are not paid that way.
Instead, the contract calls for the smallest payment in the first year, which likely went a long way to creating that profit for Rogers, and then an increase of around 5 per cent a year. If the ratings troubles persist – and advertisers already resisted Rogers's price demands in Year 1 – then making a profit will be increasingly difficult.
Sources inside Rogers say Brace was hired as much for his skill at trimming the fat from budgets as for his acumen as a broadcaster. While Rogers remains in full cost-cutting mode, the erosion of cable and satellite customers means this is not exclusive to that company. Rival telecommunications giant Bell, which does not have a massive hockey contract to pay, is in the midst of shedding employees across several divisions, including Bell Media.
Scott Moore, president of Sportsnet and NHL properties at Rogers, acknowledged the ongoing reluctance of advertisers. "We had to amend our rates for [2015-16] for a number of reasons," he said in a summer interview. But by this week, Moore said, "our renewals have been really strong."
That will depend on the other problem – the Leafs. Despite the additions of Babcock and Lamoriello, the Leafs are not expected to be much better this season. While having Babcock behind the bench should boost the early-season ratings due to the curiosity factor, there is no reason to think the overall numbers will be better than 2014-15.
One Rogers employee, who spoke on the condition of anonymity because the information was not for public consumption, said the average television ratings for Leafs broadcasts fell by 60 per cent from the start of the season, when 2,024,500 viewers watched them play the Montreal Canadiens on opening night.
The number of viewers dipped as low as 121,000 (April 8, versus the Columbus Blue Jackets) for adults ages 25 to 54, the most prized demographic for advertisers. But the Leafs' viewers did come back for games with their top rival, as 2.3 million watched their regular-season finale versus the Canadiens.
Even worse, in the NHL's salary-cap system, turning a dog into a consistent contender can take many years. The Chicago Blackhawks, for example, took eight years to win a Stanley Cup from the time they drafted star defenceman Duncan Keith in 2002. In five of those years, they missed the playoffs.
This leaves Rogers facing the unpleasant prospect of seeing the Leafs' long run as a mediocrity continue for as long as two-thirds of the length of their NHL contract. When this scenario was raised with Pelley not long before he left his Rogers post, he smiled uneasily and said, "We have our faith in Brendan Shanahan."
Moore hopes Shanahan's acquisition of Babcock and Lamoriello will shorten the rebuilding period.
"I believe there's going to be a heightened interest in the Leafs at the beginning of the season with Babcock," he said. "I also agree with Don Cherry: They're going to be more competitive than people give them credit for. I think Babcock will get more out of them than his predecessor."
In the meantime, look for a steady diet of Connor McDavid to cure low ratings. The NHL debut of the Edmonton Oilers' young star will be front and centre on Sportsnet Thursday night. The network plans to show between 30 and 32 of the Oilers' games nationally this season "with a much higher profile this year," Moore said.
The playoffs only provided a partial relief from the regular-season ratings woes even though five Canadian teams made the postseason. This gave Rogers a strong boost over the previous year's ratings, up 36 per cent in the first round. But the Canadian teams were all gone by the third round – and with them went the ratings.
This pattern of mixed results persisted on the production side, too, as Rogers took control of Hockey Night in Canada from the CBC and gave it a new look along with its Wednesday night and Sunday night shows. The game crews, led by the top team of play-by-play broadcaster Jim Hughson and analysts Craig Simpson and Glenn Healy, maintained the excellence established over the years when the CBC produced the show.
"For me, it was total satisfaction," Healy said, referring to the addition of some top talent from Sportsnet and rival TSN to the CBC holdovers on the production crew. "Looking at some of the guys they brought over from some of the networks, you're not getting a better [production] truck than that anywhere in the world."
Also happy by the end of the year was Cherry. He was not pleased early in the season, when his Coach's Corner intermission segment with Ron MacLean was strictly limited to five minutes by the new producers and let the world know about it.
"It went great for me," said Cherry, who is entering the final year of his contract with Rogers, although there are no signs he wants to slow down. "Coach's Corner is a little shorter than I wanted but everything worked out, so I have no complaints at all."
Maintaining that excellence will be another challenge. While there are no major changes coming this season for the on-air side of Hockey Night, there was a major loss behind the scenes.
Sherali Najak, 46, the long-time senior producer of Hockey Night, stepped down for a reduced role as a game director and mentor to young producers. The senior producer is the quarterback of a broadcast and Najak was renowned as one of the best at keeping the many balls in the air on live television. Veteran hockey producer Mark Askin will be Najak's replacement with a few others taking a hand as well.
Moore tried to talk Najak out of his decision but Najak said "I just felt I needed a change." Najak declined to go into detail about the move. But some of his colleagues said a factor along with Najak's desire for a better work-life balance was the challenge of trying to maintain Hockey Night's excellence in the face of Rogers's budget cutbacks.
At this point, the only noticeable effect of the budget restrictions will come after the evening's NHL games. Sportsnet cancelled the late-night version of its hockey highlights show, Hockey Central. However, Moore said even though Sportsnet saved "a bit of money" with the cancellation, the reason for the move "was simply programming" because the show could not be fit into a consistent time slot because the NHL games do not end at the same time every night.
There are no major on-air changes for the broadcasts, which may be a disappointment for some viewers when it comes to Hockey Night host George Stroumboulopoulos. He became the flashpoint for viewers after he replaced long-time Hockey Night host MacLean one year ago.
Stroumboulopoulos, 43, was a 180-degree turn from MacLean, 55, a smooth, traditional host who was steeped in NHL knowledge. The new host was quickly the subject of much criticism from the viewers, traditionally an older and conservative group, that was expressed on social media, in polls and in comments attached to online media stories.
It was not just Stroumboulopoulos's middle-aged hipster shtick with his twentysomething wardrobe that bothered the fans. Canadians demand the host of their favourite hockey show be immersed in the game and there was no sense of that from Stroumboulopoulos, a good broadcaster but one who spent most of his career on the entertainment side of the industry. A look at his Twitter feed (@strombo) shows his interests mostly remain in music, television and film.
Late in the 2014-15 regular season, for example, he sent word to The Globe and Mail through a Rogers executive he was not doing print interviews because he was "boning up" for the playoffs. One cannot imagine MacLean or TSN's hockey host James Duthie, who manages to mix his knowledge of the NHL with a strong sense of humour, having to do the same thing.
The only obvious result from the study sessions was a penchant by Stroumboulopoulos for tossing up some trivia-style statistic as his observation on the period of playoff hockey he and the viewers just saw. However, do not expect a big change in style this season. Moore said he and his fellow Rogers bosses are happy with Stroumboulopoulos's first season because they did not want him to get into heavy hockey discussions.
Moore said part of the reason Stroumboulopoulos was hired was Rogers's desire to pursue a younger audience, but they also wanted him to concentrate on his strength as an interviewer.
"My assessment of George is he did exactly what we asked him to do," Moore said. "We asked him to be more conversational, to be the everyman host as opposed to a host who was trying to compete with his analysts for hockey knowledge."
Among the analysts and reporters, two new stars emerged, although both were already significant people in hockey broadcasting. Sportsnet regular Nick Kypreos added the intermission panel on Hockey Night to his Wednesday duties and continued his strong analysis and reporting.
Also stepping up was CBC holdover Elliotte Friedman, who served as a panelist and reporter. While the NHL likes to make sure its rights holder gets its news first and the shift in this from TSN to Sportsnet was seen as the season progressed, Friedman is a strong reporter in his own right. He broke a lot of stories on his Headlines intermission segment with Damien Cox. Headlines will be used on other nights in addition to Saturdays this season, such as some regional Maple Leafs games and even Sportsnet's Tim & Sid supper-hour show.
Something new for hockey fans last season was the Sunday night show, Rogers Hometown Hockey, with MacLean as the host. He and the crew broadcast from a different town or city each week. Again, the results were mixed, as the show averaged 567,000 viewers, up 19 per cent from the non-hockey programming on City the previous year but down 7 per cent from the non-Wednesday games on TSN in 2013-14.
Moore says the value of the Sunday show comes from its connection with the people in each of the communities MacLean and company visited as much as the ratings. While he said the Wednesday and Saturday shows fell a little short of his goal of telling compelling stories between the hockey action, that was not the case on Sundays.
"The community and the stories were the stars," Moore said. "What you'll see is we ramp up what we do in the community even more next year."
There will be a couple of other changes, too. The show was pulled from City and will be shown solely on Sportsnet in a bid to increase the ratings. And Tara Sloane will appear full-time on the show with MacLean. She will concentrate on the community side of the show.
"It [also] gives us another bit of star power for the local community, so it won't just be Ron who has to go sign autographs after the show," Moore said.
The ratings slide that struck in the third round of the playoffs was not Rogers's fault, as no Canadian teams means fewer viewers. But there was some self-inflicted damage in the second round, during which Rogers elected not to show the series between the Calgary Flames and Anaheim Ducks on CBC and restricted it to Sportsnet. Given the greater reach of CBC, this probably cost at least 100,000 viewers a game, as the series lagged the New York-Washington series on CBC, which averaged about 1.5 million viewers.
However, Moore said the switch was intentional. Rogers wants to attract more subscribers to Sportsnet, so it was willing to take some short-term pain "so people know if they want the full hockey picture they have to get Sportsnet."
Something else Rogers had to deal with in the playoffs was NBC's control over the playoff schedule. Even though Rogers pays more money to the league, it could not get NHL commissioner Gary Bettman to give it equal or greater say than the U.S. network. Hence a couple of weekends in May, when there were no prime-time games on a Saturday night because NBC prefers afternoon games. This, too, did not help the Canadian ratings.
The scheduling problem was the subject of much discussion between Moore and Bettman this summer. Moore said progress was made and "I would be surprised to see afternoon games in the conference final [next spring]."
Over all, Moore said he gives his hockey team "a 7.5 out of 10. We were about 6.5 to start and more like an 8.5 in the playoffs. Our storytelling was one of our strengths, but we didn't do enough of it. I think you'll see a better balance between studio and storytelling [this season]."
A lot of the volume of complaints about Rogers's version of hockey can be put down to the fact people simply do not like change, especially to a national institution. Moore agrees, comparing the situation in the United States to 1993, when Fox muscled its way into the lion's share of the NFL television rights.
"Fox did a lot of things that at the time were seen as really radical," Moore said. "My memory is people were very critical. Now, you see who is perceived to be the best at football and it's Fox.
"You have to be aware of giving people what they want and you also have to be true to the vision you create."
The biggest challenge remains on the business side. Rogers's advertising sales team met a lot of resistance going into the first year because it touted a 20-per-cent increase in viewers and wanted a similar increase in ad rates. Traditional hockey advertisers such as Canadian Tire and Tim Hortons refused to buy title sponsorships, where the company's name goes on the show and where the big dollars are, and stuck with buying ad time here and there, which was a blow to Rogers.
Sources in the retail industry familiar with the strategy of Canadian Tire and Tim Hortons say the only issue with those companies was cost. In the case of Canadian Tire, the company remains interested in a greater relationship with Rogers but only at an acceptable price. So far, Moore said, talks with Canadian Tire and another potentially big advertiser, Subway, are promising.
With the prospect of another season of poor ratings thanks to the Maple Leafs, plus an increase in the annual payment to the NHL, the chances of staying in the black are not good. Rogers also has to fight the belief in the advertising business that companies do not have to rush to buy hockey advertising just because there is a new deal between Rogers and the NHL.
"From the buying side of the industry, there was already more than enough hockey product out there that wasn't selling out [before the Rogers deal]," said Terry Horton, managing director at advertising agency Touché! "The CBC, for example, was managing the hockey inventory and there was always more inventory than demand."