Connect with us

Bruce Dowbiggin

Your Trash, My Treasure: Playing The GM Shuffle

Published

8 minute read

“One man’s treasure is another man’s trash/ One man’s landing is another man’s crash”—Guy Clark

At the end of a season that saw his Calgary Flames fall from Pacific Division champions in 2022 to out of the playoffs in 2023, general manager Brad Treliving went to ownership of the club. Tired of seeing each Darryl Sutter ignore the products of Calgary’s development system in favour of aging veterans, Treliving wanted a fundamental change of direction for 2023-24. Get younger.

The problem for Treliving is that he had no contract past 2023 while Sutter had two years left at $4M per year on the extension Flames ownership had given him for the 2021-22 performance fuelled by Matthew Tkachuk and Johnny Gaudreau. For the parsimonious Flames the answer was obvious about the coach who’d once led the teams to the Stanley Cup Final in 2004. Sutter and his contract won out.

While the choice of retaining Sutter might have satisfied ownership, it was a non-starter for Treliving, a number of core players on the roster and the fan base— who were bitterly watching Tkachuk lead Florida to the 2023 Final. Treliving was gone from the team he’d run for nine seasons and five playoff appearances. With the implicit defection of some key players, ownership then had president Don Maloney fire Sutter.

Was Treliving the best GM in the league? Maybe not, but his work in turning the departure of Tkachuk into real assets (ones Sutter seemed to waste) was indicative of skill. In the end the Flames had made a choice that cost them both their options. Now they’re left with former hero Craig Conroy making his maiden appearance as an NHL GM. And possibly their AHL coach being promoted. Did we say the Flames are cheap?

Meanwhile in Toronto, wunderkind GM Kyle Dubas had gone from youngest genius in the NHL to shopworn object of scorn to Toronto’s roiling fan base. After seeing his heralded teams win just one playoff series (2023) since 2017, Dubas became the scapegoat for frustrations that go back to 1967. Loaded with costly, flashy stars such as Auston Matthews, William Nylander and Mitch Marner, Toronto seemed to have peaked.

So after some aborted contract talks, Maple Leafs ownership and president Brendan Shanahan said buh-bye Dubas. A hiring committee went in search of a new GM to handle the thorny contract issues Toronto faces under the current CBA. (Namely, would Matthews sign an extension this summer or would he do a Gaudreau and bet on himself in a contract year.)

Meanwhile, the 40-year-old Dubas said he was going to take some time off to consider his options. As holidays go it was a short one. No sooner had the Leafs decided that Calgary’s trash was their treasure, inking Treliving as their new GM, Dubas’ rumination ended with his being named as GM in Pittsburgh on a seven-year deal. What? Next thing you’re going to tell us is that Mike Babcock is coming back after his paid holiday from the Leafs (where Dubas and Shanahan had fired him).

You guessed it. The two-time Stanley Cup winning coach— the winningest coach in Red Wings history— once thought too mean by all the young dudes in the T-Dot was named head coach in Columbus, where he’ll try to motivate Gaudreau— who once found Sutter too abrasive. Go figure.

Fans hoping that new GMs and coaches making bold moves will bring sunny days in 2023-24 will be sorely disappointed as the crunch from Gary Bettman’s vaunted Escrow System will mean a meagre $1M bump in the salary cap for next season. Because of money lost by owners during the Covid Bubble seasons, players are working off an estimated $1.1B debt they owe owners under the terms of the glorious salary-cap capitulation by shutting down the 2004-05 season.

Of course, part of that loss in revenues can be attributed to Bettman’s Folly, aka the Arizona Coyotes, who’ve been a drag on the NHL’s revenue streams even as other clubs make out like bandits. (See: small-market Ottawa Senators estimated to be going for a billion dollars.)  In addition there is probably as much as $70M in “dead” money from ill-fated contracts stuck in the works. BTW, not one player in the socialist republic of Bettman made a max salary in 2022-23 under this scheme accepted by players who cratered in 2004 and fired Bob Goodenow.

With an estimated $6M bump in the cap on July 1, 2024, there will be a lot of kicking the can down the road this summer should Treliving and the Leafs pony up the max salary to keep Matthews. They might also be able to tread water on a few other costly contracts if they trade Matthews south to a U.S. destination.

As we’ve written lately , trying to keep American stars in cold Canadian cities where they’re in a fish bowl 24/7 is becoming an issue. Many will look at Tkachuk appearing as a guest on the NBA Playoffs broadcast as indicative of what can happen if they move to a tax-free state like Texas, Tennessee, Nevada, Florida and yes, Arizona.

So the GM faces may be new in Calgary, Toronto and Pittsburgh, but the problems are same old/ same old in Gary Bettman Land. Cap gymnastics, TV cord-cutting, market disparities and the collapse off international play, among many. Expect a replay of the GM shuffle this time next year.

Sign up today for Not The Public Broadcaster newsletters. Hot takes/ cool slants on sports and current affairs. Have the latest columns delivered to your mail box. Tell your friends to join, too. Always provocative, always independent.  https://share.hsforms.com/16edbhhC3TTKg6jAaRyP7rActsj5

Bruce Dowbiggin @dowbboy is the editor of Not The Public Broadcaster  A two-time winner of the Gemini Award as Canada’s top television sports broadcaster, he’s a regular contributor to Sirius XM Canada Talks Ch. 167. Inexact Science: The Six Most Compelling Draft Years In NHL History, his new book with his son Evan, was voted the seventh-best professional hockey book of all time by bookauthority.org . His 2004 book Money Players was voted sixth best on the same list, and is available via http://brucedowbigginbooks.ca/book-personalaccount.aspx

BRUCE DOWBIGGIN Award-winning Author and Broadcaster Bruce Dowbiggin's career is unmatched in Canada for its diversity and breadth of experience . He is currently the editor and publisher of Not The Public Broadcaster website and is also a contributor to SiriusXM Canada Talks. His new book Cap In Hand was released in the fall of 2018. Bruce's career has included successful stints in television, radio and print. A two-time winner of the Gemini Award as Canada's top television sports broadcaster for his work with CBC-TV, Mr. Dowbiggin is also the best-selling author of "Money Players" (finalist for the 2004 National Business Book Award) and two new books-- Ice Storm: The Rise and Fall of the Greatest Vancouver Canucks Team Ever for Greystone Press and Grant Fuhr: Portrait of a Champion for Random House. His ground-breaking investigations into the life and times of Alan Eagleson led to his selection as the winner of the Gemini for Canada's top sportscaster in 1993 and again in 1996. This work earned him the reputation as one of Canada's top investigative journalists in any field. He was a featured columnist for the Calgary Herald (1998-2009) and the Globe & Mail (2009-2013) where his incisive style and wit on sports media and business won him many readers.

Follow Author

Bruce Dowbiggin

Celebrity Owners– Fun, Yes, But The Equity Is Even Better

Published on

In case you hadn’t noticed. Celebrity Sports Ownership is all the rage. When the Ottawa Senators were for sale Ryan Reynolds, Snoop and The Weeknd were all mentioned among the bidders (that eventually went to Montreal businessman Michael Andlauer). LeBron James now holds a minority position with Liverpool FC.

Jay-Z owns part of the Brooklyn Nets, Usher a piece of the Cleveland Cavaliers while Fergie of Black Eyed Peas fame also partly owns the Miami Dolphins. Gloria and Emilio Estefan, Marc Anthony, and tennis superstars Serena and Venus Williams are owners of pro sports teams. Famously, Elton John owned Watford FC, although he’s now just an honorary chairman.

And, of course, Reynolds and Rob McElhenney used a documentary TV series that showed their Welsh Wrexham soccer team promoted to the FA’s League Two. What’s the attraction?

Clearly a little PR is always a good thing. But sports team ownership has also become a lucrative equity play. As BMO reports, “The average compound annual growth rate since the last purchase price…  is 15 percent, a meaningful outperformance to the TSX and S&P.  Forbes estimates the Toronto Blue Jays are currently worth US$2.1 billion or roughly C$2.85 billion.

Based on recent sports franchise transactions, expansion fees and annual estimations of franchise values by Forbes Magazine, an $8 billion enterprise value is easily defendable for the Jays’ owners MLSE (who also own the Maple Leafs, Toronto FC and Argonauts).”

It’s the same across the major pro sports leagues. The estimated average franchise value in the NFL since 2013 is $5.1B with a compound annual growth rate (CAGR) of 16 percent; in the NBA it is $2.9B with a CAGR of 18 percent. For MLB it is $2.3B with a CAGR of 12 percent; the NHL is $1.0B with a CAGR of 11 percent; while MLS is $0.6B with a CAGR 21%.

But, BMO cautions, owning a sports franchise is considered “an equity investment strategy rather than a cash flow or income play.” In other words, don’t think that ticket sales and hot dogs are going to make you rich. (Although the NHL’s salary cap, which guarantees owners’ profits is a sweet deal.) The key is sports media which is thriving despite the move to cord cutting..

Sports media rights contracts have grown in tandem with franchise valuations. Not to be ignored in the advertising growth and viewer interaction is the bear knowns as legalized sports betting. Betting companies are flooding the airwaves with commercials while bettors tune in to watch how their selections work out. The casinos and online shops have replaced lower-paying traditional advertisers who’ve dropped off.

In Canada, league or team ownership of broadcast properties is still common. For that reason the real value of those broadcast rights is often opaque. (We had some irritated pushback from Rogers and Bell for writing on this tidy arrangement in the mid 2010s, forcing some limited disclosures). Rogers Sportsnet and TSN own (via MLSE) own a stable of teams in MLB, NHL, CFL and MLS. Good luck finding out what they pay themselves for media rights.

It’s more open in the U.S. Since the New York Yankees pioneered the YES network in 2002— sparking multiple imitators in other markets—the move in the U.S. has been away from outright ownerships of regional sports networks. A number of RSNs in the U.S. are either in bankruptcy or nearing it. Digital and network sources are now absorbing these sources. ESPN, via its owner Disney, is looking to find partners for its many broadcast properties as their bottom line in general has suffered.

Still, ESPN’s legacy business generates revenue and operating income of approximately $12.5 billion and $4.0 billion in 2023. It remains to be seen what new model emerges in the U.S. to answer cord cutting and the death of conventional TV. The NFL’s experiment on Monday, having two MNF games compete on separate networks is one experiment.

In Canada’s monopolistic market, “TSN/RDS penetration rates have declined at a quicker pace than ESPN over the past 10 years. ESPN penetration has dropped from 81 percent of U.S. households in 2013 to 56 percent in 2022, while TSN/RDS penetration has decreased from 89% of Canadian households in 2013 to 49 percent in 2022.

In addition, BMO admits that cord cutting is a thing. “SportsNet subscribers have decreased -23 percent to 5.8 million over the same period. Subscriber and advertising revenues are 60 percent and 40 percent of total revenue, respectively. Since 2017, TSN revenues have increased 13 percent. TSN subscribers have decreased -29 percent to ~7.8 million over the same period.”

But! In the last five years, TSN and SN have increased advertising revenues by 13 percent and 15 percent respectively. The same figure for the top five Canadian non-sports channels (collectively) is six percent. Thank you legalized wagering in Ontario. So who wouldn’t want a piece of this action, especially in Canada?

The red flag in this surging equity market comes in the form of smaller Canadian NHL markets. The Senators sale for $950 suggests a healthy interest in owning, but the Sens sale was also tied into the new LeBreton Flats arena. Ownership or control of a Canadian arena means more than NHL games. It also includes revenue from concerts, rallies, monster-truck events etc.

Even with that can Andlauer produce a winner just two hours from the Montreal Canadiens market? Likewise, the Winnipeg Jets are desperately in need of a larger arena to replace the 15,321 Canada Life Centre. Having Canada’s richest man, David Thomson, as an owner is no guarantee of getting one. And should Thomson tire of being the saviour of a losing Jets hockey property, who in that market has C$1-2B lying around needed to fund the franchise properly?

Likewise, the Calgary Flames. Despite the political press conference this summer about as new agreement the arena that management promised by 2013 has still not seen a shovelful of dirt turned over. The latest gaffe was architect’s drawings for the rink being rejected by the NHL due to inadequate dressing-room space. Start again.

Should the rink not be available till 2025-26 will an evolving ownership group still be interested in shelling out the money to keep the Flames (and Stampeders, Roughnecks and Hitmen) operating in Calgary? And if they don’t, because losing sucks? While energy-rich Calgary has plenty of billionaires, few will want to risk the money needed to keep a competitive team in a small market.

Connor McDavid’s brilliance plasters over the same small-market crack in Edmonton. Yes, they have their new building, but can owner Darryl Katz fund the moves need to keep his stars and build a winner? Vancouver, owned by the Aqulini family, has a larger market base, but with Seattle Kraken just two hours away can they too write the cheques needed to create the first Stanley Cup winner since the Canucks entered the NHL in 1970.

If these Canadian markets do survive longterm it might have to be with foreign ownership. Certainly there is money to be made riding the equity train. But there also no guarantees that those carpetbagger owners might replicate the Montreal Expos and scoot to richer markets.

Sign up today for Not The Public Broadcaster newsletters. Hot takes/ cool slants on sports and current affairs. Have the latest columns delivered to your mail box. Tell your friends to join, too. Always provocative, always independent.  https://share.hsforms.com/16edbhhC3TTKg6jAaRyP7rActsj5


Bruce Dowbiggin @dowbboy is the editor of Not The Public Broadcaster  A two-time winner of the Gemini Award as Canada’s top television sports broadcaster, he’s a regular contributor to Sirius XM Canada Talks Ch. 167. Inexact Science: The Six Most Compelling Draft Years In NHL History, his new book with his son Evan, was voted the seventh-best professional hockey book of all time by bookauthority.org . His 2004 book Money Players was voted sixth best on the same list, and is available via http://brucedowbigginbooks.ca/book-personalaccount.aspx

Continue Reading

Bruce Dowbiggin

If You Don’t Hear From Me, It’s Because I Don’t Hear From You.

Published on

In his memoir, former BMO CEO Tony Comper recalled the press conference to announce a merger between two Japanese automobile corporations. Everything was going swimmingly until someone at the presser asked how long would it be before the two corporate cultures fully merged?

One of the CEOs replied without hesitation. “Forty-three years.”

Forty-three years? Why forty-three years? he was asked.

“Because that’s how long it will be until the executives who made this deal are all dead.”

Yes, there are stubborn business cultures. But there are also political cultures that persist against all efforts to convince them they are deluded. People find it hard to change their ways— particularly when they’ve defended them publicly for years. The New Left’s ironclad resistance to reason and debate is a feature, not a glitch. How to reach them in a friendly, inclusive manner?

Good luck. The Right’s challenge is thinking these people will respond to shame or being corrected. Can’t be done. Won’t be done. They’re like Japanese soldiers fighting WW II on a deserted island 25 years after armistice. They’ll die repeating the Donald Trump Bleach meme to themselves.

Marines help a Japanese soldier from a dugout on Tinian Island during the Fall of Tinian in World War II. He holds a cigarette the Leathernecks used to coax him out. (Photo by © CORBIS/Corbis via Getty Images)

This Gallup poll sheds light on how American (and Canadian) cultures can be blissfully unaware of some huge stories and obsessed by other narratives that fit their mindset. It shows that from 1972-2022 that GOP trust of media has plummeted from 41 percent to under 10 percent, while independents have gone from 53 percent to under 36 percent trust. IOW, their former favourite news sources don’t jive with their everyday reality.

But Democrats in the poll have vaulted from 64 percent to 76 percent in trust of media. Why? One reason probably lies with being told the narratives that please them. That give them comfort. These consumers allow legacy media’s fact checkers to sort out what they should know from “disinformation” without getting their hands dirty with the original story.

How pervasive was the scrubbing? The recent Missouri v. Biden recognized that federal government officials had been interfering with social media companies that digressed from the “accepted” line. An appeals court ordered them to stop. In another case, FBI was bribing reporters and scientists to change their opinions on the origin of the Covid-19 virus, sanitizing stories before they are doled out to the Woke.

“The Science” is supposed to be an ongoing vigorous debate with few settled laws. Yet, most cult scientists refuse debate, preferring to dismiss opponents as conspiracy nuts or— as they did with vaccines— dangers to society. When Al Gore allows himself to be cornered by questions, he rolls his eyes, sighs theatrically and asks his followers how anyone could deny The Science.

Gore’s climate apocalypse culture has morphed within a generation from the few fighting pollution to a global dogma of CO2 poisoning nature . Attempts to talk sense on carbon emission obsession, plastics prohibitions, aversion to the nuclear option, Greta Thunberg beatification have all proven futile in the face of an End Oil Now cult that makes Scientology look like the Boy Scouts.

It was the same for the #RussiaHoax, #FinePeopleHoax, #BleachHoax and now Hillary Clinton’s “real war on truth, facts, and reason”. These liberal road-tested canards persists to this day. Here’s Biden on a rare cogent day this summer repeating the #FinePeople hoax that has been debunked years before. Even the Washington Post has had enough, listing Biden’s Top 100 fabulist claims since becoming POTUS.

The latest cult cleansing is Biden’s patently false denial of any contact with son Hunter Biden’s Shakedown scheme. The denial is awarded first position beside #climateemergency on search engines and nightly newscasts. Famously, 51 former security directors and officials claimed, without evidence, that Hunter’s infamous laptop was Russian disinformation. Case closed, said MSNBC. No wonder so many consumers of legacy media in this echo chamber can blithely claim there is no substance to any of the Hunter stories documented by the competition and chronicled on his own hard drive.

The Canadian equivalent of denial culture came with the magic “cure-all” vaccines. Rather than publicly confront the Truckers Convoy on their refusal to take Covid-19 vaccines (which are now accepted as being flawed ), Trudeau hid in the Rideau Cottage calling truckers “an insult to science”. To make sure they never got a chance to question him he sent the cops after them, arrested them, suspended their civil liberties and finances and subjected them to show trials.

And he was supported by the purchased Canadian media who vilified the protesters— for lack of armed insurrection or rioting— for staying too long in their protest. Many promoted false stories of arson and foreign financing of the convoy. This media Trudeau then tried to reward with Bill C-18— designed to make Meta, Google and other large tech sources pay to prop up failing Canadian media. In response, Meta has blocked all news links in Canada and cancelled existing deals with Canadian news outlets. The blocked links cover both Canadian and foreign news in light of Bill C-18.

And the same newspaper lobby that largely gave him a free pass on declaring a national emergency now wants the $595 million “temporary” bailout to be extended with double the subsidies (seeking government tax credits equal to 35% of labour costs.) The bailout meant to aid transition to digital is now instead a Trudeau lifeline in the Toronto Star’s bankruptcy. In the meantime, writes Michael Geist, “investment in the publishing sector has ground to a halt, Canadians have lost access to news on social media, and small and independent media are particularly hard hit. Avoiding the Canadian outcome is a now a top policy priority in other countries looking at media legislation.”

All this as the federal government prepares an online hate speech law— hate to be defined by themselves.
Many are just hoping that a Liberal loss in the next election will cease the encircling madness. That sanity will prevail. But the Japanese car manufacturers are telling us not to get our hopes too high. Trudeau Nation is quite prepared to got to its grave before ever admitting its copious mistakes.

Sign up today for Not The Public Broadcaster newsletters. Hot takes/ cool slants on sports and current affairs. Have the latest columns delivered to your mail box. Tell your friends to join, too. Always provocative, always independent.  https://share.hsforms.com/16edbhhC3TTKg6jAaRyP7rActsj5


Bruce Dowbiggin @dowbboy is the editor of Not The Public Broadcaster  A two-time winner of the Gemini Award as Canada’s top television sports broadcaster, he’s a regular contributor to Sirius XM Canada Talks Ch. 167. Inexact Science: The Six Most Compelling Draft Years In NHL History, his new book with his son Evan, was voted the seventh-best professional hockey book of all time by bookauthority.org . His 2004 book Money Players was voted sixth best on the same list, and is available via http://brucedowbigginbooks.ca/book-personalaccount.aspx

Continue Reading

Trending

X