The National Hockey League celebrated its 96th birthday Tuesday with a $5.2 billion present.
That’s how much Rogers Communications will pay the league in a massive 12-year media rights deal that includes national rights to all of its games across all of the media company’s platforms and services, in all languages.
It is a monster deal that significantly reshapes the sports broadcasting landscape in Canada, and goes some way towards realizing outgoing Rogers CEO Nadir Mohamed’s stated objective of transforming the company into a sports powerhouse.
In a press conference at Rogers’ headquarters in Toronto, NHL commissioner Gary Bettman called the deal “historic and forward-looking,” and called it a partnership that will help grow the game and build and promote the NHL brand and its players.
Bettman declined to talk about the specifics of the negotiations, but did say there was “a lot of interest” in rights from broadcasters. The deal came together very quickly, he said.
The deal gives Rogers the national rights to every game involving a Canadian NHL team in the exclusive windows of Wednesday, Saturday and Sunday, with no blackouts or regionalization. All games on Saturday will be carried across Canada, with extensive pre- and post-game coverage.
The deal significantly strengthen Rogers’ existing NHL portfolio, which includes the regional broadcast rights for the Vancouver Canucks, Calgary Flames, Edmonton Oilers and Ottawa Senators.
“Hockey – and all sports – is in [Rogers’] blood and we are completely comfortable and confident putting our game in their hands,” said Bettman.
A sub-licensing agreement with the CBC also keeps the iconic Hockey Night in Canada brand with the public broadcaster for at least the next four years, although the brand will also live across all Rogers channels and platforms, including City and Sportsnet. While the CBC pays nothing for broadcast rights, it does not collect any advertising revenues from the property.
“We think the ability to have HNIC on Saturday is something that’s important to us; it’s something that not only did Rogers, but the NHL, recognize,” said CBC Radio Canada president and CEO Hubert Lacroix at the press conference. He said the primary benefit of keeping HNIC on CBC is the ability to promote its programs throughout the broadcast.
Lacroix’s brave face aside, the deal is a major blow to the CBC, which has carried HNIC on radio and television since 1952. In an internal memo to staff, Lacroix said the deal will result in job losses, but that the impact would have been much greater if it had lost hockey entirely.
Lacroix said that the NHL set “very high financial expectations” that the public broadcaster could not meet. “While we thought we brought something very special to broadcasting, CBC was not, candidly, in a position to spend taxpayers’ money in this high-stakes game,” he said.
It’s believed the CBC was paying just over $100 million a year in its most recent deal with the NHL and, according to The Globe and Mail, generated about $175 million in annual ad revenue from its hockey broadcasts. The new deal will average out to more than $433 million per season, albeit for a much larger package of broadcast rights than what CBC had.
Lacroix suggested that partnerships like the one with Rogers would be the way forward for the CBC. “In this modern era, CBC needs to… protect and promote its public service mandate through just this kind of partnership, where we can put our public broadcasting assets to work in a smart, fiscally responsible way,” he said.
Rogers Media president Keith Pelley was non-committal when asked what the deal would mean for CBC personalities like Don Cherry. “This is day one of a 12-year partnership, but it is a partnership both with the NHL and with CBC, so over the next months and years we will evaluate all facets of our production and programming,” he said. “At this particular time, we are celebrating the rights we have acquired and not really [thinking] about much more than that.”
It is a similarly huge loss for Bell Media’s sports specialty service TSN, whose current broadcast deal with the NHL is set to expire at the end of next year.
“TSN did a terrific job carrying hockey, we have nothing but goodwill for the people at TSN,” said Bettman. “It’s always tough to lose a partner in a property, but as we looked forward we concluded that for the rights we had, the rights that Rogers was seeking, this relationship made the most sense and we were the most comfortable with.”
With the CBC picking up Olympic rights for the 2014 and 2016 Olympics, TSN finds itself in an unusual position. “How TSN could lose both the Olympics and the NHL in 18 months is breathtaking,” said one Canadian media veteran who asked not to be identified. “TSN can no longer call themselves Canada’s Sports Leaders.”
Quebecor Media’s two-and-a-half-year-old sports service, TVA Sports, also becomes the official French-language broadcast partner for the NHL, airing a minimum of 22 Montreal Canadiens games a year, beginning with the 2014-15 season. The service will also air all playoff games – including those involving the Montreal Canadiens – and the Stanley Cup finals.
Admitting he was running on adrenaline, Pelley, who was previously president of TSN, called it a “transformational day” for the broadcast industry and Rogers Communications, and a game changer for how Canadians access NHL content.
While declining to provide specifics regarding advertising sales, Pelley said that Rogers would adopt a sales model similar to that employed by the Olympic Broadcast Media Consortium in 2010 and 2012, selling all available advertising inventory across multiple platforms. It was an approach that led to revenues for the 2010 Vancouver Games that were four times higher than any previous Olympics, he said.
“You can bet that over the coming months there will be a lot of boardrooms filled with strategic ways of how we can look at all of the rights and both bring the coverage to more Canadians and generate revenue for our shareholders,” he said.
Rogers’ soon-to-depart CEO Mohamed called it an “incredible day” for hockey in Canada, and also called the deal a “game changer” for sports broadcasting. Mohamed recalled watching Hockey Night in Canada with his father and sister after arriving in Canada in the early 1970s, and called them some of his best memories from his youth.
“Hockey brings us closer together as a family [and] as a country,” he said. “It’s our religion. This is the content that matters.
“Today’s deal builds on our incredible sports legacy and solidifies our position as Canada’s number one sports destination,” said Mohamed. “Sports content is a strategic pillar for Rogers, and NHL hockey is the Holy Grail. Two years ago, I said we wanted Sportsnet to be the number one sports media brand in Canada. Today we’re positioned to do just that.”
Disclosure: Marketing and MarketingMag.ca are owned by Rogers
