[News] Update: NHL green lights season-ticket drive for Las Vegas

[Northendzone]

persoanlly i don't think this is a good idea for a bunch of the reasons mentioned above, it will be interesting to see what comes out of this market test......

[Dan02]

Originally Posted by troutman

I would debate that point. There is more talent available to the NHL now than there was in the 1980s. There has been a big influx of European players, and there are now more minor hockey players in the USA than Canada.

Indeed the reason there is so much parity now is the league is the opposite of watered down. Even the worst team in the league has a couple potential super stars.

[Ozy_Flame]

Originally Posted by kunkstyle

And how many of those are strictly during hockey season? What tiny fraction of those 2 million are going to go to a hockey game vs gambling/drinking/golfing/any thing else Vegas related?

Quoting the number of visitors to the city is a pointless argument IMO since there's no data on how many of that number would spend their dollars on hockey.

And using the Canadian market argument they're banking on being profitable based on what, 20% of the home games in the season?

I trot out likely way too many Dragon's Den references, but it's no different when the better mousetrap startup company comes out and says "The mousetrap industry is worth 8 billion dollars annually. If we can capture 1% of that we'll be an 80 million dollar company" Sure. But what makes you think you'll capture anywhere close to that 1%?

By similar logic, the NHL sold 21.6 million tickets last year so that means a team in Maple Creek Saskatchewan shouldn't have any problem selling out.

This is going to be Phoenix 2.0. Won't that be a fun division rivalry to watch. 6 local fans, 1 away fan, and 3000 people in Edmonton/Roughriders jerseys.

I know the numbers I mentioned are not nearly accurate enough to point to success/failure points. However, it paints a picture of the type of fans that attend. Assuming you can get relatively cheap tickets to a game (which will no doubtedly be the case when it competes with other nightly entertainment venues), why would it be a fallacy to assume a group of Calgarians wouldn't buy tickets to a game? Especially if the Flames are playing? It would be interesting to do a poll of outbound Calgary travellers to Vegas and see if they would spend $20-30 on a ticket to watch the Flames play down there.

Also, Vegas is a tourist package destination, easily booked on sites like Expedia and Travelocity. You have to consider ticket deals that might be part of vacation packages to entice tourists to go.

I'm also curious to know how much Vegas would get from the Sportsnet/NBC deals with the central-revenue sharing plan. Somewhere in the $7-10 million range? How much would that add to projected revenue?

[Phanuthier]

Originally Posted by Cleveland Steam Whistle

I agree with you that it would have to be proven it works, and some form of demand needs to be there, but again, casino's spend billions of dollars on creating state of the art pool complexes, spas, bringing in huge concert acts, building and housing permenant shows like Garth Brooks, Shania, Elton John, Britney Spears, etc....., investing in state of the art hotel rooms............and they don't want their customers to spend a single second in anyone of those investments. The whole point of these very costly expensive things is to attract and keep as many people on the premisis as possible so they spend more money on the floor. And it's a business model that works.

Agreed that incorporating hockey into that is definitely a question mark, but to be honest the business economics at least on the cost side of things certainly don't make you blink your eye when you compare it to some of the other things they do (on-going concerts and such). It will be a wait and see on whether hockey can create the interest and desired reaction from their patrons to make it worth while, but at least you can see the business model / environment that could make it work because they do this type of crap all the time.

I don't, because I'm not sure if I can see a successful business model where they are banking on the success of this thing being on "comps" .... I'm not sure the NHL is "unique" enough the way their vegas shows are, and the cost of this venture is substantially higher than other trail run shows ... we will see though, maybe this STH drive will prove or disprove that thought.

[sureLoss]

Craig Custance @CraigCustance
According to one owner, expansion fee being "thrown around" is $500 million.

That would be $16.7 mil per owner.

[Jay Random]

Originally Posted by Locke

Thats not necessarily true...

Many large companies purchase businesses that take losses so as to apply those losses against gains accrued by their much more profitable and thus more highly taxed, primary businesses.

Yes, but I thought we were discussing a situation in which MGM (as the arena owner) is comping tickets to the games, but someone else owns the actual hockey team. In that case, whatever profit MGM makes from comping tickets will not help the owners of the team.

If the arena owner and the team owner are the same business, of course, then what you say is true. But is there really a casino in Vegas (or group of casinos under one ownership) so large that they can profit from putting 18,000 people on the casino floor all at one time? As I say, scaling is the problem.

[Phanuthier]

Originally Posted by Ozy_Flame

I know the numbers I mentioned are not nearly accurate enough to point to success/failure points. However, it paints a picture of the type of fans that attend. Assuming you can get relatively cheap tickets to a game (which will no doubtedly be the case when it competes with other nightly entertainment venues), why would it be a fallacy to assume a group of Calgarians wouldn't buy tickets to a game? Especially if the Flames are playing? It would be interesting to do a poll of outbound Calgary travellers to Vegas and see if they would spend $20-30 on a ticket to watch the Flames play down there.

Also, Vegas is a tourist package destination, easily booked on sites like Expedia and Travelocity. You have to consider ticket deals that might be part of vacation packages to entice tourists to go.

I'm also curious to know how much Vegas would get from the Sportsnet/NBC deals with the central-revenue sharing plan. Somewhere in the $7-10 million range? How much would that add to projected revenue?

wouldn't we need the tickets to be substantially higher then $20-30 for this to be successful?

and by "group of Calgarians, would we have to be closer to talking about 10k fans or so?

[DownhillGoat]

Originally Posted by Ozy_Flame

I know the numbers I mentioned are not nearly accurate enough to point to success/failure points. ... why would it be a fallacy to assume a group of Calgarians wouldn't buy tickets to a game?

Understood, but IMO relying on tourism is a horrible model for an NHL team as I don't think any numbers will be able to support that.

It's not a fallacy to assume that a group of Calgarians would fly out for a game or go to a game when they're there, but it does not make for a solid business plan.

I hope I'm wrong, but I see nothing but failure for a team in Vegas. Cup contenders or not.

[Phanuthier]

Originally Posted by Cleveland Steam Whistle

Just out of curiosity, as I don't know how any of this works down in Vegas, but is there not a major tax win here for the owners? If a casino owned the team, as many have pointed out, they likely wouldn't be making much money directly off the team (concession etc...). The revenue would all be indirect from driving up more business to their existing businesses.

IF this worked out, and it was successful, would the owners actually be able to report a loss on the hockey club, gaining tax benefits, even though it would be driving up revenue for their other ventures?

i believe so, but aren't they taking a loss enough as it is? says my LVS and MGM stocks

[Cleveland Steam Whistle]

Originally Posted by Phanuthier

I don't, because I'm not sure if I can see a successful business model where they are banking on the success of this thing being on "comps" .... I'm not sure the NHL is "unique" enough the way their vegas shows are, and the cost of this venture is substantially higher than other trail run shows ... we will see though, maybe this STH drive will prove or disprove that thought.

That's totally a fair comment and what this hinges on. Will the non hockey consuming public view it as a novelty act (in a positive way) the way they view some of the other shows down in Vegas? Will the hockey fans of the world (as mentioned by another poster) be enticed to Vegas to go see their favouriate team play or a hockey fan in a non NHL market make Vegas a destination to get their hockey fix, the way that fans of certain artists for example make the trip to Vegas to see them perform.

Totally fair to say you don't think it will have the draw, but that's different than not seeing the business model at play. Yours is the true reason it might not work, versus some of the other comments around not enough local support ect... because I don't think that's what the business model hinges on.

[Cleveland Steam Whistle]

Originally Posted by Phanuthier

wouldn't we need the tickets to be substantially higher then $20-30 for this to be successful?

and by "group of Calgarians, would we have to be closer to talking about 10k fans or so?

No, because the whole point is to get you to go to Vegas to see the game, and then spend all your money gambling instead. In this business model the price of the ticket really becomes irrelevant.

[Jay Random]

Originally Posted by Dan02

Indeed the reason there is so much parity now is the league is the opposite of watered down. Even the worst team in the league has a couple potential super stars.

There is no connection between parity in the league and watering down the product. The league has parity, but not because there is oodles of superstar talent for everyone.

The salary cap makes it impossible for a few rich teams to hog most of the star players. The salary floor makes it impossible for the poor teams to cheap out by hiring no star players at all. So the talent is spread around fairly evenly. This remains true whether the overall level of talent is high or low.

If you doubled the size of the league to 60 teams tomorrow (and voided the existing player contracts), the cap system would still ensure a fair amount of parity. A player like Crosby would command so much money in a 60-team market, the team that eventually signed him would have to fill out most of its roster with scrubs and AHLers. A team that refused to use scrubs or AHLers wouldn’t have enough money to sign any major stars.

[codynw]

This is such a stupid idea. I hate everything about it. This team will not be successful and it'll just be another Coyotes or Panthers type franchise.

[Locke]

Originally Posted by Jay Random

Yes, but I thought we were discussing a situation in which MGM (as the arena owner) is comping tickets to the games, but someone else owns the actual hockey team. In that case, whatever profit MGM makes from comping tickets will not help the owners of the team.

If the arena owner and the team owner are the same business, of course, then what you say is true. But is there really a casino in Vegas (or group of casinos under one ownership) so large that they can profit from putting 18,000 people on the casino floor all at one time? As I say, scaling is the problem.

1) Sorry, I didnt realize that. They might do it anyways, but their take-away would be significantly less.

2) Wynn, Ceaser's Ent., MGM, Sands? I think they're worth north of $10B each.

[_Q_]

Originally Posted by Ozy_Flame

I know the numbers I mentioned are not nearly accurate enough to point to success/failure points. However, it paints a picture of the type of fans that attend. Assuming you can get relatively cheap tickets to a game (which will no doubtedly be the case when it competes with other nightly entertainment venues), why would it be a fallacy to assume a group of Calgarians wouldn't buy tickets to a game? Especially if the Flames are playing? It would be interesting to do a poll of outbound Calgary travellers to Vegas and see if they would spend $20-30 on a ticket to watch the Flames play down there.

Also, Vegas is a tourist package destination, easily booked on sites like Expedia and Travelocity. You have to consider ticket deals that might be part of vacation packages to entice tourists to go.

I'm also curious to know how much Vegas would get from the Sportsnet/NBC deals with the central-revenue sharing plan. Somewhere in the $7-10 million range? How much would that add to projected revenue?

Yeah if I was in Vegas during a Flames game, then I would for sure buy a ticket. But who's going to buy tickets to a Vegas vs Panthers or Coyotes game? Because I sure as hell won't pay good money to watch that game.

[Travis Munroe]

Chalk me up as someone in the stands - I would certainly plan my Vegas trips around the flames schedule and I assume a ton of fans from other teams would do the same.
I assume suite/box sales will be spoken for at the snap of a finger as well as a large portion of regular seats.
I think this team should also get this years first overall pick. McDavid will be a huge draw and the Oilers have to settle for second in a best case scenario.

[Locke]

Originally Posted by Realtor 1

Chalk me up as someone in the stands - I would certainly plan my Vegas trips around the flames schedule and I assume a ton of fans from other teams would do the same.
I assume suite/box sales will be spoken for at the snap of a finger as well as a large portion of regular seats.
I think this team should also get this years first overall pick. McDavid will be a huge draw and the Oilers have to settle for second in a best case scenario.

True, but hell, doesnt even have to be the Flames. If a half-assed decent team is in town and the price is right I'd probably show up and have a few beers.

[Cleveland Steam Whistle]

Originally Posted by Realtor 1

Chalk me up as someone in the stands - I would certainly plan my Vegas trips around the flames schedule and I assume a ton of fans from other teams would do the same.
I assume suite/box sales will be spoken for at the snap of a finger as well as a large portion of regular seats.
I think this team should also get this years first overall pick. McDavid will be a huge draw and the Oilers have to settle for second in a best case scenario.

I know in the past 3 years my group of friends would have done 3 bachelor parties that didn't end up in Vegas, that would have if we could have planned the trips around a Flames road appearance.

There's for sure a market to tap into there, the question as others have raised is if it's big enough.

[Travis Munroe]

Originally Posted by _Q_

Yeah if I was in Vegas during a Flames game, then I would for sure buy a ticket. But who's going to buy tickets to a Vegas vs Panthers or Coyotes game? Because I sure as hell won't pay good money to watch that game.

You won't have to. It will be free to stay at _____ casino's.

You will profit the casino enough over your 3 day stay for them to fully justify free tickets to a panthers game.

I wonder if they could kick up the intermission shows to a whole new level? Get a cirque de solei event at intermissions to add a entertainment factor to non hockey lovers.

[SofaProfessor]

A $500 million expansion fee seems steep, but they'll make it back from Vanek the first time the Wild roll through on a road trip.