NHL Effectively Kills CBC In Mega Deal With Rogers

By TSM

Do you remember this?

It’s one of a few interviews that many insiders are telling me was behind what ultimately led to a phone call from the NHL to the CBC this past Thursday night telling the CBC that they were out of the running for the Canadian national TV deal.

In fact, if you’ve read Richard Peddie’s recent book he suggests that it interviews like this would be the end of a lengthy relationship between the CBC and the NHL.

I am not a total idiot. Rogers offered up a ton of dough. If the money wasn’t there it would have been harder to leave the CBC. However, I am told that Bettman Inc. was very happy to be leaving the likes of the CBC.

Make no mistake, this is the beginning of the end of the CBC. The bulk of their revenue came from hockey related revenue (had to throw that in there). The rest of their revenue is a result of having the hockey revenue in the first place. Yes, the CBC will have games. They are no more than a canvas. Yes, they can promote the games. They get no revenue from the games. They don’t sell the games. They get no benefit except for the fact that their most valuable time slot remains taken. Did you see the example Keith Pelley gave yesterday, where the Leafs would be on Sportsnet or CityTV and the Senators would be on the CBC. With no offense to our friends in Ottawa, that’s not exactly the same national draw as the Maple Leafs.

Tons of people are talking about the effect on Bell and TSN. No doubt this is painful. However, I am told that Bell made a conscious decision NOT to play in this sandbox. Bell has the money to do so if it wanted to do so.

Rogers? There are rumblings this morning that the incoming CEO wasn’t as fully invested in this opportunity as outgoing CEO Nadir was/is. If you take a step back and look at life at Rogers today, they’ve not only doubled down on sports, they’ve 4 down on sports. That’s a BIG bet in one vertical wouldn’t you say?

I’ll do the traditional review of the coverage over the weekend.

My overall take? It’s a great day for hockey fans in Canada. More games on TV is a good thing. The value is in mobile and internet rights. That’s what Rogers is banking on. I think this maimes Bell/TSN, wounds them- not fatally. CBC? They are done. They have sales folks that have NOTHING to sell. This is the beginning of the end of the CBC. I have to wonder just how much Maclean’s interviews had…

More later.

COMMENTS

WORDPRESS: 6
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    Pudge72 6 years ago

    I don’t think the NHL or Ron McLean killed the CBC. I think the CBC is being starved on the vine by a federal government that despises the existance of the organization, despite its value to Canadian culture and identity. Rogers willingness to pony up the $$$ has done in the CBC, since the CBC could not match the valuation put on the HNIC package by the NHL. The valuation would not be so high if Rogers and TSN was not willing to meet it in some form. Additionally, CBC is much more reliant on advertising revenue, I would believe, than Rogers or TSN (who can derive much more value from the actual content than CBC can). I don’t think advert rates were rising at nearly the same rate as the rights fees being asked. If they had kept the HNIC package for themselves, I doubt the CBC would have actually turned a profit on the package anymore.

    The snippet of commentary from the CBC exec that I heard from yesterday’s announcement left me with the impression that this may be the first of several similar partnerships where CBC transfers into ‘canvas’ mode (to borrow your phrase). This would serve to lower operating costs at CBC while still providing the station with CanCon for large blocks of time (i.e. could some Jays games end up on CBC?).

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    With sports rights becoming so expensive, it probably isn’t realistic for a public broadcaster to spend so much to stay in the game.

    Maybe CBC should focus on news and actually developing some compelling comedy and dramas (instead of the bland, mediocre junk they usually produce).

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    Mike V 6 years ago

    CBC was never really in a position to compete with Rogers or Bell for the NHL rights. Some people could point to a years old, tough interview if they want but I think it made no difference.

    Also, the CBC was going to be forever changed by this negotiation no matter what the outcome. Let’s just assume for a moment they did win the bid to keep HNIC and say they had to double the rights fee to do it. CBC is not a public company that could deal with lower profits initially or a cable channel that could extra higher subscription fees. I know some people just look at the channel as hockey, hockey, hockey, but it’s breadth goes much further than that and the executives would have had to slash the budget by $100M somewhere (original programming, local news, radio, online, who knows) to pay the NHL just to keep up with the status quo. That is simply a massive reduction in budget for all non-NHL departments on top of what the government has trimmed in the past few years. It was a damned if you do, damned if you don’t scenario that could be seen comming years ago.

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    Pudge72 6 years ago

    @ Mike V…case in point to your last statment: Just look at the change in the Olympic broadcasting arrangement the last two times. No single entity in Canada can afford the fees so the multiple broadcaster format was brought in (rather successfully, imho).

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