Thursday, October 05, 2006

My Thoughts on Balsille and the Penguins

Good Day, Eh;

The news of the day is that a gentleman named Jim Balsille has signed an agreement to purchase the Pittsburgh Penguins.


He's kind of a big of RIM (the "Blackberry" company). He appears to be a sharp cookie who knows the ins and outs of the business world. But, what does this mean for hockey?

(5) One more NHL team has a committed ownership group - This will make it easier for the league to synchronize its operations between teams, establishing efficient and effective general procedures across core business departments. Furthermore, it ensures that one more team will compete every single year -- it's only a matter of time until we go into an NHL season with all 30 teams reasonably expected to win the Stanley Cup. This will be great for hockey fans, and it will put the NHL and its players well in the green$$$.

(4) More Hockey in Canada? Rumor has it that, although Balsille has stated that he is committed to keeping the team in Pittsburgh, he intends to fight the NHL's rules. According to TSN's Bob McKenzie, Balsille has an exclusivity clause on Copps Coliseum and has been acquiring legal opinions regarding the validity of the territorial rights imposed by the NHL - which currently prohibit a team in Hamilton. In English, this basically means that he may be building an arsenal for legal battle to bring the Penguins to Hamilton. If Hamilton doesn't work out -- would he look elsewhere? Kitchener has been a rumor, Winnipeg is always an option (given their pretty sweet new rink), and Kansas City has been mentioned too. That said, the NHL has an obligation to all 30 teams and appears to want the team in Pittsburgh - but, if anything, Balsille can leverage against cities until he gets the best arena deal possible...and then make a decision.

(3) Hockey in Vegas? No. A friend of mine suggested that maybe Balsille wants to move the team to Vegas, and I say no - and this is my opportunity to give a quick argument. Vegas is a bad idea for professional sports. There are too many competitive entertainment products. Also, sports in Vegas create susceptibility to and a reasonable apprehension of illegal activity - no other "big 4" sport has a team in Vegas, and I don't see hockey taking the risk. Many experts consider "uncertainty of outcome" to be the key driver of value in professional sports - and Vegas has the potential to undermine confidence in "uncertainty of outcome".

(2) International Savvy -
Many are looking at the potential benefits that could result from the globalization of hockey. With Balsille on board, the NHL has one more owner who has had success on an international scale - North America, Europe, Asia. Balsille and his team will no doubt be a valuable asset in establishing how the NHL can grow its brand and revenues on an international scale.

(1) The Penguins Are Going to ROCK!! The Penguins are going to have a phenomenal team very soon. Probably not this year, but they should be a contender within 3 years. I don't think I have to list the core of tremendous young players that they have accumulated; but, with a stable ownership group, the team will have some money to spend in the next offseason. Balsille should be able to go out next season and sign some big-name Free Agents to fill in the gaps on his roster. Furthermore, he will be able to build the organization the way he wants -- and lets not forget that this guy has already built a phenomenal organization (RIM).

I don't have a Blackberry - I have a Moto Q...but, I call it a Blackberry....(sue me...or the person responsible for this confusion - re: Xerox, Google, Rollerblade...)

Kudos to Balsille for beating the ego of Mark Cuban. The Penguins' future is bright!



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