Vancouver Canucks center Mike Santorelli (25) celebrates teammate Vancouver Canucks defenseman Jason Garrison's game winning goal during the overtime period of NHL hockey action against the New Jersey Devils at Rogers Arena in Vancouver, B.C. Tuesday, Oct. 8, 2013. THE CANADIAN PRESS/Jonathan Hayward The Canadian Press
Media conglomerate Rogers Communications has launched a shot across the bow of the broadcasting landscape in a $5.2-billion deal for the right to broadcast NHL games across Canada for the next 12 years.
The deal, announced Tuesday, goes from 2014 to mid-2026, and is groundbreaking in its scope. It's the first time a major North American sport has sold exclusive national broadcast rights to a single entity, Rogers Media president Keith Pelley noted at a press conference Tuesday morning.
Rogers will make an up-front payment of $150 million, and then annual payments starting at $300 million, which will escalate to $500 million in the final year of the deal. According to CRTC data, TSN and RDS only took in a combined total of $541 million in revenue last year.
The deal is more than two times the value of the $2 billion that U.S. broadcaster NBC agreed to pay the NHL for 10 years, starting in 2011.
As part of the deal, Rogers also owns the rights to the Hockey Night in Canada brand, but Rogers has inked a side pact to sublicense those rights to CBC and Quebecor's French-language TVA network.
Among other things, that means there will be two Saturday night hockey games on CBC each week for the next four years, just as there are now. In total, CBC will air 320 hours worth of Hockey Night in Canada content on the main network over that time. Rogers will sell the ad space for that time slot, and keep the revenue. But representatives from both the CBC and Rogers said Tuesday the partnership works for both sides.
"Canadians will have more games, more content and more choice than they've ever had before," Pelley said.
"We have reached out to make sure Canadians will have access the way they have before," Rogers CEO Nadir Mohamed said, in what's likely his last major duty before stepping down as CEO of the company next month. "I believe it’s great for CBC and great for Canadians," Mohamed said.
CBC/Radio-Canada president Hubert Lacroix agreed, saying the deal works for the public broadcaster by allowing the network to continue to promote their programming through Hockey Night in Canada, without having to spend money and take on the risk that comes along with being the exclusive broadcasting partner.
"This is how the public broadcaster sees itself in the future," Lacroix said. "This is how CBC needs to go forward, [with] partnerships."
The deal does mean, however, that the CBC will likely not be the only network to broadcast NHL games on Saturday nights. Rogers now has the broadcasting rights to air hockey games on any of its networks — whether that's on the City channels, or on one of the Rogers Sportsnet channels that comes with more premium cable packages.
For now, "the plan is to have the Stanley Cup final on CBC," Pelley said. "Our goal is to get maximum reach to Canadians."
But if a Canadian team makes the finals, "it wouldn't be out of the question" for Rogers to simulcast the game of some of its other networks, Pelley said. "We would look at that option [but] our plan is to have the finals on CBC."
Bell left out
While partnering with the CBC and TVA, the deal is notable in that it locks out Rogers rival Bell from playing a role in what is likely the most valuable television property in Canada — the national rights to broadcast NHL games.
But that's not to say TSN is completely blocked out of NHL hockey.
"We submitted a bid we believed was valuable for the NHL and appropriate for our business, but were ultimately outbid," Bell Media said in response to a query from CBC News.
While losing its status as a national NHL broadcaster, the network does retain, however, a large slate of regional games, including 10 Toronto Maple Leaf matches next year. The following year, that figure jumps to 26.
TSN also holds the regional broadcasting rights to more than 60 Winnipeg Jet games through 2021, and roughly three quarters of all Montreal Canadiens games. In addition, TSN's French-language network RDS "currently has a deal for Sens [Ottawa Senator] and Habs games which we expect to renegotiate," Bell spokesperson Scott Henderson said.
Among numerous other assets, Bell owns a minority ownership stake in Maple Leaf Sports and Entertainment (MLSE), the company that owns the Leafs, basketball's Raptors and soccer's MLS franchise.
"In hockey, our partnerships with the Leafs, Jets, Canadiens, Sens, and Hockey Canada (including the World Juniors) remain core to our TSN and RDS TV, radio and digital properties," Bell Media's statement reads.
Telecom analyst Dvai Ghose of Canaccord says the deal certainly isn't good news for Bell, but is hardly a fatal blow.
"While this looks like a big loss for Bell Media, it never had these national broadcasts which were historically owned by the CBC," Ghose said. "We would expect Rogers to sell some of these games to Bell to help monetize the fees paid to the NHL."
The deal is far and away the largest of its kind in Canadian history. But Pelley brushed off questions as to whether the broadcaster can make money from the deal, noting that the particulars of the agreement can't be compared to other agreements.
Rogers has paid, by orders of magnitude, more than the NHL's previous broadcast partners have paid for deals. But Pelley says that's not an apples-to-apples comparison because they include digital rights, to stream games and other hockey content across mobile content.
"It’s a deal you can’t compare to any other based on the fact that it’s multiplatform," Pelley said.
For his part, Mohamed says he's very confident the deal represents good value for shareholders' money.
"Does it make sense economically? Categorically, this is positive for shareholders," Mohamed said. "[It's] positive from a net present value perspective [and] we would look at this deal as being accretive right from the get-go."
Reaction on stock markets to the deal was muted, with Rogers shares losing a little over one per cent to trade at $46.20 on the TSX. Bell shares were largely unchanged
Ukraine has said it will launch an investigation into a fatal attack in the east of the country, which has further increased tensions between Kiev and ... More Ukraine has said it will launch an investigation into a fatal attack in the east of the country, which has further increased tensions between Kiev and Moscow.
Date 2 hrs ago, Duration 1:34, Views 23