National Post (Latest Edition) - - FINANCIAL POST - Alek­san­dra Sa­gan

TORONTO• For the first time in more than 40 years, the Stan­ley Cup play­offs may lack a Cana­dian team this sea­son.

That’s not only a ma­jor dis­ap­point­ment to Canada’s de­voted hockey fans — Rogers Me­dia cof­fers could also suf­fer at the hands of the teams’ lack­lus­tre per­for­mances three years af­ter the com­pany made a big in­vest­ment in Cana­dian hockey tal­ent.

In 2013, Rogers Me­dia pur­chased the ex­clu­sive na­tional rights to broad­cast all NHL games for a dozen years in Canada for $ 5.2 bil­lion.

This play­off sea­son, the odds of even one Cana­dian team mak­ing the play­offs are slim. None of the seven teams cur­rently holds a play­off spot in the stand­ings and Win­nipeg, Toronto and Ed­mon­ton are at the very bot­tom of the 30- team l eague. The sea­son ends April 10.

“The bot­tom line is: no Cana­dian t eam in t hese play­offs is not at all good news for Rogers,” Marvin Ry­der, as­sis­tant pro­fes­sor at McMaster Univer­sity’s DeG­roote School of Busi­ness, said in an in­ter­view.

Last year, when five Cana­dian teams com­peted in the first round of play­offs, the com­pany’s gam­ble on hockey paid off. Rat­ings jumped 36 per cent over the 2014 post- sea­son’s ini­tial matchups, when only Mon­treal ad­vanced into the play­offs, ac­cord­ing to Numeris.

But af­ter the se­cond round, no Cana­dian teams re­mained in the quest for the Stan­ley Cup and rat­ings slipped, said Ry­der.

So a loom­ing Cana­dian play­off drought could spell trou­ble for Rogers, he said. The com­pany de­pends on high view­er­ship to be able to sell play­off ad­ver­tis­ing spots for hun­dreds of thou­sands of dol­lars or more. That rev­enue then helps pay for the yearly cost of its NHL broad­cast rights.

Rogers de­clined to com­ment on the prospect of a Canada- free play­off sea­son.

But Ry­der pre­dicts play­off view­er­ship could fall by 25 to 35 per cent this year.

“They’re go­ing to take a mas­sive hit,” said Detlev Zwick, an as­so­ciate pro­fes­sor of mar­ket­ing at York Univer­sity’s Schulich School of Busi­ness. He projects a view­er­ship drop be­tween 30 and 40 per cent — if not more — com­pared to last year.

“Sim­ply, the prod­uct they sold to or they’re go­ing to sell to ad­ver­tis­ers is just not worth as much.”

If sig­nif­i­cantly fewer fans tune in, he said, it’s likely Rogers will of­fer dis­counted ad space, while com­pa­nies t hat have al­ready pur­chased slots may try to re-ne­go­ti­ate the terms of their con­tracts.

It’ s quite pos­si­ble, of course, that Cana­dian hockey fans will still watch the play­offs in sig­nif­i­cant num­bers de­spite the ab­sence of a Cana­dian team.

Rogers could help spur fur­ther in­ter­est in Cana­dian fans by high­light­ing home­grown tal­ent play­ing for U.S. teams, said Ry­der. Canada’s golden boy Sid­ney Crosby, for ex­am­ple, may duke it out in the play­offs with the Pitts­burgh Pen­guins.

But re­gard­less of how the com­pany po­si­tions the post- sea­son, it’s un­likely to repli­cate the rat­ings when Cana­dian teams com­pete for the cup, Ry­der said.

Oth­ers point out that the rights ac­qui­si­tion was hardly a bad in­vest­ment for Rogers. The com­pany is only a few sea­sons into a 12- year deal that’s l ikely to have good per­for­mance over the long- term.

Zwick com­pares Rogers’s in­vest­ment to a port­fo­lio that’s likely to have some bumps over the years, but should lead to a strong profit over­all.

Rogers can also hope that the poor per­for­mance of Cana­dian teams this sea­son will po­si­tion them favourably to make early picks at June’s NHL draft. The teams could beef up their ros­ters and be­come more fierce com­peti­tors next sea­son, said Ry­der.

But if the low Cana­dian dol­lar weak­ens the abil­ity of Cana­dian fran­chises to at­tract top tal­ent, Ry­der added, Rogers could be fac­ing the same prob­lem next year.

“If it be­came a new trend that sud­denly this once-in-40- years is now the new stan­dard ... then I’d be very wor­ried about the rights I’ve ac­quired.”



The Stan­ley Cup play­offs could be with­out a Cana­dian team for the first time in 40 years, some­thing that could af­fect view­er­ship — and ad­ver­tis­ing rev­enue — for

Rogers Me­dia, two univer­sity busi­ness pro­fes­sors be­lieve.

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