Sports

Kudos to the NHL. It’s been a robust week of summer hockey

Tom Mayenknecht: Bulls and bears of this week’s sports business world

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Bulls of the week

It’s been quite the week for the NHL. It began with a Game 7 that drew an average viewership of more than 15 million on both sides of the border (7.55 million in Canada on Rogers Sportsnet, CBC, Citytv and TVA Sports, and 7.7 million on ESPN/ABC in the U.S).

That not only set a broadcast record for Sportsnet, but was also the biggest national audience for a Stanley Cup Final game since the Boston Bruins beat the Vancouver Canucks in Game 7 in 2011 (drawing 8.6 million).

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Also on tap this week: The NHL Awards were on Thursday night and the draft today and tomorrow in Las Vegas, and free-agency on Monday, July 1, making it a robust week of summer hockey.

Bears of the week

For at least 40 of its 60 years in business, Nike (NYSE: NKE) has been a winner on the rise — and a bold and brash one at that.

Founded by Phil Knight and Bill Bowerman in 1964, it was rebranded from Blue Ribbon Sports Inc. to the name of the Greek goddess of victory in 1971.

It all turned on the dime that was its big partnership play with Michael Jordan in 1984. In classic win-win fashion, the launch of the Air Jordan brand made Nike what it is today; an athletic shoe and sports equipment juggernaut that drives more than US$50 billion in revenue per annum, universally recognized simply by its iconic swoosh brand mark.

Yet this 60th anniversary year hasn’t offered much to celebrate, what with a two per cent drop in revenue year-over-year (down to US$12.6 billion in its fiscal fourth quarter). It’s enough to make it a bearish quarter by Nike standards, which over the past 20 years has only shown weaker sales growth in the 2008 financial crisis and the 2020 COVID-19 pandemic.

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Compounding the issue for Nike is that most shoe and apparel companies are on the upswing.

Losing in business terms is also a relatively foreign concept for the NFL, the richest sports league in the world. Yet here it is, on the wrong side of a jury verdict in the class action trial involving the Sunday Ticket TV package.

The jury ruled against the NFL in a judgment of US$4.8 billion, one that will grow to three times that or almost US$15 billion because it violated antitrust law.

The NFL will appeal the size and scope of the judgment but the projected loss of US$450 million per team is historic — as in, it’s never happened before.

The money potentially lost in the rearview mirror is one thing. The real impact of the trial verdict is future facing. It will strike at the very heart of the NFL’s TV model, one that is built upon national media rights only, doesn’t offer regional or local TV deals as are common in the NBA, MLB and NHL, and one that has restricted what fans can buy through Sunday Ticket, most recently through YouTube TV.

The jury agreed with the plaintiffs — 2.4 million individual Sunday Ticket subscribers, and 48,000 sports bars and restaurants in the U.S. — that the NFL had inflated the cost of its packages by essentially limiting choice.

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Rarely is the NFL told what to do, but in this case, pending the appeal process, consumers have successfully pushed back and dented ‘The Shield’ in dramatic fashion.

Tom Mayenknecht is the host of The Sport Market on Sportsnet 650 on Saturdays from 9 a.m. to 1 p.m. The Vancouver-based sport business commentator and principal in Emblematica Brand Builders provides a behind-the-scenes look at the sport business stories that matter most to fans. Follow Mayenknecht at: twitter.com/TheSportMarket.

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