CATTLE CROSSING

Lowetide
September 23 2012 07:50AM

Back when the NHL played in arenas across North America, we could talk about games and statistics and trades and things. Nowadays, the subject involves lockouts and buildings, and "hockey" talk has given way to business and empre building. This week, a couple of missteps at least gave us something else to discuss.

This is one of my favorite books. In it, Jimmy Devellano painstakingly details the errors he made while representing the Detroit Red Wings as General Manager. He also reveals how Mike Illitch--the owner--at some point decided to move Jimmy D as far from the levers of power as possible. He FURTHER explains how Illitch did it, without ever giving the reader the impression that he--Devellano--saw it happening to him, then or now. Devellano and Illitch formed a relationship and stuck by it, and succeeded the moment Illitch started bringing people in to handle things like procurement and coaching decisions.

Devellano is a delight for fans, because--at 69--he's reached a point in his life where 'filter' is a part of his car. Jimmy D says what he thinks, and this week he lightened the Illitch pocketbook with two grand quotes. Lets take them one at a time.

  • Jimmy D:“The owners can basically be viewed as the ranch, and the players, and me included, are the cattle. The owners own the ranch and allow the players to eat there. That’s the way it’s always been, and that(’s) the way it will be forever. And the owners simply aren’t going to let a union push them around. It’s not going to happen.”

The great thing about Devellano here is that you know he isn't being a sinister dick, he's just stating the facts as he sees them. It's a wonderful look into the 30-man gentlemen's club that is NHL ownership and their entourages. It is also a major tell about where this season is headed--down the toilet. The NHL owners know that the NHL players have no desire to lose a season and are acting in kind. In a negotiation, indifference to the outcome is the gold standard for positioning. NHL owners have reached that point and may have talked themselves into another lost season with little input from the players. Hey, who's to know what 30 quirky rich guys can come up with in 7 years?

  • Jimmy D: “There is a hard cap in place as we all know. You can’t go over that .... period. If Weber gets this much, then another player gets less. Now does that mean it’s right for another team to do that? My answer is this: They (the Flyers) operated within the CBA and it’s totally legit to do. Having said that, I will tell you there is an unwritten rule that you don’t do that, but they did, and just like everything else in life, some people are great to deal with, some aren’t.

This is Devellano discussing the Weber deal and he's probably a little sour grapes on the entire summer (his ranch didn't get Suter or Weber, meaning a bad winter for all the cattle). The problem is that he's made public what everyone knew but couldn't prove--NHL teams don't use offer sheets because of a gentlemen's agreement. Now, I'm not smart enough to get that quote and build a thread from it to collusion, but you know who is? Donald Fehr.

Anyway, Jimmy Devellano is more entertaining that the owners and God love him for running his mouth this week.

MEANWHILE BACK AT THE RANCH

The Edmonton Oilers official twitter had this up last night:

I know it's just a retweet, and I've generally stayed out of this debate, but "loss of nhl club" on their timeline is a bad idea from here. Old timers like myself know all about being threatened, and there's some sensitivity at this point in time. I don't believe for a second the Oilers are leaving town and don't think Daryl Katz is manning the retweet button on a Saturday night,

Still,  I think the Oilers would be wise to avoid doing this for the near future. Just my two cents.

WHAT DOES IT ALL MEAN?

The NHL is forcing us to find our own entertainment. Quick--can you think of anything?

C2a6955161684b5e3189319acfa5ebe4
Lowetide has been one of the Oilogosphere's shining lights for over a century. You can check him out here at OilersNation and at lowetide.ca. He is also the host of Lowdown with Lowetide weekday mornings 10-noon on Team 1260.
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#1 pelhem grenville
September 23 2012, 07:58AM
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...i'm gonna start to juggle again

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#2 mgran
September 23 2012, 08:15AM
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The Rebels are playing the Oil Kings today at 2pm. Let's talk about that.

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#3 Archaeologuy
September 23 2012, 08:16AM
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I might be in the minority, but the Ranch/Cattle comment doesn't bug me in the least. He's right. Those 30 rich guys own the show, not the performers.

Now the Twitter thing, that does bug me. It's like the Oilers refuse to acknowledge that they need the public to support them. Has nobody told these guys that if they want public funding they need THE PUBLIC behind them? To think of all the good will they p*ssed away recently is maddening. They even had the mayor of the city rooting for them at one point and its devolved into threats.

They ought to fire the dummy who made the tweet and the dummy that let it happen. The Oiler twitter feed has always been uninteresting, but things just got stupid.

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#4 michael
September 23 2012, 08:20AM
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Switched over to Shaw this week just so I can watch more Oil Kings games. Shaw telecasts some of the games. I don't know how many yet but it was one more than Telus had on this week.JD remarks are true. An we the fans are the fodder. We feed the "cattle" that live on the ranch, Without the fodder there are no cattle, and there is no ranch. We line up faithfully at the local hockey shrines and faithfully pay our hard earned dollars watching a boys game.We are so clannish in our devotion to our teams that we live and die with every win and loss. The players are set apart and receive our adoration and genuflection. I am like most, guilty of all these sins and would willingly throw even more dollars into the coffers if asked to buy the owners and players just to receive my fix of hockey spirituality.I am sick. At 47 I have worshiped at Hockey shrine for well onto 40 years. I am addicted to hockey that in no way can measured or quantified. Its part of my fabric of being. The"Ranchers" prey upon men and women like me to continuously fill their coffers. And we willingly do so. We can't help ourselves. JD shouldn't be fined. He should be applauded for telling the truth. In Detroit they call it "Hockeytown". In Edmonton we call it "Oil Country". Whatever you call it it equals money. Until the "fodder" stops coming to the "Ranch" to feed the "cattle" we'll all just have to make do with WHL and AJHL and AHl to feed our hockey lovin souls.

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#6 Archaeologuy
September 23 2012, 08:31AM
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@Lowetide

Well I hope they at least fire the training staff ;)

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#8 Bhussey
September 23 2012, 08:51AM
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The team won't move but there some possibilities. Katz sells team. Katz keeps team at Rexall and Oilers become a cap floor team.

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#10 Spartacus
September 23 2012, 09:07AM
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Ya, Katz is subtle in his negotiating tactics. A lot like this guy...

http://www.youtube.com/watch?v=jsW9MlYu31g&feature=related

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#11 MattL
September 23 2012, 09:11AM
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I think one of the most galling things is how Katz keeps claiming he WON'T negotiate through the media. He's always negotiated through radio/media mouthpieces (even when he was negotiating to buy the team in the first place.) It's like Charles Manson saying he doesn't have to kill people, he just thinks it. Sure he doesn't threaten to move the team, he doesn't have to, a half dozen people are lined up to imply it for him.

I'm starting to see why he doesn't speak very often. He might have a good heart and good intentions, but he has a way of turning believers into non-believers.

And I'm someone that really wants a new arena!

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#13 Dawn
September 23 2012, 09:23AM
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Why wouldn't they move? Companies don't have conscience or loyalty on their balance sheets. Especially not NHL franchise owners. Case in point - Lockout 2004, lockout 2012. What the fans want is of no consequence. Were the Jets and Nordiques fans any less rabid than Edmonton ones? Say what you will about Katz. But there is no question he is an astute businessman. And you don't get where he is without a certain amount of ruthlessness. How many excellent offers do you expect him to turn down? Surely he's got wind of a few already.

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#15 Dawn
September 23 2012, 09:37AM
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LT: Why wouldn't he sell if he could sell at a healthy profit?

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#17 Dawn
September 23 2012, 09:48AM
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Sorry. Answered a question with a question. I wasn't talking about him personally moving the team. Just wondering what compelling reason he has to keep it. The only reasons I can imagine would be emotional. And call me cynical, but I doubt he makes too many business decisions based on emotion.

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#18 RexLibris
September 23 2012, 09:53AM
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I recently criticized Jay Feaster for some of the character issues that have arisen in the Flames organization over the past few years. Notably, that tweet mocking the Hemsky signing, as well as a few other public statements that bordered on patronizing and confrontational.

I'm afraid that here is the same issue. Twitter is a phenomenal social media and public relations tool. The media and fans are addicted to it without an organization having to do one second of selling. It comes as a ready-built marketing tool.

So why is it that so often an organization like a sports team allows idiots to man the helm? Wesley Crusher was never allowed to steer the ship, and with good reason.

Perhaps the Oilers staff put in charge of these tools are younger generation workers entering the labour landscape. They might lack some of the discretion that experience and time will offer.

Or maybe the manager meant to oversee social media interactions had a massive brain cramp?

Either way, the Katz Group is not being well-served by their advisers and marketing consultants in this regard.

There is absolutely nothing to be gained by stepping closer to the territory previously held by Peter Pocklington.

I'm an unabashed supporter of building an arena. Make it big, make it beautiful, make it the best arena in the NHL and so fantastic that Calgary will have to wrack it's brains to try and compete.

That being said, statements like this really tick me off and push me towards the stance that the city needs to take the Katz group to task over this.

Katz isn't moving the Oilers. There is no way on this Earth that the NHL would allow a team to leave Edmonton, if only because there are five or ten other American franchise owners who would want to move their clubs first.

Abandoning a Canadian market with a captive fan base would be beyond stupid, which, on second thought, I suppose means that it is something the NHL might consider.

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#19 Eulers
September 23 2012, 09:54AM
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Lowetide wrote:

Arch: I imagine the person who retweeted has been moved to another another job within the organization.

I do agree that the Katz strategy is something of a mystery at this point, but the rt was a hiccup imo.

LT, booted upstairs perhaps? Say to Director of Hockey Operations?

;)

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#20 RexLibris
September 23 2012, 09:54AM
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Lowetide wrote:

Dawn: Why would Katz leave Edmonton--an exceptional NHL market--for a lesser one? Where is the available city that is superior to Edmonton? And don't say Seattle because it isn't a better hockey market.

Fort McMurray?

;-)

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#22 DSF
September 23 2012, 09:56AM
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Lowetide wrote:

Dawn: Why would Katz leave Edmonton--an exceptional NHL market--for a lesser one? Where is the available city that is superior to Edmonton? And don't say Seattle because it isn't a better hockey market.

You're missing the point entirely.

If an arena doesn't get built, Katz won't move the team...he'll sell it.

I would think he'll first offer it to any local buyer foolish enough to think he can make a go of it in Rexall Place for the foreseeable future.

If no local buyer is forthcoming...he'll sell the team.

At that point, Don Levin would but the team and move it to Seattle or Quebecor will buy it and move it to Quebec.

And.

Seattle WITH a new arena IS a better hockey market than Edmonton WITHOUT a new arena.

1) 3000 additional seats

2) Significantly more luxury boxes

3) Much larger corporate presence

4) Much larger television market from Vancouver to Portland

5) Zero investment in new arena.

6) Potential benefit of non-hockey revenue depending on lease terms

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#24 DSF
September 23 2012, 10:16AM
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Lowetide wrote:

Oh, DSF. You're the human rain delay. First of all, I think it is established the city will build a new arena. Second, although I agree Katz may sell the team (it's an option) that doesn't seem to be his end game.

Seattle might end up being an NHL city, but I don't see any evidence that Edmonton will be the victim. The only thing these two items have in common is they are taking place on parallel lines.

Oh, LT, you're such a Pollyana.

If, you're correct that the city will build a new arena (despite not having a deal in place and still missing $100 million) all will be well.

Bettman has been very clear that Edmonton must build a new arena or its game over.

Katz has been very clear he will not play in Rexall Place beyond the end of the lease.

Katz "end game" is obviously to get a new arena built in Edmonton but there are now TWO viable options for re-location.

There is tremendous motivation for the developers to get an NHL team in Seattle since city funding for the arena increases by $80 million if the the developer lands BOTH an NBA and NHL team.

http://sports.yahoo.com/blogs/nhl-puck-daddy/potential-nhl-seattle-owner-talks-relocation-vs-expansion-181402759--nhl.html

$80 million is a lot of coin.

Money talks....you know the rest.

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#25 Jonathan Willis
September 23 2012, 10:17AM
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@ DSF/Lowetide:

You know who else doesn't see Edmonton as the victim of a Seattle team? Don Levin. Levin's publicly stated that he does not expect to land a team via relocation.

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#27 DSF
September 23 2012, 10:30AM
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Jonathan Willis wrote:

@ DSF/Lowetide:

You know who else doesn't see Edmonton as the victim of a Seattle team? Don Levin. Levin's publicly stated that he does not expect to land a team via relocation.

He has to say that Jon to keep in the NHL's goods books.

Bettman doesn't like poachers.

The article I linked to above has some other speculation.

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#28 Butters
September 23 2012, 10:52AM
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Bigger hockey market is a dicey topic. Seattle may be bigger, with a bigger corporate presence, but Seattle has; the Mariners, Seahawks, college football and will likely get an NBA team back. Edmonton may be a bigger hockey market by tradition, and the fact that the Oilers are pretty much the only game in town, save the Eskimos I guess.

Up for debate I guess...

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#29 Canada 72
September 23 2012, 11:34AM
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As a non-Edmontonian who rarely makes it to a live game, I say let them rattle their sabres. Even if a move came to be, with the state of technology I can follow the Seattle Sabre Rattlers just as easily as the Oilers, as long as you keep posting Lowetide. An occasional trip to Seattle in January to take in a game and dodge some flying fish at Pike's would break up the winter nicely. I know we might not all agree on that, but I think we can all be thankful that Raquel was never locked out. That truly would have been tragic. Carry on.

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#30 Morgie99
September 23 2012, 11:54AM
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Spartacus wrote:

Ya, Katz is subtle in his negotiating tactics. A lot like this guy...

http://www.youtube.com/watch?v=jsW9MlYu31g&feature=related

F-ing hilarious!

Thank you :)

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#31 OilLeak
September 23 2012, 12:34PM
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RexLibris wrote:

Fort McMurray?

;-)

You know what? If Fort Mac had 200,000 people instead of the 100,000 or so (with the surrounding areas) the city could support an NHL team. The problem is that no NHL player in thei right mind would come here. Plus the location for an arena and infrastructure surrounding it would also be an issue, but in terms of financial viability it could work.

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#32 David S
September 23 2012, 12:49PM
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What bothers me is people saying "Edmonton is a great hockey market".

While they do sell out every game, the real revenue comes from broadcast rights and corporate support. In that vein, Edmonton is a small market team.

There's far less corporate potential here than in places like Toronto, Vancouver or even (shudder) Calgary. And I've seen TV media buys for other market teams. Edmonton is far cheaper by comparison.

While fans fill the building, corporate suites and TV revenues fill the coffers. Don't dismiss cities like Seattle. They have both in spades.

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#33 TonyT
September 23 2012, 01:08PM
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While I'm not about to slag Daryl Katz, it's interesting how this once heralded saviour to Oilers hockey has evolved into this. Whether you agree or disagree over who should fit the bill, the fact still remains that the Oilers have the 2nd oldest arena in the NHL. Granted city council has been extraordinarily slow to leave a downtown legacy, his PR has left alot to be desired. Lastly, what really has me irked is the constant raise of ticket prices. While I'm not necessarily complaining about the price of tickets (i.e. $65 SRO), the context (3 near last place finishes) makes a ticket price increase (in my opinion) is completely unjustified. Granted, he can get away with it in this market, but what other product on earth can you be of such poor quality and charge near the highest?

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#34 Kaiser Wilhelm
September 23 2012, 01:14PM
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Lowetide wrote:

Dawn: Why would Katz leave Edmonton--an exceptional NHL market--for a lesser one? Where is the available city that is superior to Edmonton? And don't say Seattle because it isn't a better hockey market.

Quebec city is just a ruse; no way Katz would move the team there, since Pierre whats-his-nuts (the Quebecor owner) controlls the arena. However, I believe Markham could be a legitimate option; we already know Ontario hockey fans would cheer for the Washington Generals if they had Leafs jersies on (oh, wait. . . they do), and you don't think ONT. fans wouldn't be over the mooon to get a team with the nucleus we have?

I think the relocation talk is a bit of a smokeshow too, but I also think we shouldn't be so arrogant as to think we're safe no matter what.

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#36 DSF
September 23 2012, 01:55PM
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Lowetide wrote:

If Katz moves to Markham, he'll be paying a massive fee for the market, right?

And he would make it back in spades.

The TV revenue alone in that market would dwarf anything Edmonton could offer never mind the corporate sponsorships, bigger arena and merchandise sales in a huge market.

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#37 Butters
September 23 2012, 01:56PM
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I think DSF is right. No arena, no Oilers. Katz will sell the team to either Seattle or Quebec City. Heck, he might be able to get a bidding war going between the two.

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#38 common sense
September 23 2012, 03:05PM
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David S wrote:

What bothers me is people saying "Edmonton is a great hockey market".

While they do sell out every game, the real revenue comes from broadcast rights and corporate support. In that vein, Edmonton is a small market team.

There's far less corporate potential here than in places like Toronto, Vancouver or even (shudder) Calgary. And I've seen TV media buys for other market teams. Edmonton is far cheaper by comparison.

While fans fill the building, corporate suites and TV revenues fill the coffers. Don't dismiss cities like Seattle. They have both in spades.

The NHL is a second tier sports league. The Edmonton Oilers according to Forbes is in the top 5 teams wrt net operating income of 17.3 million. Only Toronto, New York Rangers, Montreal, Vancouver generate more EBITA. Also the Edmonton Oilers are in the top 15 wrt current estimated value. So in summary the Edmonton Oilers are doing excellent business in a second or third tier sports league. Katz could move the team and no replacement team could come in but more probably there would be another team come in. http://www.forbes.com/nhl-valuations/list/

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#39 David S
September 23 2012, 03:17PM
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If it came down to it I'm becoming more of the mind Katz would sell the team rather than relocate. $17 Million before tax considerations is not nearly enough to get excited about for a guy like Katz if owning the team causes as much grief as it seems to be doing.

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#40 common sense
September 23 2012, 03:23PM
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David S wrote:

If it came down to it I'm becoming more of the mind Katz would sell the team rather than relocate. $17 Million before tax considerations is not nearly enough to get excited about for a guy like Katz if owning the team causes as much grief as it seems to be doing.

Yeah, its not that much to a billonaire. But that 17 million EBITA is top 5 in the entire league. Don't underestimate Edmonton as an NHL hockey market. There aren't that many destinations better than Edmonton as far as the NHL is concerned and a lot of that has to do with the fact that there really are limited hockey markets in the USA.

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#41 DieHard
September 23 2012, 03:36PM
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@common sense

"there would be another team come in"

And who would own it and where would they play?

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#42 DSF
September 23 2012, 03:38PM
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common sense wrote:

Yeah, its not that much to a billonaire. But that 17 million EBITA is top 5 in the entire league. Don't underestimate Edmonton as an NHL hockey market. There aren't that many destinations better than Edmonton as far as the NHL is concerned and a lot of that has to do with the fact that there really are limited hockey markets in the USA.

Forbes numbers are almost fantasy.

They have no access to NHL books.

Do you actually believe the Oilers are in the same league as Toronto, Montreal, NYR, Boston, Vancouver, Calgary, Philly and Chicago?

The Forbes numbers, for example, show the Flames with revenue of 105 million and operating income of only $1.1 million.

That compares to the Oilers revenue of 96 million but operating income of 17.3 million.

How do you account for the difference?

Also, bear in mind, the Oilers are the only team in the the league that does not receive non-hockey revenue from the arena.

Changes the picture drastically.

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#43 Butters
September 23 2012, 03:50PM
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How about this... Instead of 2 million per to the Oilers how about 2 million per to Northlands to stay out of the big concert market. Lady Ga Ga goes to RX2, Roxette to RX1.

Everybody loves Northlands for some reason so maybe this might more palatable.

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#44 RexLibris
September 23 2012, 03:56PM
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@OilLeak

Yeah, the jab wasn't at the size of the place, but rather the infrastructure and environment.

You know what would be fun? Draggin Ilya Bryzgalov's butt up there two or three times a year for a road game. You want to complain about Edmonton? Here you go, my friend.

The first person to get a WHL or even AHL team to that city will have a mint in their own basement. The place is crying out for some social venues.

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#45 Hair bag
September 23 2012, 04:27PM
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Lowetide wrote:

Dawn: Why would Katz leave Edmonton--an exceptional NHL market--for a lesser one? Where is the available city that is superior to Edmonton? And don't say Seattle because it isn't a better hockey market.

Lowetide, now you're the one being naive...Quebec, Markam just to name two! Both are just as strong Canadian markets as Edmonton that are in the process of building new rinks. I am not saying the Oilers are going to move but you're a fool if you think Katz doesn't have other options.... I certainly hope that this game of economics on who's going to pay what doesn't lead to him exploring those avenues but the possibility is there even if it is slim.

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#46 Hair bag
September 23 2012, 04:31PM
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DSF wrote:

And he would make it back in spades.

The TV revenue alone in that market would dwarf anything Edmonton could offer never mind the corporate sponsorships, bigger arena and merchandise sales in a huge market.

Totally agree

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#47 Max Powers - Team HME Evans
September 23 2012, 04:36PM
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Can someone please explain to me how the Oilers would be relocated anywhere before Phoenix, Florida or even the Isles would??

It's 100 times more likely a suitable place to play hockey will be built before the Oilers relocating becomes a viable option.

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#48 Digger
September 23 2012, 04:40PM
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Are the Oilers profitable today? Yes.

But that has NEVER been the driving force behind getting a new arena built, has it? It's tomorrow's profit margins. And can anyone honestly say with a straight face that if the Oilers are stuck in one of the smallest, oldest buildings in the NHL as of today, already paying the 4th highest in average ticket prices, throwing games left and right onto PPV to eke out a few extra bucks, and paying out salaries that do nothing but continue to rise, that this team has much of a chance to maintain that?

There isn't a doubt in my mind, and I've been watching this team since their WHA days, that if that lease expires and there's no building on the way to replace it, that the Oilers will be sold and moved...and you're living in denial if you think for a second that the NHL would do a single thing to get in the way.

When I was younger, that possibility would've bothered me greatly. Now, I couldn't care less where they play. They'll still be the Oilers to me no matter what city they're in, and I'll have just as easy a time cheering a team with Hall/Eberle/RNH/Yakupov/Hemsky on it if they're playing in Seattle than Edmonton.

If Edmonton lets this opportunity get past them, good luck getting anybody else to come here and deal with the gong show that is this city. And guaranteed ANY move of another team to here would require that a new building be part of the deal.

It amazes me how some Oiler fans are so smug and complacent about where they rate in the grand scheme of things. "The Oilers would never leave!"? Yeah, keep on believing that.

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#49 Semenko and Troy
September 23 2012, 04:57PM
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If there is no perceived possibility to the Oilers ever leaving, why would the city have insisted upon a 35 year location agreement as part of the arena deal?

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#50 Sliderule
September 23 2012, 05:01PM
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Some of you aces who think Seattle is a great hockey market should come down to Phoenix and go to a game. The corporate boxes are empty.The arena is half full with giveaway seats. There is a huge market in Phoenix and Seattle but it is divided among college football,college basketball ,NFL football and when the arena is built in Seattle NBA basketball. The NHL is not going to let the oilers move anywhere.Seattle if it gets a franchise It will be an expansion team Everybody keeps saying we are a small market.At 1750000 people in northern Alberta we are not a small HOCKEY market. The NHL will back up Katz threats and say it looks bad just like they did in Pittsburgh.In the end Katz will work a deal with the city and the arena will get built. There is just too much money to be made in our city to try to walk away.

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