The NHL still believes in the long-term success of the Vegas Golden Knights even with the NFL owners’ Monday decision to approve relocation of the Oakland Raiders to Las Vegas.
“This was always a possibility and that was something the (NHL’s Board of Governors) was aware of at the time they approved the franchise,” NHL deputy commissioner Bill Daly said in an email to Puck Daddy. “We remain confident the Golden Knights will be successful, and that won’t change with or without an NFL franchise in town.”
The Raiders will stay in Oakland for the next two seasons before planning to move to Las Vegas in 2019. The Golden Knights will start play in the 2017-18 season.
Overall, the Golden Knights initially said they saw the eventual Raiders move as a positive.
“I think the first thing is obviously this has been discussed and been a part of kind of our dynamic for months now. It’s not like today has been a big surprise. I think everybody felt positively that this was going to come out the way it did and so from that end I wouldn’t say it’s necessarily a big surprise. It’s just more confirmation of what we thought was already going to happen,” Golden Knights president Kerry Bubolz said in a phone interview with Puck Daddy. “I think the big picture is it’s a new era for major professional sports in this community and it creates a visibility on the market that is a positive. You already have this great marketplace in terms of the entertainment and kind of gaming aspects but now you can throw major professional sports into that and I think again big picture, those are positive things for our franchise.”
But later in the day in an interview with KSHP 1400, owner Bill Foley gave a more combative about the Raiders’ arrival in an interview.
“If I had complete control, I would have rather the Raiders would not have been here. But I didn’t, so welcome. Bring em on,” he said.
Foley also slammed the public financing behind the new stadium for the Raiders.
“I felt like there are a lot better ways to spend $750 million than bringing the Raiders to Las Vegas,” Foley added, “Thought we could spend it on police and schools, and make them the best in the country. Instead I guess we’re getting a football stadium.”
In the past, the NHL has struck a mostly indifferent tone on the Raiders and the possibility of the NFL jumping into the market. The NHL’s Board of Governors approved the expansion of the league into Las Vegas last June making the Golden Knights the first major pro sports team to enter the area. At that time, there were rumors of the Raiders moving to Las Vegas, but there was nothing concrete.
“I would say overall, it’s neutral. We were certainly aware of the talk and the possibility of the NFL locating a franchise in Vegas at the time we made the decision to expand into Las Vegas,” Daly said via email to Puck Daddy last January after it was reported the Raiders would file relocation papers. “So, obviously, we felt an NFL team – if it transpired (and certainly time will tell on that) – wouldn’t materially affect the business of the hockey team. That continues to be our feeling. I think while fan bases undoubtedly overlap, the sports ‘buy’ for sponsors is materially different as between football and hockey.”
Still, there are some questions on whether the NHL should be concerned about the Raiders and whether they’ll slow some of the Golden Knights’ momentum with fans and local sponsors. The NHL has seen this happen before with the NFL when the Nashville Predators and Tennessee Titans entered Middle Tennessee in 1998.
“Initially the NHL’s Nashville Predators surprisingly held their own against the NFL’s Tennessee Titans, but it soon became apparent that the novelty of hockey in a non-traditional sun-belt hockey market was risky business,” Vanderbilt economics professor John Vrooman said. “Both NFL and NHL teams rely heavily on the corporate client season ticket base. The problem is that almost all gate revenue in the NFL is derived from season tickets whereas only about half of the tickets sold in the NHL are season tickets. Corporate season tickets are more valuable than walk up tickets because they are more certain and inelastic with respect to winning and price.”
Vrooman pointed out that the Vegas pro sports market in general may not actually be as sure a bet as it may seem externally, which could magnify problems for both NHL and NFL in the future.
“Nashville is the 30th largest TV market with about one million TV households compared to Las Vegas (40th) with about 750,000 TV households,” he said. “Moreover, the Nashville corporate presence is much deeper and more fully diversified than Las Vegas’ heavy and non-diversified dependence on the gaming industry. This lack of economic depth in Las Vegas could make it difficult to maintain the consistent simultaneous season-ticket demand for both hockey and football in a top heavy economic oasis in the Southwest desert.”
But the hope from the Golden Knights is that more pro sports teams could actually be part of the economic solution for corporate dollars rather than a problem. Bubolz believes that the Raiders entering the area could increase the sponsorships for the Golden Knights as more groups invest in the Vegas sporting landscape.
“There’s a lot of national companies and a lot of national sponsors out there that may look at this marketplace that may otherwise wouldn’t have either for investments in sports, which obviously that’s the business that we’re in, or investments in moving their companies or some of their employees here to kind of take advantage of the market energy that’s happening as this market continues to grow and thrive,” Bubolz said.
Bubolz also pointed out that the NFL and NHL are different models and believes there won’t be as much crossover as some may think.
“The main thing is we’re two totally different businesses,” Bubolz said. “We’re a new franchise and we’re starting fro scratch and building our fanbase around the Vegas Golden Knights. The Raiders are already a strong regional brand with a strong fanbase. Now they’re just going to play in Las Vegas vs. in Oakland.”
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