NHL heads for Australia with long-term growth opportunity as primary goal

NHL heads for Australia with long-term growth opportunity as primary goal

Editor’s note: This article was written by Alex Silverman and first appeared in Sports Business Journal, the industry’s leading source of sports business news, events and data.

The NHL will become the first major North American sports league to play in Australia in nearly a decade when the Los Angeles Kings and Arizona Coyotes face off in a pair of preseason games this weekend in Melbourne. Bringing the NHL to a far-flung destination with little ice hockey infrastructure is more challenging and expensive than the league’s other overseas events, but the league sees plenty of potential.

“It’s a really good sports market, really interested in terms of learning about U.S. sports, and there’s a hockey infrastructure — a domestic hockey federation and a domestic hockey league,” said David Proper, NHL senior executive vice president of media and international strategy. “All of those things came to coalesce to bring us to the conclusion that we could try to grow a business there.”

No major North American sports league has ventured Down Under since MLB drew more than 76,000 fans for two regular season games between the Dodgers and Diamondbacks at the historic Sydney Cricket Ground in 2014. MLB declined to comment on why it hasn’t been back to Australia since. The NFL played a single preseason game in Sydney back in 1999, and the NBA has never made the trip.

“We made the decision to go to Australia purely because of our evaluation as it relates to the NHL, which had nothing to do with what the other major sports leagues in North America had done except to make sure that they had the relative successes necessary to show that we could pull this off logistically,” Proper said.

The NHL will also be the first league to go to Melbourne rather than Sydney. Lynn White, NHL senior vice president of international, called the city the “sporting capital of the country.”

“They spend a lot of their disposable income on entertainment and events specifically, and you see this from the other events that are in that market,” White said, pointing to the Australian Open tennis tournament, F1′s Australian Grand Prix and Australian Football League final.

Jason Moore, the Sydney-based event promoter who worked with MLB in 2014, said that promoters in the country have to convince leagues to look past the “tyranny of distance” — direct flights from the West Coast are over 15 hours — by offering financial incentives and agreeing to cover major costs such as travel and lodging. “The fundamental limiting step is they need someone that can put it all together and then almost write the check so that their exposure and their risk is mitigated as much as possible,” he said.

The NHL declined to comment on the specific cost and its financial arrangement with promoter TEG Sport. Visit Victoria, the state tourism board, is the event’s biggest sponsor by far, White said. Other local sponsors obtained by TEG and the league include Crown Hotels and Resorts, Bet365 and the state Transport Accident Commission. Global NHL partners sponsoring the event include Amazon Web Services, Extreme Networks, SAP, Scotiabank and Upper Deck.

“If it’s going to be profitable, it’ll be right on the edge of things,” Proper said. “We really view this as more of an investment in a long-term growth opportunity, just the way we do for any games we play internationally.”

Sports Business Journal