NHL May Lose by Checking Rangers

Back in September, the Rangers filed an antitrust lawsuit against the National Hockey League, alleging that the league had threatened to fine the team $100,000 a day if they didn’t relinquish control of their Web site to NHL.com. The league fired back on Wednesday, filing court papers to kick Madison Square Garden LP, the owners of the Rangers, out of the league, or force them to sell the team as punishment for accusing league officials of violating antitrust laws. In its court filing, the NHL asked a judge to agree Madison Square Garden breached its contract by challenging league rules.The NHL said such a breach can lead to disciplinary proceedings in which a vote of three-quarters of the members of the league can decide to issue fines, suspend, or terminate membership in the league; order a sale of the club to a new owner, or suspend or expel individuals involved in the team’s management. The commissioner of the league, Gary Bettman, also noted that the NHL constitution prohibits league members from resisting or trying to prevent termination in the league through the courts.“Not surprisingly, the NHL is once again proving why an independent judge must address our claims,” a spokesman for MSG, Barry Watkins, said yesterday. “Despite trying to resolve our differences privately, the league has responded with excessive fines and now threats that have nothing to do with the merits of our position. The NHL shouldn’t be afraid of the judicial system. We will pursue our case vigorously and will not be intimidated by the NHL’s bullying tactics.”The debate is an interesting one, as there are strong arguments for (and against) both positions. As the Rangers’ argument went, the team wanted the right to control its own Web site, profiting from its high-profile standing among the NHL’s 30 franchises, rather than adopting the league’s “homogenized … cookie-cutter” version, as was stated in an Associated Press story in September. The Rangers are indeed correct that their Web site — if independently run — would be more profitable: The Blueshirts are based in the NHL’s largest press market, and have cultivated their fan base over many generations. Rangers fans are traditionally among the most spendthrift when it comes to purchasing team-branded merchandise, and the team’s Web site has become an important cog in their well-oiled moneymaking machine.That all said, the NHL, as an organization, has an obligation to all 30 teams, not only to the Rangers. The league is attempting to follow in the footsteps of Major League Baseball, whose Advanced Media division (MLBAM) is responsible for delivering a huge boost in revenues — now over $6 billion annually. Without question, having the Yankees’ and Mets’ Web sites under their umbrella has been a critical component of MLBAM’s tremendous success.Back in 1995, the NFL aggressively attempted to prevent the owner of the Dallas Cowboys, Jerry Jones, from striking lucrative endorsement deals with Nike and Pepsi for Texas Stadium (in direct conflict with the league’s deals with Reebok and Coca-Cola). Jones ultimately prevailed in that dispute, and the long-term result was a positive one for both the Cowboys and the league. Likewise, the Yankees consummated an enormous $95 million sponsorship deal (at the time) with Adidas in 1997, one that MLB initially objected to, but ultimately allowed.There are certainly some similarities between those two concerns and those of the Rangers, but the Blueshirts haven’t had much success thus far with their legal complaints. In their original lawsuit, they claimed that MSG had spent years developing the site to market Rangers hockey in competition with other NHL teams. By seizing the site, the Rangers argued, the NHL would effectively eliminate competition between teams and harm consumers.But in November, a judge ruled that the league seemed within its rights to take control of the team’s Web site; unless the Rangers are somehow able to prove that consumers are negatively impacted by the league’s takeover, it seems somewhat unlikely that they’ll receive a more favorable result moving forward.The NHL business is primarily gate-driven, with most revenues generated locally. Therefore, it is incumbent upon the league to act aggressively and take whatever measures it can to increase national league-wide revenues.A huge component of the success of the other three major North American pro sports leagues has been their ability to secure lucrative national television contracts. Because the NHL isn’t able to do the same — there simply isn’t the same level of interest in ice hockey in the Sunbelt as in the Northeast — new media represents the most fertile ground upon which to sow the seeds of growth.Hockey is a mainstream sport in its most entrenched markets, but it remains a curiosity in places such as Nashville, Raleigh, and Tampa. It is impossible to know whether the teams there will one day be as successful as the Rangers are in New York — just as it is pointless to debate after the fact whether the NHL should have located teams in those nontraditional markets. Reality is what it is, and it’s difficult to see how the concerns of the Rangers can possibly supersede the NHL’s in this debate over Web site control.That all said, it’s even more difficult to see how the NHL would benefit in any way from taking punitive action against the owners of the Rangers. Madison Square Garden is the NHL’s most high-profile venue, and the Rangers are arguably its most important franchise: Forcing a sale and relocation — the team’s owners also own the building in which they play — hardly seems like a desirable result.The sooner the sides work together to reach a mutually beneficial solution, the better. After a lockout wiped out the 2004-05 season, the NHL has done a fine job of getting back on track. For it to lose any of that precious momentum by engaging in an ill-advised donnybrook with the Rangers would be an inexcusable mistake.Mr. Greenstein is the editor in chief of InsideHockey.com.

NHL May Lose by Checking Rangers

NHL May Lose by Checking Rangers

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