After playing an incomprehensibly foolish game of chicken for the past five months, it looks like the NHL and the NHLPA may have run out of time to save the 2004-05 season.

The two sides met last night in New York in a last-ditch effort to cobble together a new collective bargaining agreement, but reports indicate that the players rejected what could be the league’s final offer, and there is little or no time left to implement a divergent strategy. Once again, it appears that the league demonstrated an unwillingness to engage in any meaningful revenue sharing, while continuing to hold fast on its demands for cost certainty in the form of a team-by-team salary cap.

No further meetings are scheduled, and it is now more likely than not that the NHL will be the first of North America’s four major sports to cancel an entire season from beginning to end.

Even if by some miracle the season is saved, the league is still a long way from confronting the root causes of the current crisis. Expansion into new Southern markets has been a failure. The league’s television contract is on par with that of the Arena Football League. The quality of play has deteriorated consistently over the past decade. The NHL’s market share was in decline even before the lockout, and the league’s $2.1 billion business has shrunk considerably in recent months – merchandise sales were down by 86% this past Christmas.

“I think they are creating a large problem for themselves,” said noted sports economist Andrew Zimbalist. “They have a thin fan base, and have not taken advantage of the television revolution since the 1980s as the other leagues have. After this lockout, their audience – both live and on television – will be substantially reduced, and it won’t be an easy process to recover.”

But the NHL is not doomed. Hockey could thrive in at least a dozen untapped markets across Canada and Europe, and as last summer’s World Cup showed, the game showcases unparalleled grace and intensity when played at the highest level. The NHL may never rival the other major sports in North America, but the possibilities for global expansion are promising.

The league must start by recognizing that hockey does not belong in Nascar country. Teams in nontraditional markets can draw fans if they consistently compete on the ice – the Dallas Stars being a prime example – but since only 16 of the league’s 30 teams reach the playoffs in any given season, there is no way to provide “success certainty.” Instead, the league should consider relocating struggling teams to markets where they would enjoy consistent support, win or lose.

Some moves are obvious. The Phoenix Coyotes would be a great fit in – you guessed it – Winnipeg, the very city they departed in 1996. According to Winnipeg Councilwoman Jenny Gerbasi, a new 15,000-seat, state-of-the-art arena is ready to welcome back the Jets.

“During the debate regarding whether we could save the Jets, we had 5-year-olds emptying their piggy banks trying to help,” Gerbasi said. “This is a hockey-loving town. If there’s some way to deal with player salaries – a way to make it work financially – people would definitely support the team.”

It’s also clear that the Toronto area could support a second team, especially if the New York City area can support three. Though the Maple Leafs would likely bristle at the possibility, a move to southwestern Ontario would be just what the doctor ordered for the Florida Panthers, whose talented young team would gain immediate support among the legions of local Leaf-haters.

Terry Whitehead was part of the group that bid for an NHL team on behalf of Hamilton in the late 1990s. The NHL ultimately chose Columbus, Ohio, but the city of Hamilton has not given up hope.

“We sold approximately 14,000 season tickets in 24 hours,” Whitehead said, recalling the unsuccessful 1997 effort to bring an NHL team to Hamilton. “It’s very difficult to get tickets to Leafs games, and so there is a lot of pent-up demand. Rivalries drive interest in hockey, and if there were a team in Hamilton, it would immediately generate two tremendous new rivalries.”

Another team in need of a change of scenery is the Carolina Hurricanes, whose appearance in the 2002 Stanley Cup Finals did little to grow the local fan base. The Atlanta Thrashers are similarly challenged despite boasting two of the league’s brightest young stars (Dany Heatley and Ilya Kovalchuk), while the Mighty Ducks have remained unpopular in Anaheim despite their 2003 Stanley Cup run. And the Nashville Predators, who barely averaged 13,000 fans a game in 2003-04, were a bad idea from the beginning.

Contraction is one option, but the architect of the league’s overreach, Commissioner Gary Bettman, is firmly opposed to the idea. Instead, the league should explore its options in Europe, where 360 NHLers are playing out the lockout in 18 different countries.

The establishment of a five-team European division with franchises in Stockholm, Moscow, Prague, Helsinki, and Berlin would allow the league to capitalize on its rapidly growing base of European talent. Scheduling could pose some logistical problems, but by increasing the number of divisional matchups and shortening the regular-season schedule to 60 games, trips to Europe wouldn’t be much more onerous than coast-to-coast trips in the current NHL. More importantly, the inconveniences would be outweighed by the opportunity to get a leg up on the NBA, which up to now has been far more successful at marketing itself across the Atlantic.

European professional leagues have at times struggled to maintain fan interest as the best homegrown players have moved to North America – in 2003-04, 76 Czech players suited up in the NHL, along with 64 Russians, 53 Swedes, and 37 Finns. This season, however, their return has helped rejuvenate the European professional leagues, offering a glimpse of the fan base an eventual NHL expansion could draw upon. According to Szymon Szemberg of the International Ice Hockey Federation, the rise in attendance has been between 5% and 7% across Europe.

Some of the more aggressive clubs have enjoyed an even greater boost. The Djurgarden Hockey Club in hockey-mad Stockholm, for example, added five NHLers, most notably goalie Jose Theodore of the Montreal Canadiens.

“In the last five games, we’ve seen attendance rise by about 2,000 fans per game,” said the club’s general manager, Tommy Engstrom. “I hope the attendance will keep on increasing [when the NHL’s labor dispute ends], but there’s a lot of uncertainty here in Sweden where that is concerned.”

The NHL players’ impact is most obvious when their teams play on the road. Games are sold out wherever Peter Forsberg’s Swedish club MoDo travels, and the same holds true for the New York Rangers’ Jaromir Jagr, who played 17 games for the Czech Republic’s Rabat Kladno earlier this season. A game Jagr played in Prague against Slavia Praha drew nearly 16,000 fans, or four times the average attendance for last season.

After leaving the Czech League, Jagr signed on with Avangard Omsk of the Russian Super League, a team owned by Russian billionaire Roman Abramovich. Abramovich also owns Chelsea of the English Premier League, and rumors persist that he hopes to soon add an NHL club to his rapidly growing sports empire.

Along with seeking out new markets, the NHL must also play more attention to its televised product. Even die-hard hockey fans will admit that the sport translates badly on television, but high definition television, with its wider 16:9 perspective and sharper presentation, could help sell hockey to casual sports viewers. The league should do whatever it can to speed HDTV’s progress, perhaps by forming an all-NHL HDTV channel that would initially be provided to cable operators both in America and in Europe at a steep discount.

An ideal partner in the venture would be Dallas Mavericks owner Mark Cuban, a passionate hockey fan whose HDNet televised 65 NHL games last season.

“The response was amazing,” Cuban said, when asked about viewership. “People said it was so completely different than the past. People who hadn’t been hockey fans got hooked on the game. It sells itself.”

Selling the game, of course, would become easier following major improvements to the on-ice product, which has degenerated with the widespread adoption of the neutral-zone trap.

Recent meetings between the NHL and prominent coaches such as Marc Crawford and Ken Hitchcock have focused on eliminating obstruction. This is a positive sign, but more far-reaching changes are needed. Among other things, hooking and crosschecking must be penalized consistently, fighting should be outlawed, and goaltending pads should be reduced in size.

Another interesting step toward rendering games more exciting would be shootouts to decide tied regular-season games – but never playoff games. The adoption of shootouts this season in the American Hockey League (the NHL’s minor-league affiliate) has helped ensure that teams play more open, aggressive hockey in the third period.

The answers will not come easily for the NHL, but dramatic steps are required in this time of desperation. The sooner this labor dispute ends, the sooner the NHL and NHLPA can start ensuring the game’s long-term health and future success.

Mr. Greenstein is the editor-in-chief of INSIDE HOCKEY (insidehockey.com).