Whew, that was a mouthful just typing it out, but it’s not an exaggeration to suggest that the controlling sale of Maple Leaf Sports and Entertainment (MLSE) to the pairing of Bell Canada and Rogers Communications will have a major ripple effect.
Say what they might about this solely being about MLSE proper, this reaches beyond the organisation. There are several different angles for me to tackle and not a clean way to organise it, so I’ll try my luck at just stabbing wildly at the middle and see what I hit.
First, this is about sports and entertainment holdings. Maple Leaf Sports and Entertainment is not only the Crown Jewel in Toronto’s sports landscape, it is the crown. MLSE owns three of the four major sports teams in Canada’s largest city, including the recession and losing-record proof excuse to print money, Toronto Maple Leafs (NHL). Along with the Leafs, MLSE owns the NBA’s Raptors and MLS’ Toronto FC. When combined with ownership of the Air Canada Centre arena (home of Leafs/Raptors) and management of BMO Field (Toronto FC) and Ricoh Coliseum (home of AHL’s Marlies – another MLSE holding), the owners of Maple Leaf Sports and Entertainment stand to own or control almost every major draw in town, and the places to see them (not to mention the various non-sports events, such as concerts, that the facilities host). This is a huge acquisition from a traditional business view. It’s only sweetened by the fact that Rogers already own Toronto’s MLB team, the Blue Jays, and their home, Rogers Centre (formerly the SkyDome).
Secondly, this is about 21st century synergies (an awful word, but one that fits with what this is meant to be). Bell and Rogers are huge conglomerations on their own, with dirty fingers in every piece of the pie. It’s easy to look at them as direct competitors with a lot of similarities, so it’s interesting that they decided to pair together rather than fight to the death. It will remain to be seen if this lasts or if it ends up like Bart, Milhouse and Martin collectively buying Radioactive Man Issue #1 (“How about this, guys? Bart can have it Mondays and Thursdays, Milhouse will get it Tuesdays and Fridays, and yours truly will take it Wednesdays and Saturdays.”).
Conventional wisdom says that if they stick it out and find enough of a way to make this work, this will be a major acquisition for both companies in multiple areas. Bell and Rogers both have content they need to create for their many channels. There are the traditional homes for sports in Bell’s TSN and Rogers’ Sportsnet, but there will also be the possibility of linking up with more generalised broadcasters, such as Bell’s CTV or Rogers’ CityTV. They might use this a possibility to widen the audience by broadcasting in additional languages on multicultural stations, such as Rogers’ OMNI (CBC’s Punjabi coverage of Vancouver Canucks could be the model). Maybe there is a way to link non-sports events, such as a major concert visit at the Air Canada Centre with additional content on specialty channels such as Bell’s MuchMusic. It will, however do nothing to dispel notions that Canadian media is Toronto-centric (Bell’s TSN is already derogatorily referred to as the Toronto Sports Network).
That’s just the TV side. Bell and Rogers also have other business lines that can get involved in the synergy. Bell already offers TSN Mobile to their own smartphone customers. Imagine the exclusive content that a company that owns the sports team, the channel its broadcast on, the cable/satellite provider, and wireless services. It’s going to raise concerns about the start of some crazy monopolisation, but with two competitors involved, it’s more likely to be a cabal. Both companies also own print publications (which still exist, as far as I know), so look forward to that cheery 16-page Maclean’s special on Phil Kessel.
Thirdly, this means competitive sports teams. Laugh if you’d like, but taking ownership of MLSE from the Ontario Teacher’s Pension Plan will most likely result in more competitive teams, or at the very least, attempts to make more competitive teams. By definition, a pension plan needs to make sound investments and get a reliable return on that investment. It is not about risk. It is not about “going for it”. When teams are given the backing to compete and resources are provided to make it happen, it creates the possibility of a good thing. The Toronto Maple Leafs are largely the exception in this rule. Before Brian Burke and his barely-tied tie arrived in town, the Leafs were given unlimited resources and still didn’t manage to have a competitive team. It took the surly American to come in and bring in his brand of hockey for it to happen (for better or worse). The management of Toronto FC (Aron Winter) and the Raptors (Bryan Colangelo) are both very intelligent men, but with very different available resources than the Leafs. It’s no secret that the financial stability of hockey in a hockey-mad city made it possible for the Leafs to spend like crazy in every area. Now we might see what the basketball and soccer teams are capable of. No, it doesn’t mean wildly overspending for free agents or designated-players (though that might happen), but it could mean investing more funds in scouting and player development. These are unseen activities that can pay major dividends. Rogers has already begun the process in their other toy, the Toronto Blue Jays, building a solid core and bringing in big trade pieces in MVP-calibre Jose Bautista and future all-star Brett Lawrie.
Finally, though no one wants to say it, this means the beginning of the end for Hockey Night in Canada and other professional sports broadcasting at the CBC. In acquiring all the pieces in Toronto and the biggest pieces in the Canadian sports landscape and choosing to share them amongst themselves Bell and Rogers are in a position of power and privilege and either have to wait out CBC’s existing NHL contract (until 2014) or step up now and force the NHL to accept a giant wheelbarrow of money from one of its owners (remember how Molson wrestled away “official” beer status away from Labatt? Completely unrelated to the Geoff Molson who is the controlling owner of the Montreal Canadiens). It is unfathomable to believe that the public broadcaster in any era, but certainly in an era when public expenditures need to be cut to reduce a deficit, would be able to beat a bid from the Dual-Headed Dragon. It is debatable whether it is in the public interest or not, or whether we ought to preserve the legacy of HNIC as an institution, but I would not be surprised if the 2013-2014 Stanley Cup Finals is the last time we see Don Cherry employed on television.
This has been a while in the making, but with sports specialty channels covering weeknight games, it’s only a matter of time when their brand (and money) finds its way to Saturday night. TSN already owns the old HNIC theme song, just wait until they (with Sportsnet) are able to step into negotiations with the full backing of Bell and Rogers. There is money out there. Believe me. Did you notice that the CFL is pretty much a TSN brand now? Or how about CTV broadcasting the Super Bowl?
Biggest pie ever: Vancouver 2010 Winter Olympics, an ad-hoc co-broadcast between Bell and Rogers on their various channels. That ought to be read as the example of why they think this MLSE marriage thing might work. There is so much content out there, let’s just buy it and divvy it up the way kids do Halloween candy.
The point is, the CBC is about to be out in the cold now. It should be reading the writing on the wall. Professional sports is not gonna come cheap. Maybe this is the time where they pack it all in. Maybe this is where they look to amateur and semi-professional sports (perhaps coverage of CHL junior hockey or CIS college athletics). I’d just be willing to bet that come October 2014 I’ll be watching Jim Hughson on a Saturday calling the Toronto-Montreal opening night game on TSN.