Already in the middle of one out-of-market sports package,
many digital pay-per-view operators will launch the National Hockey League's "NHL
Center Ice" this week.
Much like the National Basketball Association's "NBA
League Pass" package, which launched in November, operators believe NHL Center Ice
will go a long way in helping cable to battle competition from direct-broadcast satellite
services in the short run, and that it could generate significant revenues in the future.
The half-year NHL Center Ice service, which starts Feb. 8,
will feature about 30 games per week for the rest of the NHL season at a suggested retail
price of $99.
The launch marks the first time cable subscribers have
access to the five-year-old package, which, up to now, has been the exclusive property of
DirecTV Inc. Last year, NHL Center Ice drew about 167,800 buys, according to The Carmel
Group.
NHL vice president of business affairs Doug Perlman said he
expects the operators carrying NHL Center Ice to generate buys relative to those in the
DBS universe, although the actual numbers will be far less due to the smaller universe --
about 1 million to 2 million digital-cable subscribers, compared with DirecTV's 8 million.
"As the [digital] universe grows, we certainly expect
the number of buys to grow," he added.
The league certainly benefits financially if the package
performs well. The NHL collects 70 percent of the revenues from operators, although cable
can reach a 40-60 split if it tops a nondisclosed buy-rate, sources close to the situation
said.
While operators are hoping to generate decent revenues from
the package, the ability to compete with DirecTV on the sports front is its greatest
appeal.
"As far as competition is concerned, NHL Center Ice is
an excellent package for us to have as part of our digital package," Comcast Corp.'s
Comcast Cable of New Jersey area PPV manager Priscilla Reilly said. "It's another
sports offering that will go far toward customer satisfaction."
Cox Communications Inc. of San Diego senior product manager
Marty Youngman said the package should produce strong buys in the market despite the lack
of a major hockey team. "I expect the NHL Center Ice package to do well," he
added, although he would not reveal specific figures.
Perlman added that offering the package on cable provides
the league with an opportunity to further expose the sport and its games to fans. Buys and
revenue for NHL Center Ice trail those of the three other major professional-sports
packages.
"It's a great revenue opportunity for us, and it gives
us a chance to expose the game to more people," he said. "We have an exciting
game, but we want to expose it to the widest audience possible."
With the digital-cable universe at between 1 million and 2
million subscribers, Perlman said, he's not concerned that the combined cable/DBS universe
for NHL Center Ice will cannibalize its cable and broadcast deals with ESPN and ABC Inc.,
respectively.
"At this point, [cannibalization] is more of a
theoretical issue," he added. "We want to make sure all of our partners are
comfortable with everything we do."
