For years, we’ve been dreaming of the day the salary cap made a serious jump thanks to the national TV rights. ESPN and Turner paid big bucks to take the NHL away from NBC Sports. It seems to be working out for them for a little bit of time. It was going to work out great for the New Jersey Devils.
Unfortunately, that last sentence had to be in past tense. It looks like the rise in salary cap brought on by the national media right is going to get eaten up by the major loss the league is taking in local media rights. Sinclair’s sports media arm is looking to commit bankruptcy and is currently in a 30-day grace period. That’s a major loss.
They have the rights to 12 NHL teams’ region sports telecasts. Most of the teams aren’t in the most desirable markets. It will be harder to sell the Arizona Coyotes, Columbus Blue Jackets, and Anaheim Ducks than it would the New York Rangers or Pittsburgh Penguins.
Well, at least it seems the NHL will look to find out. On top of the 12 teams whose rights are in flux, add three more to the list. Warner Bros./Discovery wants to get out of the regional sports business according to the Sports Business Journal. That means the rights to the Penguins, Vegas Golden Knights, and Seattle Kraken are in flux.
This means the rights will likely sell for much less than they did when these rights were originally signed. That is going to take a lot of money from league revenue. That means the players are going to have to foot half the bill. This is after the players and league already had to come up with a deal to make up for the lost revenue due to canceled games and empty arenas caused by the coronavirus.
The Devils are really hoping the salary cap goes up. Jesper Bratt has been available to sign an extension since January 1st, but how can the Devils do that with so much in flux? At first, it was the Timo Meier situation. However, they have enough cap space now to sign both players.
The issue is in the future. The Devils can afford to pay Dougie Hamilton, Jack Hughes, Nico Hischier, Jesper Bratt, and Timo Meier because they have Luke Hughes and Simon Nemec on entry-level deals coming into the league. Eventually, they will need bigger deals, and that’s when things get hazy.
Tom Fitzgerald needs as much money as possible to keep this star-studded team together. Heck, with all these lost revenues, the cap might go down.
On top of everything, the Devils are coming up on a terrible rights deal that’s ending in 2024. They’ve been tied to MSG Networks since the turn of the millennium. We don’t know what the Devils got for its rights, but it was called “substantially more than $8 million.”
We would hope so. Some rights deals are hitting the billion-dollar mark. The Devils wouldn’t be worth anything like that, but before all these rights deals went by the wayside, it wouldn’t be out of the question that the Devils would be worth $100 million per year. Now? Is it half of that? Less?
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This situation impacts all NHL teams, but it surprisingly impacts the Devils. For the good of the game, let’s hope it figures itself out.