MacKinnon: One-stop digital shopping, powered by hockey
Rogers deal with Oilers goes far beyond arena naming rights
EDMONTON - The Oilers players are not just athletes anymore; they are on-ice pitchmen in a 13-year, $700-million multi-platform play by Rogers Communications to enhance its Alberta footprint by selling cellphone plans and much else as they leverage the cultural imperative in the Heartland of Hockey.
When the Oilers open the 2016-17 National Hockey League season in Rogers Place, as the yet-to-be-built downtown arena will be called, they’ll be playing in “one of the most technologically enabled stadiums in North America,” said John Boynton, Rogers executive vice-president and chief marketing officer, at a news conference to announce the arena naming rights deal.
Rogers already owns a 37.5-per-cent stake in Maple Leaf Sports and Entertainment, which owns the NHL’s Maple Leafs and the Raptors of the NBA. It has naming rights on the Rogers Arena in Vancouver, where the Canucks play, and to Toronto’s Rogers Centre, home of the Blue Jays and Argonauts.
But Boynton said Rogers Place in downtown Edmonton will be “the crown jewel” in its massive investment in sport, hockey broadcasting and wireless technology across Canada. Boynton would not specify what portion of Rogers’ $700-million Alberta investment goes to naming rights for the Edmonton arena, which seems destined to become a high-tech cash box for Oilers owner Daryl Katz.
Think of the new arena as a big, wireless-enabled TV studio, with the players providing the programming that Rogers customers can enjoy on TV, their cellphones, home computers or tablets.
If Rogers has its way, all Oilers fans will be dialed into their team 24/7. And since Rogers paid a whopping $5.2 billion last week for exclusive Canadian TV rights to all NHL games for the next 12 years, customers can presumably be dialed into the team of their choice on whatever platform they choose.
Boynton delivered a couple of “shameless plugs” during his presentation Tuesday, including: “To celebrate the announcement, between now and Sunday all of the Rogers customers who upgrade their wireless handset will get two free tickets to (an) Oilers game. And anybody who wants to switch to Rogers between now and Sunday will also get two free tickets to (an) Oilers game.”
Perhaps the quality of the content — that is, the game results — will be happier by 2016. You have to think Katz, who did not appear at the news conference, was grinning from ear-to-ear over this announcement.
Rogers is investing in far more than naming rights for the new arena and marketing rights for the Oilers, the Western Hockey League’s Oil Kings and Rexall Place through 2016 for its $700 million. The deal was first announced on Oct. 1. The naming rights were folded into an expanded version of that agreement.
The telecommunications company also will open new retail outlets, build new data centres in Calgary and Edmonton, and expand its wireless network by building new cellphone towers in Alberta.
Meanwhile, the revenue streams flowing to the Oilers have ramped up dramatically.
The Oilers will receive an estimated $8-9 million annually from the $5.2-billion deal Rogers struck last week with the NHL for exclusive Canadian TV rights, including ownership of the iconic Hockey Night in Canada brand.
The Oilers will continue to earn significant TV money from its existing, regional deal with Rogers-Sportsnet, which broadcasts 60 regular-season games. That deal runs through 2020.
The Oilers already derive an estimated $5 million annually from the NHL’s TV deal with NBC. Add in the unspecified naming rights cash, and the $64.3-million annual salary cap the hockey franchise must meet starts to look far less daunting, even as it rises to an estimated $70 million next year.
The $5.2-million national deal and Rogers’ $700-million agreement that includes naming rights for the Edmonton arena were negotiated separately, but the marketing and content possibilities seem mind-boggling. By happy coincidence, both deals expire in 2026.
All of that revenue is before the club sells a single ticket.
Asked what sorts of wireless possibilities to enhance the fan experience will be on offer at Rogers Place, Boynton said; “We’re talking about, on game day, knowing a lot more about the matchup, how that interacts with you online and on your cellphone; we’re talking about knowing where to park, which parking lot’s full, how you should get there, how the transit is, what the weather is like.
“We’re talking about ordering (food and beverage) from your seats; knowing what the lineup in the bathroom is like; we’re talking about seeing slow-motion replays on your phone; we’re talking about cameras that might follow one player the whole game all the way through.
“We’re talking about being able to replay all the goals at the end of the game; we’re talking about going home and seeing all the stats and how many players did what, being able to follow certain plays from the game.”
A key driver behind Katz and the Oilers negotiating for four long, often nasty years with the City of Edmonton on a partnership to build the $480-million arena was Katz’s contention that without a new, state-of-the-art building and access to all the revenue from all the events held therein, the team’s future was uncertain.
“(There) is less dependency on the day-to-day (ticket sales),” LaForge said in a massive understatement.
Oilers president Kevin Lowe described the deal as a “sign of the times.”
“All the media stuff now, they talk about the platforms,” Lowe said. “You started hearing those catchphrases a few years ago, and why media was going to push the business of hockey, right?
“Because these guys (Rogers), they need content, they need stuff on there. But it’s not just television, it’s phones (and tablets and computers).”
With three Rogers deals delivering huge revenue to the Oilers, Lowe said, “The moons have aligned for Edmonton, with Rogers looking to spread their wings, the NHL deal, the deal that (LaForge) did on the telecommunications side and now the building (naming rights) all wrapped into one is convenient.”
Call it one-stop digital shopping, all powered by hockey.
Oh, and about the arena itself. LaForge said he had no reason to believe ground will not be broken by next spring, as expected, with a construction schedule of 20-24 months to follow. That would put the facility on track to open in the fall of 2016.
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