April 2011 The New Economics of the NHL WHY CANADA CAN SUPPORT 12 TEAMS Tony Keller APPLIED PUBLIC POLICY RESEARCH INFORMED BY ONTARIO’S REALITY The New Economics of the NHL: Why Canada Can Support 12 Teams By Tony Keller with ISBN 978-0-9867464-7-5 ©Mowat Centre for Policy Innovation A digital copy of this report is available at the Mowat Centre’s website at www.mowatcentre.ca. To order printed copies of this publication for a fee, please contact us by email at
[email protected]. Why Canada Can Support 12 Teams 1 Executive Summary or four decades, the NHL has pursued a Southern Strategy, increasing the number of teams in the United States, particularly in the fast- growing Sun Belt, in an effort to grow interest in hockey in the US. These efforts have been largely unsuccessful, with many of these Ffranchises suffering from low fan interest and low revenues. As a result, there is increased pressure to relocate some of these teams to Canada where demand for hockey is stronger. In this Mowat Commentary, we estimate how much stronger this demand is, and identify which Canadian cities would be the best locations for new NHL teams. We conclude that Canada can likely support 12 NHL teams, or double the current number of Canadian franchises. We analyzed 10 Canadian markets, assessing their ability to support an NHL team. We conducted a regression analysis, along with a qualitative analysis of the demographic and economic strengths of each market. Each of the potential NHL cities was compared to our benchmark city, Edmonton.