NHL Expansion Quebec City

Quebec City Will Not Get an NHL Team Anytime Soon

The last time a new Canadian franchise was announced was on June 1st 2011. The news shocked the world, as the Atlanta Thrashers were moved to Winnipeg. Many were expecting then Phoenix Coyotes to be the candidate to move, but the hockey world was swerved. Since the relocation of the Atlanta Thrashers to Winnipeg, there’s been renewed hope for a new NHL franchise in Quebec City. Quebec City mayor Régis Labeaume did everything to prop his city as the next contender for a franchise. He secured the funding and partners needed to build a new arena. He was able to invite NHL executives over on multiple occasions. He even spoke out to the media and to other branches of politics in order to gain momentum for his cause. However, according to Boston Bruins owner Jeremy Jacobs, Quebec City will have to wait a while longer for an NHL.

Many residents of Quebec City and the province of Quebec were disappointed to hear the harsh truth. The city had already lost their franchise, the Quebec Nordiques, in a shock relocation to Denver in 1995. It suffered further when the new Colorado Avalanche won the Stanley Cup in their inaugural season. Since then, the Montreal Canadiens have been the only NHL franchise in La Belle Province, and hockey fans are up in arms. Yet, there is a logic behind the lack of enthusiasm toward Quebec City. Finances, demographics and politics aside, let’s look at the real reasons behind the lack of NHL hockey in Quebec City:

The Fall of the Canadian Dollar

Jacobs, a senior member of the NHL’s Board of Governors discussed the reality of the NHL’s future plans for expansion/relocation. Jacobs pointed out the income base and the population base of Quebec City as glaring issues. Quebec City has a population of 550 000 and a metropolitan population of 820,000 as we speak. Although Jacobs could be worried about the income base, it is not to say that Quebec City residents are more poor than American cities.  He actually meant that residents earn less than the average American because league revenue is calculated in USD (American dollars). This puts Quebec City at an immediate disadvantage in terms of potential revenue measurement.  Back in 2016, NHL Commissioner Gary Bettman even said “the fluctuation of the Canadian dollar throughout the process was a factor”. Although the Canadian dollar has stabilized at about 0.78 USD for every Canadian dollar, that is still a huge hill to climb.

When the relocation from Atlanta to Winnipeg happened in June of 2011, the Canadian and American exchange was even. This meant that the Jets wouldn’t have an immediate disadvantage in relation to other American teams. However, with the fall of the Canadian dollar in 2015, the strain has been felt by the Jets, who receive significant subsidies from both provincial and municipal governments to stay profitable. Even if Quebec City could sell-out every game, they wouldn’t be assured to break even, let alone make a profit.  Quebec City has financial issues to overcome, but it isn’t the major reason they do not have a team. From an organizational perspective, the NHL wants 32 teams; 16 in the west and 16 in the east. The problem for Quebec is that the NHL already has 16 teams in the Eastern Conference, with no signs of relocation ahead.

The Quest for 32 NHL Teams

In 2013, it was announced that the NHL would undergo a realignment start in the 2013-2014 season. The Columbus Blue Jackets and the Detroit Red Wings were finally granted their wish of being in the Eastern Conference. Both teams had to bear the brunt of an extremely difficult traveling schedule. On top of the toll of travel, Detroit and Columbus were the only teams in the conference to be in the eastern time zone. Consequently, their TV viewership also took a hit since most of their away games would start between 8 to 10 pm Eastern Time. After years of convincing, the NHL seemed to all of a sudden agree to a change. Why so quickly after years of playing it down? Well, it has a lot to do about opportunity.

When the realignment took place, the NHL announces that there would be 16 teams in the East and 14 teams in the West. Immediately, the five-year old in us pointed out that the conferences were uneven. That was made purposefully by design, as they were eyeing two key locations in the Western US: Las Vegas and Seattle. The NHL had committed itself then and there to become a 32-team league in order to rectify the travel imbalance and cash in on expansion fees. Now that Vegas has become the 15th team in the Western Conference, it seems almost inevitable that a franchise will be given to the city of Seattle. Never before has a city without an arena or a concrete ownership group been given the fast track to expansion by the NHL. This means that the NHL is primarily focused on balancing out the conferences before looking at any possible relocation. That leaves one final question though: Why would Jeremy Jacobs believe Houston to be a better market than Quebec City. 

The Focus on US NHL Television Rights

The NHL makes most of its money through the sale of their television rights. In recent years, the NHL has signed very lucrative deals for their television rights. In 2013, the NHL agreed to a 12-year agreement, announced jointly by the NHL and Rogers is for $5.232 billion (CAD). In the US, MSNBC is paying $2 billion over 10 years. This was a huge win for the NHL, as they were able to significantly boost their revenue. However, not two years later, the NBA, which granted has a far bigger market, signed a 9 year $24 billion deal with ESPN. The NHL has seen their product gain in popularity over the years, and more teams in every corner of the US would help their chances of signing a better deal in 2025.

Consequently, adding Vegas and, eventually, Seattle will go a long way into shoring up the NHL’s presence in the Western US. Lastly, a team in Houston would surely help ratings for MSNBC, as any franchise in that city would have Dallas as a natural rival. They could also be a relocation from a struggling franchise with struggling viewership numbers like the Coyotes. We have seen with Vegas that expansion/relocation is very attractive as a publicity stunt and a marketing venture. It would certainly aid them in drawing engagement from their fan base and increasing its size moving forward. Sadly, a team in Quebec wouldn’t help them much there, as the Quebec market is already in the NHL’s back-pocket. The league is looking for new ventures and markets to exploit, not to add a team in a market that is already hockey crazy.

Relocation: The only way

It seems like the only way Quebec City will ever get a team is if a struggling Eastern Conference team gets hit with a drastic economic blow. The Carolina Hurricanes and the Florida Panthers are the most likely candidates, but their new owners are confident that they can keep the teams put. With that said, Quebec City will most likely be left waiting again for another 10 years and it sucks for Canadian hockey fans. However, remember one thing about the NHL. In order for it to continue to grow the game, it will move further and further away from Canada. Their games in Europe and Asia are proof that the NHL’s expansion is going everywhere but Canada. As the current alignment stands, Quebec City would only be able to pray for a relocation to occur, and I don’t see that happening for another 5-10 years.