Monday, June 19, 2017

China Key to Unlocking NHL Olympic Hockey Boycott

For 50 years, the National Hockey League (NHL) has been struggling in vain to break through in the American television (TV) market. When Sidney Crosby won his 3rd Stanley Cup with the Pittsburgh Penguins earlier this month, more Americans watched Celebrity Family Feud than the NHL telecast in the same time slot. The next night, the National Basketball Association won the United States (US) ratings battle with an audience three times larger than the number of NHL viewers.

The Olympics account for the 5 most watched hockey games in US TV history. The NHL has never managed to turn an Olympic hockey buzz into more American viewers. No American audience for a NHL game has come close to the viewership for team USA playing an Olympic final or semi-final.

Disappointed by the impact of past Olympics on NHL ratings, Commissioner Gary Bettman decided that his league had nothing to lose by threatening to boycott the 2018 Olympics in South Korea. Bettman demanded free use of the Olympic rings logo in NHL advertising as the price of player participation at the 2018 Games. When International Olympic Committee (IOC) President Thomas Bach rejected Bettman’s condition, the NHL blocked their players from going to the 2018 Olympics.

Bettman and Bach are two alpha males locked in a stand-off. Neither will back down. However, until the 2017-18 NHL schedule is announced, a tiny window remains open for a last-minute compromise.

China can save Olympic hockey at the Games in South Korea. China has replaced the US as the NHL’s new dream market with 1.4 billion potential hockey fans. Before scheduling two NHL exhibition games for September 2017 in Beijing, Bettman called China an “exciting, interesting opportunity that, based on the sheer magnitude of the market, can’t be and shouldn’t be ignored.”

Bettman will surely allow NHL players to attend the 2022 Olympics in Beijing with no strings attached. The IOC should take advantage of NHL lust for the Chinese market. If the NHL releases its stars for the 2018 Korea Olympics, allow the NHL to use the Olympic logo. But, restrict that right to advertising in China until the Beijing Games conclude in February 2022.

The NHL would jump at the chance to use the Olympic logo in Chinese advertising for the next 5 years. The IOC would not be conceding much. There are 12,000 Chinese hockey players and 1,399,988,000 Chinese people not interested in hockey. How much could five years of NHL advertising, even with the Olympic logo, change China’s sporting culture? If the two sides bargained freely without threats, the IOC would not be able to charge the NHL the usual king’s ransom for the Olympic logo if use were restricted to China. 

After so many concussions, Sidney Crosby may be near the end of his career. By giving the NHL a win of little value, the IOC could let Canadians see Crosby match his 3 Stanley Cups with a 3rd Olympic gold medal in Korea next year. 

(How does this post connect to the Ontario economy and the other provinces? Canadians watching Olympic hockey in the middle of the nights and early mornings in February 2018 might have a small impact on productivity. That's the best I've got as an explanation. The sad truth is that I want to get this idea into circulation before it's too late and I couldn't find a better outlet than my own blog.)

Tuesday, January 31, 2017

Ontario Gold for Nominal GDP Growth

In terms of nominal Gross Domestic Product (GDP) at current prices for each year (NOT adjusted for changes in the prices of each province's products), Ontario ranked 1st averaging 4.8%/year from the base year of 2013 to the latest data for 2015. BC was 2nd at with 4.5% annual GDP growth, PEI 3rd at 3.7%, Manitoba 4th at 2.8% and Quebec 5th at 2.2%. 

Why am I reporting nominal GDP growth? 2015 was an unusual year when oil prices fell sharply. As a result, Alberta's nominal GDP fell by -12.5% between 2014 and 2015. Newfoundland suffered a -11.5% GDP decline and Saskatchewan GDP fell by -5.7%. 

Alberta's real GDP measured in units of production valued at 2007 prices fell by -3.6% in 2015. But, to my mind, the -12.5% nominal GDP decline measures the pain suffered by Alberta workers, businesses and governments in 2015 better than the -3.6% real GDP fall.

Measured in real GDP, BC was the growth leader averaging 3.3% with Ontario at 2.6%.

Over short periods, provincial governments cannot be held responsible for GDP growth. Alberta does not control oil prices. Neither Ontario nor Quebec controls American demand for their exports. However, I do believe that over much longer periods measured in decades, part of the difference between Ontario vs. Quebec GDP growth rates will reflect provincial government economic policy frameworks. Let's see whether the Quebec tortoise catches up with the Ontario hare as the years go by.