Dave Molinari on the Penguins: Igloo might be one of the few places where there isn't panic these days.
A weekly look inside the team, the issues & the questions
October 19, 2008 4:00 AM
Recession? What recession?
There was another standing-room crowd at Mellon Arena last evening.
Another game-night during which the luxury boxes were filled to capacity and the arena's pro shop was crowded with fans eager to shed a little disposable income.
Hockey, especially when played by a team as entertaining as the Penguins can be on occasion, provides a pretty nice distraction from the problems of the real world. Everything from the headaches of day-to-day life to the economic meltdown that has jolted the planet during the past few weeks.
And while few individuals or businesses can escape the impact of recent events, whether it comes in the form of value strip-mined from retirement accounts or declining gasoline prices, the Penguins don't seem to be feeling any major effects.
Not yet, anyway. And, even in a worst-case scenario, probably not for a while.
"We were fortunate enough to have a sold-out season last season and this season will be sold out," team president David Morehouse said. "We sold out our [luxury] suites. Our sponsorships, if not already sold, we have verbal agreements.
"We have a [season-ticket] waiting list of 2,500 names. We have 14,000 tickets sold, and a waiting list of almost 5,000 tickets. We're fortunate that it hasn't hit us yet."
And, he insists, team officials don't really expect it to, at any point. He's unabashedly optimistic that the economic situation will stabilize and improve in the reasonably near future.
"All indications are, the economy will turn around," he said. "We're OK for this season. To speculate about next season would just be speculation."
True enough, but the reality is that the Penguins are just one of 30 teams in the joint venture that is the National Hockey League, and the fiscal health of the entire operation hinges, at least in part, on how each of its members fares.
The most conspicuous example of that is the NHL's salary cap, for which the ceiling and floor are adjusted each year on the basis of league-wide revenues during the previous season.
If tickets sales and, to a lesser degree, merchandising sales decline significantly in enough markets during 2008-09, it's possible that the ceiling will not rise, and might even drop, for next season. And that could greatly compound the challenges faced by guys like Penguins general manager Ray Shero, whose payrolls already are hovering near the legal limit, and who must re-sign, or replace, players every summer.
Recently, while discussing his desire to re-sign forward Jordan Staal, who is scheduled to become a restricted free agent July 1 if he doesn't have a new contract by then, Shero flashed the wry sense of humor that he breaks out every now and then.
"I'm very comfortable that with the way the stock market is going, the cap is going to continue going up and we'll be able to afford all of these great young players," he said, forcing a smile.
Guess he didn't get the memo that all is well.
Actually, though, the variables that will determine how much the Penguins can spend on players, be they ticket sales in Nashville or merchandising activity in cities around the Southeast Division, are largely out of the team's control. Which probably is why Morehouse and other team executives are focused not on those numbers, but on the ones that directly reflect the interest level in their particular franchise.
"We've had all those indicators that we did so well in last year -- Web site hits, merchandise sales, our waiting list, our rate of growth ... ticket sales you can't gauge, because we've already sold them -- that we're watching," he said. "We're looking at television ratings, things like that.
"As far as the economic indicators, it's ticket sales and sponsorships. And for this year, there's no way for us to have any indication [because they've already been sold]."
Of course, if the economic crisis gets bad enough, TV ratings might decline because people have to sell their sets. Or can't afford the electricity to power them.
Should that come to pass, however -- and Morehouse couldn't be more adamant that he doesn't see such a bleak scenario coming -- it safe to assume that salary-cap issues won't be a pressing concern for anyone.
"I think the economy is going to turn around, and I think we're fortunate that we were already insulated for this season," Morehouse said. "But if it doesn't turn around, we have bigger problems than hockey."
The NHL really does care
Precedent suggests that teams which open the season overseas tend to suffer in the standings for it -- the New York Rangers 5-0 start notwithstanding -- but the Penguins have had the most favorable schedule imaginable since playing a pair of games against Ottawa in Stockholm two weeks ago.
They played the second of those games with the Senators on a Sunday and were off until the following Saturday, at which point they began a four-game homestand that didn't end until last night.
What's more, the league, by design or otherwise, consistently matched them against teams that had played the previous evening.
That includes Toronto, which was at Mellon Arena last night after playing at Madison Square Garden the night before. New Jersey and Philadelphia also faced the Penguins 24 hours after playing elsewhere.
The prevailing sentiment in hockey is that a club has a decided advantage when it gets a night off before facing an opponent that has to play, especially if that opponent has to travel.
The Penguins, it should be noted, have not played on consecutive days since getting back from Europe, and won't have to until Nov. 28-29.