How New Ownership Will Affect the Toronto Raptors

James BorbathContributor ISeptember 13, 2012

Photo Courtesy of James Borbath/
Photo Courtesy of James Borbath/

The Toronto Raptors' ownership over the summer had a shake-up just like their roster. There is one major reason this should have an impact on their future. It can be summed up in one word: ratings. The Teacher’s Pension Plan wanted people to watch the Raptors. Rogers Communications and Bell need fans to watch in order to achieve full return on their shared investment of $1.32 billion.

A pension fund by nature is concerned with profits. They want safe investments with low risk. Rogers Communications and Bell own many media platforms that want content. In order for this investment to be a full success, having control of that content is not enough, it has to be compelling. In other words, they want people to be watching, reading and listening.

This is a result of advertising. When you hold the broadcast rights for both television and radio, you can turn a profit from selling advertising on these properties. The more successful a franchise is, the higher amount they can charge for that advertising.

Combined, the two companies have a monopoly on sports coverage in Canada. Rogers recently purchased the television properties of The Score, who at one time held rights to a portion of Raptors broadcasts. This purchase of MLSE eliminated any hope of any other broadcasters, outside of networks owned by Rogers Communications or Bell Media, from acquiring the broadcast rights.

Obviously, the Raptors are the secondary team in the MLSE purchase. The Toronto Maple Leafs franchise is the big piece of the puzzle. They are the driving force that makes this company what it is in terms of value. The M and L stand for Maple Leafs after all.

Still, that said, the Raptors could be the only ones playing this season. The NHL is in a similar situation to where the NBA was at this time last year.

If there is any kind of labor stoppage in the NHL, it would be a big opportunity to re-establish the Raptors brand. Something MLSE under the Teachers' Pension Fund failed to do when the NHL missed an entire season.

If you are skeptical that this company will change at all, you have every reason to feel that way. The failed pursuit of Steve Nash might be a sign of hope and proof of a new direction. Technically, Rogers was not officially part of the ownership group at the time. Bell was, but held a non-controlling interest. It is logical to think they were calling the shots or at very least consulted.

The Nash pursuit caught the attention of all Canadian sports fans. It was a sign that this group might indeed have a different agenda than the former ownership. While the people within the company remain for the most part the same, the boardroom, the ultimate deciders that are Bryan Colangelo’s bosses, has changed.

They could make changes in terms of the Raptors spending habits. The Raptors have been a team that, while promising they were willing to go above the tax threshold to improve, never did. Chris Bosh believed that for the Raptors (or any other team) to be competitive in the NBA they had to venture into the luxury tax to do so. He made those thoughts clear at his season-ending presser before he would leave for Miami.

I watched that conference, it was the one point Bosh got right on his way out the door.

Spend money to make money was never a philosophy used by the Teachers' Pension Fund. It might be a philosophy that the new owners of MLSE would be inclined to take. They want to make all of these franchises competitive and win. The Teachers' Pension Fund would make the same claim on many occasions.

The difference for Rogers Communication and Bell Media is they have motivation to win. If they win, the ratings will go up for all of their various media properties and that equals cash through advertising revenue and new media platforms

There is a direct motivation for these companies to have the Raptors be a winning franchise or at least a compelling one. The Raptors do not have an audience, like the Leafs, that will be engaged regardless of winning.