NHL Lockout 2012: The Die Is Cast On Hockey's Massive Gamble

Saturday night, the National Hockey League entered its third lockout and fourth work stoppage of the last 20 years, failing to reach an agreement with its players' union by 11:59 p.m., when the latest collective bargaining agreement expired.

Now, where does the game and its fans go from here?

One thing to keep in mind is that this lockout - even if it doesn't go as long as the ones in 1994 and 2004 - could potentially bring a lot of damage to the game's revenue stream.

There seems to be a strong sense the league is trying to get a similar positive outcome that NBA owners got from their lockout of 2011. That particular dispute resulted limited damage to the game's business, but it also netted owners a more favorable split of revenue and an increase in revenue sharing among teams. The league shut its doors until Christmas Day, losing 16 games off the schedule per team but not suffering a lot of long-term damage to its product.

However, the NHL's situation is a bit different due to the frequency and substance of their labor disruptions, and this one contains some pitfalls for both sides should they choose to look for a fight rather than a settlement.

While the NHL has a devoted fan base, there is an element that is fatigued with these developments. After seeing the 2004-05 NHL season go up in smoke to get an economic system touted to secure the game's financial future in place, another work stoppage isn't going to be viewed quite as sympathetically by fans who buy the tickets, merchandise and other revenue items. The salary cap was sold as the stable solution to the league's economic problems.

It legitimized the sport among fans, who invested their time and money in a league that appeared to be growing. Fans came back after the last lockout, boosting attendance figures and league revenues along the way, and put the league on track to make inroads into America's mainstream sports conversation.

And now, after trumpeting record revenue last season - $3.3 billion, up from $2.2 billion just after the last lockout - the league made an abrupt U-turn this past month and suddenly pointed to a $240 million loss by its member clubs.

With a growth product, putting the brakes on could be a risky move, as some of the fans who either came back after the lockout or adopted the sport since might not be quite as charitable this time around. While the core fan base is among the sports world's most devoted, the fan base now isn't the same as it was eight years ago.

Cities like Boston and Chicago have embraced their Original Six clubs again, while cities like Washington, Pittsburgh and Los Angeles are embracing their clubs like never before. Growth in these markets is helping to grow television ratings and the league's overall profile, and selling even more tickets and merchandise.

Another major factor is the relative lack of warning to its customers of this pending dispute. Just this May, NHL commissioner Gary Bettman laughed off the mere mention of the lockout when holding a press conference at the Stanley Cup Final, intoning the mere thought of another stoppage was a media creation rather than a reality. Bettman now finds himself overseeing the third lockout of his tenure as the head of the league.

It's very important to note that the NHL was up front with its fans in 2004, warning of the potential of a long work stoppage months before it actually took place, making sure those fans who renewed their tickets knew they could be without the game for a while. This time around, the league was slow to get its fans up to speed on the lockout's potential - some teams did not even acknowledging the possibility until days before the lockout.

Now that training camp sessions and preseason games will soon be cancelled, the news certainly will not be welcome to the general public. Season-ticket holders made their commitments with their hard-earned dollars weeks or months ago in a slumping economy, and many did so without thinking a work stoppage would be possible - particularly after the league lost an entire season eight years ago to prevent this very thing from happening again.

In the NBA's case, their lockout officially started in the summer - the NBA CBA expired on July 1 - making fans aware of what was going on months before the season was actually going to open.

Another big difference between 2004 and 2012 is Donald Fehr, who can't be overlooked by the owners. With the NHL having essentially broken the NHLPA in 2005, players don't want to seem like they are pushovers a second time around. While getting a "win" over the NHL owners is difficult, the perception of standing their ground is an important aspect of these talks for the players.

While normally this would be the time the NHL sells its stars with a media tour around New York to promote the upcoming season, the league now finds itself in damage control less than four weeks before the scheduled start of the regular season.

And now, angling for a bigger piece of the pie, both sides failed to come up with a solution, earning ridicule and scorn from the general public and media, not to mention anger amongst the sport's loyal fans.

Quite simply, this dispute centers around the distribution of the league's revenues, and while $3.3 billion is a lot of money to divvy up, trying to gain a point or two in that split likely won't earn a whole lot of sympathy from those who are pouring the billions of dollars into the league's coffers.

As I've written in this space before, it seems like both sides were content to let this negotiation reach the lockout stage. The league and union seem to believe they can cut a better deal for themselves in a vacuum, so the agreement was allowed to pass without a lot of serious talk about installing a new one.

The NHL had seen its business grow by $1.1 billion since the last lockout, and is placing that growth at risk with this latest action.

Now that the lockout has officially arrived, the league and its players union owe it to the fans - who supply those dollars that fuel the industry - to find common ground on revenue quickly. The NHL has gained the unwelcome title of most unstable major sport in North America, as even baseball - which was rife with player strikes until losing the World Series in 1994 - hasn't lost a game to a labor dispute since 1995.

The competition for the sports dollar in North America is fierce, particularly in a sluggish economy, and since the lockout, the NHL has weathered the storm well. But now the league is making a gamble that the sizable gains made over the last seven years will endure another lockout.

If the two sides can settle quickly, the damage should be light. But another protracted lockout could convince a number of fans to take their interest - and dollars - elsewhere.