Disney, NHL to Profit by Teaming Up : Marketing: New franchise would offer lucrative tie-ins for hockey league and leverage for Disneyland expansion.

By THOMAS S. MULLIGAN and CHRIS WOODYARD

Dec. 14, 1992 12 AM PT

TIMES STAFF WRITERS

With Walt Disney Co. planning a $50-million investment in a new National Hockey League team in Anaheim and Sony Pictures Entertainment said to be showing interest in the basketball Lakers, the sporting and entertainment worlds are moving ever closer together.

Under Disney’s plans, the NHL franchise in Orange County would be a vehicle for selling everything from package vacations to Disneyland to team jerseys at the nearest Disney Store. Movie-style “trailers” could promote the team and the sport in theaters where Disney films are shown. Disney-owned KCAL-Channel 9 would likely broadcast the team’s games.

Hockey executives hailed the deal as the possible salvation of the NHL, the most backward of the major professional leagues in its promotional efforts.

“We’re going to be watching everything Disney does very, very closely and try to learn as fast as we can,” said Pat Forciea, marketing chief of the Minnesota North Stars. “We’re all going to grab hold of their coattails and hopefully take a long, long ride.”

Disney isn’t the first company to see business opportunities in the marriage of sports and entertainment.

* Paramount Communications Inc. owns the NHL’s Rangers, the National Basketball Assn.’s Knicks and the teams’ home arena, Madison Square Garden. It also owns MSG Network, the cable-TV system that carries games of the Rangers, the Knicks and baseball’s New York Yankees.

* Cable-TV magnate Ted Turner owns Atlanta’s baseball Braves and basketball Hawks and has used both to provide sports programming for his WTBS cable superstation. Tribune Co. feeds its superstation, WGN, baseball broadcasts of the company-owned Chicago Cubs.

* Sony’s movie unit, sources said, is exploring the purchase of the Lakers and their arena, the Great Western Forum, both owned by Jerry Buss. The other partner in the discussions is Bruce McNall, whose Los Angeles Kings hockey team is the Forum’s other main tenant, the sources said. None of the parties would comment on the negotiations Friday.

But regardless of whether Sony makes a deal, Disney is expected to set new standards for sports marketing.

“In sports, a lot of teams have tapped out of things they can do to promote themselves,” said Lon Rosen, the Los Angeles-based sports agent who represents Magic Johnson. “But with Disney there’s so much more they can do in terms of cross-promotion and marketing. Disney has the mouse by the tail, so to speak.”

The NHL was so eager to have Disney in the league that it sought out the investment and made some major financial concessions to secure the deal. Under league rules, Disney had to compensate McNall for bringing a new franchise into his region. The NHL allowed Disney to include the $25-million payment to McNall as part of its $50-million franchise fee. The remaining $25 million will be split among the other team owners.

Aside from its marketing potential, the deal holds enormous benefit for Disney in its dealings with the city of Anaheim, where the company is trying to win up to $1 billion in public financing to build its $3-billion Disneyland Resort expansion.

Because the city badly needed to find a professional hockey or basketball team--or both--to fill its empty arena, this gives Disney an improved negotiating position.

“It ingratiates you enough to (get the city to) build the infrastructure for the second gate,” said analyst Emanuel Gerard of the investment firm Gerard Klauer Mattison in New York. Having won nearly $1 billion in construction concessions, “It doesn’t matter if you lose $5 million a year for 20 years” on the hockey team.

The deal “ties into our long-range hope to make Anaheim a destination resort city,” Disney spokesman Tom Deegan acknowledged. “The hockey team is another package under the resort tree.”

Disney could also derive untold benefits from having its name plastered around the ice rink where even television channel switchers would be sure to see it.

“The bottom line becomes if you put together a team that is successful over a period of time, the benefits to Disney could be enormous,” said Jeffrey Logsden, an entertainment industry analyst for the brokerage of Seidler Amdec Securities in Los Angeles.

Here are some of the specific ways Disney might market its new franchise.

* Merchandise. Selling team paraphernalia has become as big a business as filling the seats. Witness the popularity of baseball-style Raiders jackets or L.A. Kings knit caps. Hockey’s San Jose Sharks became legendary before they ever reached the rink: their logo--a shark snapping through a hockey stick--was considered so fashionable that items were snapped off the shelves.

Disney also has a retail distribution network any team would envy through its Disney Stores and merchandise counters at the theme parks.

* Movies. Walt Disney Studios released “The Mighty Ducks” this summer, a movie about a kids’ hockey team starring Emilio Estevez, that pulled in $50 million at the box office. In announcing the hockey deal on Thursday, Disney Chairman Michael Eisner gave the movie a plug by saying he favored the Mighty Ducks as a team nickname.

* Theme parks. In Florida, the expansive Walt Disney World resort offers a variety of nighttime attractions like themed restaurants and saloons. In Anaheim, a hockey franchise would give Disney a chance to develop its first nighttime activity. It could sell tour packages based on a day at Disneyland and a night at the game.

* Hotels. Hockey is played in the winter months, when the Disneyland Hotel and several small Disney-owned motels would have plenty of rooms to fill.