Today's St. Pete Times had an article about the Lightning's projected total salary for next season as well as the fact that the operation continues to produce a net loss:
Feaster said his preliminary budget for next season is $40-million. That is about $4-million less than this season and could be up to $9-million below the yet-to-be-set league salary cap.
Coaches and players said this is no time to pull back, though CEO Tom Wilson said Palace Sports will lose $9-million on its Tampa operation this fiscal year.
http://www.sptimes.com/2007/04/24/Lightning/Payroll_snip_could_cu.shtmlI can think of four possible solutions:
A) Stay the current course, continuing to lose money and putting a competitive team on the ice
B) Cut costs big time, eliminate your loss, but put a bad team on the ice
C) Invest money in the whole Tampa operation (the Lightning and the facility's other uses), be willing to take net losses in Tampa for a few years while developing your product in that market, and potentially become profitable 3-4 years down the road
D) Sell the team to someone who is willing to invest in the operation and not treat it as a red headed step child
I personally believe that Option A is completely irresponsible from a business standpoint. You can't have an operation that is continuously losing money being buoyed by other profitable operations within the company. From a competitive standpoint, Option B is downright moronic, and while it might help right the financial ship, it doesn't make much sense to completely kill your product to do so.
Option C and D are both acceptable solutions. Currently, the Detroit operation for Palace Sports and Entertainment is extremely profitable, so it can offset the losses in Tampa for the time being. This is an organization that worked hard to build the empire that exists in the Detroit area, and they could commit to putting the same effort and resources into Tampa. On the other hand, Bill Davidson has NEVER really cared about the Lightning, so from his point of view, why should he invest more money in Tampa? If that is how he truly feels, I think the correct action to take is Option D. Any thoughts?
