Panini has until June 30th to complete their NHL/NHLPA license. Following that, Upper Deck will take over as the sole licensee for the next few years, at least. While the exact length of the deal wasn't announced, it is for multiple years.
Russ Cohen spoke with Adam Larry, Director, Licensing and Associate Counsel for the NHLPA, about the new deal.
Cardboard Connection: So, Adam, everyone wants to know, why? Why the return to an exclusive licensee for hockey cards?
NHLPA: From an NHLPA perspective I wouldn't say it was something we were looking for. We started our diligence process a number of months ago, probably six months ago. What we were looking for at the end of the day was the best deal for the industry. That goes for collectors, distributors, manufacturers, licensees and licensors. And from a PA perspective, it was the best deal for the players as well. We didn't go into this saying we're going to an exclusive. We'll do our diligence and figure out what the best deal is for the players and the industry.
Cardboard Connection: So did Panini do something wrong? Were sales lagging?
NHLPA: At this time, looking at all the variables, we felt this was the way to go. It wasn't anything that Panini did wrong. Moreso, what Upper Deck had and what they could put into an exclusive like Ice and MVP. They've been kept alive in subsets but collectors have wanted to see them in full sets. We had a limit on the number of brands both companies could put out with the semi-exclusive.
Cardboard Connection: You have to hand it to Upper Deck. Even when they were losing some licenses they never lost the NHL license and now they have a chance to build it back up.
NHLPA: We feel those brands that Upper Deck will add are strong and they are what collectors will want. It was a combination. If it was just a dollar figure then I don’t think Marty (McQuaig, Manager of Retail Licensing at the NHLPA) and I would have had to do our due diligence and my wife and kids would have been a lot happier.
Cardboard Connection: So what overall changes will we see next season with the hockey card industry?
NHLPA: It was really looking at the calendars and products and we were hearing there may have been too many products out there and a flooding of the market. Upper Deck will speak to their release calendar in 2014-15 but there will definitely be less brands coming out. It's important to collectors and hobby store owners to sell through the releases that are out there and help the product get through the marketplace. Basically, creating a much more vibrant, stronger market out there. With this exclusive we'll be able to do that.
(Panini) did put out some good products. It was a very tough decision. We felt that some collectors will be very upset, or somewhat upset, so we made what we thought was the best decision for the industry. At the end of the day, the hockey card market will have a new focus and just one manufacturer. But that doesn't mean Upper Deck won't continue to put out quality products, because they will. As we know, they are always on the cutting edge when it comes to technology so something tells me something big in that area is coming down the pike and maybe that's why they got the exclusive once again.
Cardboard Connection: Can you explain the reason for the timing of the announcement?
NHLPA: We want a healthy release calendar. We're not looking to squeeze every last dollar out of this even if it means there aren't record earnings in the PA's coffers, announcing it now was the right time. We just concluded negotiations and wanted to get the information out there in a timely fashion.
2014-15 should make for a very interesting year in the hockey card landscape. Ultimately, it will be collectors who decide with their wallets, if the right decisions were made.