Leonsis confident signing was the right move for Caps

No matter how this all ends in Washington, in Stanley Cup glory or in bitter disappointment or ultimately with the arrival of moving trucks bound for Kansas City or Las Vegas or even Hamilton, no one will ever accuse Ted Leonsis of not putting it all on the table.

The owner of the Washington Capitals has wagered $124 million that over the course of the 13-year contract extension Alexander Ovechkin signed Thursday the Russian star will prove to be the kind of player who will not only leads his teammates to playoff glory but will captivate fans in an unprecedented fashion.

Leonsis has wagered the richest contract in NHL history that Ovechkin can make Washington the kind of hockey town few believe it can be.

"At some point we have to face facts here," Leonsis told ESPN.com on Friday morning. "If we have a great team and we win a Stanley Cup and we've got superstar players and an innovative marketing strategy, which I think we have, and we can't sell out, then we have to say we have a market problem."

"I don't know what I'll do about it," Leonsis added. "But we're not there yet."

Not yet. Maybe not ever.

But on Thursday Leonsis took a bold step to maintain control over his assets and to ensure that whatever happens down the road with this oft-maligned team that he has dictated the course, not someone else.

Thursday's signing of Ovechkin to a 13-year, $124 million contract extension that brings with it a cap hit of just over $9.5 million a year, signals to the fans that Leonsis is a man of his word.

The owner, who made his fortune with AOL and has many interests including documentary film-making, told season ticket holders in the fall that Ovechkin wasn't going anywhere even though Ovechkin was slated to become a restricted free agent in July.

There is little question given the events of last summer that had the Caps dithered on extending Ovechkin's contract, another team (let's say the Los Angeles Kings for instance) would have plunked down a monster offer sheet.
The Caps would have immediately matched any offer sheet but then, Leonsis pointed out, he would have been allowing another team to negotiate with his assets.

As it is, Leonsis and Ovechkin started out discussing a six-year deal at $9 million a season that was similar in term and value to the contract extension signed earlier this year by the game's other iconic star, Sidney Crosby. Then the Caps looked at the fact Ovechkin, who turned 22 in September, would then be eligible to become an unrestricted free agent before turning 29, pretty much at the prime of his career.

"So we said to him, 'Why don't we negotiate your free agent deal right now,'" Leonsis said.

So they looked at the free agent deals signed by top players last summer and came up with an additional seven-year term at about $10 million a year.

"I think that in six years, $10 million will look pretty reasonable," Leonsis said.

Perhaps. As long as the Canadian dollar remains strong and if U.S. television ratings continue to creep up and merchandising sales continue to climb, there is little reason to believe the salary cap will do anything but continue to increase a modest amount each year.

As long as the long-term deal doesn't take the edge off Ovechkin's play -- and there is little in his character to suggest this would be the case -- the money isn't going to be an issue.
The bigger issue for the Capitals is whether any of this will matter in a market where hockey has never really mattered.

The Caps are averaging 13,643 through their first 20 home games, down about 300 per game from last year (the team gives away a small number of tickets, about 800 per game). They drew 16,168 Wednesday night against Colorado, a nonconference opponent, and attendance has historically gone up after the NFL's Redskins are done.

That level of fan support means Leonsis will continue to lose money even with the hard cap that was supposed to make markets such as Washington viable and even with one of the game's most exciting young players.

Leonsis can live with that because he believes the team is on the right track with a clutch of emerging stars all under the age of 25, and he believes that as the team gets better and becomes a contender, the fans will come.

Aside from Ovechkin, of course, there is Alexander Semin, 23, who signed two-year extension this season. Nicklas Backstrom, 20, is in his rookie season and showing signs of being a front-line player after a slow start. Mike Green, 22, is enjoying a break-out year and is tied for the goal-scoring lead among NHL defenseman with 11 and will be due a whopper pay raise as a restricted free agent this summer.

After a slow start, attributable in large part to injuries, head coach Glen Hanlon was fired and replaced by longtime minor league coach Bruce Boudreau. The team has responded and as of Friday morning was in 13th place in the Eastern Conference but just four points out of the final playoff position.

Under Boudreau the team has re-established its identity as a feisty, hard-working bunch that appeals to the small but hard-core fan base.

That wasn't always the case.

A decade ago, the Caps went to their first and only Stanley Cup final.
They have not won a playoff round since.

In an effort to gain some traction from that lone playoff run, Leonsis acquired five-time scoring leader Jaromir Jagr from Pittsburgh during the Pens' fire sale in July 2001. Although Jagr had two years left on his deal, Leonsis said Jagr's agent told him he wanted to re-negotiate an extension or else Jagr would announce he would leave the team at the end of the deal. The Caps signed Jagr to a seven-year deal worth $11 million a season.

They're still paying for it even though Jagr's been a New York Ranger since late in the 2003-04 season.

"You live and you learn," Leonsis said. "I let an agent put a gun to my head."

Certainly the fans didn't warm to either Jagr or the team. The low point came in the 2003 playoffs when the Caps built a 2-0 series lead against Tampa and then lost four straight while fans stayed away from home playoff games in droves.

"That was very disappointing," Leonsis acknowledged.

So, how is the Ovechkin experiment any different?

Financially it might look the same but from the team's perspective they are worlds apart.

"We didn't really get a chance to see how he would mesh with the team," Leonsis said of Jagr.

And Ovechkin?

"We know him through really bad times. We've been through fire together," Leonsis said. "I couldn't think of a better face for our franchise.

"Our fans love Alexander Ovechkin. Our fans didn't love Jaromir Jagr."

Whether the fact that Ovechkin is a home-grown talent, or the fact he signed on for a 13-year tour of duty with the Caps of his own volition, makes any difference to a hockey market that has distinguished itself with its own indifference, is unknown.

The only thing that is for certain is that Leonsis won't have to worry about second-guessing himself, even if it cost him $124 million for that satisfaction.

"You can talk to me after we win a Cup," he said.

Fair enough.

Scott Burnside is the NHL writer for ESPN.com.