Can boxing business make a comeback?

February 14, 2012

Kevin Iole of Yahoo! Sports posted an article on the need for HBO and Showtime to rethink its boxing business model. Iole points out that both networks are overpaying for license fees for its fights and a rethinking its business models may help the business.

Unlike the UFC pay issue, Iole points out that some fighters are being overpaid and not producing for their paycheck.

Via Yahoo! Sports:

The problem from a fan’s perspective, of course, is that far too often the boxers earn exorbitant purses for fighting ordinary, at best, competition. And that gives them less incentive to take on a stiffer fight in the future.

Iole points to HBO’s acquisition of the rematch between lightweights Lamont Peterson and Amir Khan. While its expected that most tickets for the Mandalay Bay will be comped, both fighters will make over $1 million.

The challenge is putting on compelling fights that fans will want to see. Iole believes making the fights are difficult due to the fighter paydays. Both HBO and Showtime are looking into ways to market boxing and present compelling television.

Iole suggests the following:

Only pay the fighters who are willing to take tough bouts; who perform when they get those big matches; who sell tickets on a regular basis.

Then, whatever money they save in salary, they can pour back into the sport by developing support programming that will actually help fans identify with the athletes and want to watch them compete.

Payout Perspective:

Its interesting that Iole’s suggestion is similar (not the same) to the UFC model. I don’t think I see this happening considering Showtime’s renewed interest in boxing and its hope to supplant HBO for big fights. One of the things that boxing needs to do is to introduce fighters to the public; present compelling stories so that viewers are drawn to watching their fights. NBC Sports Network is attempting to do this with its quarterly Fight Nights. We will see if Spike TV does something similar for its boxing programming (if it comes to fruition).

The other, of course, is to make the fights people want to see. (e.g., Mayweather-Pacquiao). Obviously, the promoters are the other factor in this equation which is a definite roadblock to a retooling of the boxing business model.

With HBO and Showtime actively competing for big events and offering top dollar plus the added benefit of utilizing the full force of its network partners for marketing and promotion, boxing could make a comeback. We’ll have to wait and see on how each will proceed.

18 Responses to “Can boxing business make a comeback?”

  1. George Cruz on February 14th, 2012 11:14 PM

    Boxing is dead; plain and simple; soon Manny will retire and become President of the Philippines. Mayweather will get knocked out by Cotto and lose his legacy. All the other fighters that remain, nobody really cares about them. Nobody cares about the Klitchko brothers except the Europeans. Here’s what I like; I don’t pay for a $65 pay per view; if I hear the fight was good, if it’s an HBO fight, then I just wait until the following weekend and watch it for free. If it wasn’t good, then I don’t bother watching it. As a former boxing fan, and dedicated UFC fan, plain and simple I enjoy being entertained by world class athletes and organization; boxing does not know how to put on good fights, except for maybe once or twice a year. That’s pathetic; gone are the good old days of Ali, Frazier,Tyson, Lennox, Leonard, Hearns, De La Hoya, Trinidad, etc. It’s done; last call; it’s wrap! May boxing rest in peace and thank you for the memories.

  2. BrainSmasher on February 15th, 2012 7:32 AM

    I think everyone has heard me say that many times on here during Pacman/Manny Articles. Its an example of how money ruins fighters and the sport. Rich people dont want to get the hell beat out of them. They will take the path of least resisitance and no longer fight with something to prove. They lose what made them a fighter and they become a businessman. Taking a tough fight for 50 million when you can get 30 million for a sure thing and ensure many more paydays is not smart business.

    Yahoo is right but it will never happen. IF Showtime and HBO start shor changing the boxer they will find someone else to take their place and air the fights. It may be something they can enforce on young fighters they create and lock into long term deals but not the big names of today.

  3. Machiel Van on February 15th, 2012 8:06 AM

    “The challenge is putting on compelling fights that fans will want to see.” This is what’s killing boxing. The boxing sport/business complex won’t allow for it.

  4. Machiel Van on February 15th, 2012 8:06 AM

    Wow, I guess this is the place for BOLD statements today 🙂

  5. ChrisC on February 15th, 2012 9:28 AM

    If the sport tanks real hard, it could happen. I love boxing, but it has to change.

  6. CAINtheBULL on February 15th, 2012 2:55 PM

    The sport of boxing is still great.
    The business model of boxing is garbage.

  7. Diego on February 15th, 2012 3:47 PM

    Yeah BS, it’s terrible when men who risk their lives earn a lot of money. Good point.

    The Peterson-Khan example is a bit off from Iole’s main point. That fight is the rematch of a very good and controversial clash. The fact that they earn north of $1M is justified by the talent and resumes of the fighters. If those salaries are not sustainable due to lack of fan interest, to me that shows the difficulty boxing is having creating branded fighters.

    Bradley blatantly ducking Khan, crushing the can that is Casamayor and getting rewarded with a shot at Pacquiao in a fight no one cares about is a more apropos example of what Iole is referring to.

    What the UFC does differently than boxing is not pay their fighters less (although arguably that is the case) it’s create a brand around the UFC and around certain fighters that drives revenue – they do that by forcing guys to fight each other and investing in Primetime and Countdown shows that allow fans to get to know the fighters and keeping strict control over even productions, so they can highlight up and coming fighters.

    Diaz and Condit probably got paid roughly what Khan and Peterson will make for their fight – the difference is that the UFC card did solid PPV buys and $2M+ at the gate while the boxing card will wind up on HBO and the arena will be heavily papered because no one cares about those fighters.

    Simply having the UFC or boxing promoters pay the fighters less will not make either sport succeed.

  8. Jason Cruz on February 15th, 2012 8:38 PM

    @diego: Fixed the boldness 🙂

    I think that Peterson-Khan will be a great matchup considering Khan seemed to be the “next big thing” but was upset (albeit controversial according to some) by Peterson. Why you take a fight in someone’s hometown when you are the attraction made no sense.

    But, it seems like boxing is just running into great fights like Peterson-Khan and Berto-Ortiz I with little fanfare. I think there needs to be more visibility for these fights but I’m not sure what will work.

    Once again, I go back to the fact that the Heavyweight champ rarely fights in North America as a huge problem.

  9. Mossman on February 15th, 2012 9:18 PM

    uh… hello? How about the fact that promoters have killed this sport indefinitely??? why are there 7 different titles each at 14 different weight classes??? Thats why fans dont care anymore, its too hard to follow. Thats why Dana and the Fertittas simplified the process for the UFC and why they are indeed a monoply buy-ing out and destroying everyone else… cause fractioning the perception of the consumer is BAD!!!!

    in the end it was all about the money. everyone thought they could just invent new governing bodies and a new slew of championship belts and they caused a glut, fractioning of the talent choosing one promotion over another and everyone just wanted to get paid…

    bad business.

  10. BrainSmasher on February 15th, 2012 9:45 PM

    Diego on February 15th, 2012 3:47 PM

    Yeah BS, it’s terrible when men who risk their lives earn a lot of money. Good point.
    ……………………………………………………..

    Arent you the little drama queen! These guys hardly risk their lives. 90% of the world have more risks in their job than these guys. Maybe you should train the sport first hand and educate yourself. Buy your moronic logic Police would be getting 1 million per year as would fire fighters. They risk their life. Fighters are not risking their life and more than the average person.

    Also i never said they shouldnt earn a good living. But when you are haggling over millions or hundreds of thousands for a days work and there is clear evidence that it effects the quality of the sport and the fighters. Then my stance as a fan makes a whole lot more sense than your stance. You only hurt yourself with your stance. You get a weaker product just so someone you will never meet has an extra few zeros on his pay check. My stance gives me a better product for my money and entertainment. I guess its as simple as me liking the sport and you liking the men. But that doesnt mean my stance makes any less sense no matter how dramtic you make it seem. Fighters have been fighting in this sport much longer than you been watching it and it was always much more dangerous. Yet none of them needed to be paid millions to fight. The fighters today not either.

  11. Sampson Simpson on February 16th, 2012 10:52 AM

    You guys are laughable.

    Nobody cares about the Amir Khan vs. Lamont Peterson fight?

    You guys do know that Khan has 500,000 followers on Twitter and Facebook which trounces 99 percent of the UFC roster by far.

    The first bout between Peterson and Khan generated 1.5 million live viewers on premium channel HBO.

    Who knows how much money was generated in the Canada and UK for the bout.

    Easy to think small (only America)… it’ll take time to realize boxing is bigger than MMA by far on a global scale.

  12. Diego on February 16th, 2012 1:00 PM

    Sampson,

    How did the fight do in terms of gate? How much money did the fight make from TV? Viewership is nice, but how much did the various networks pay to air the fight? I’m not trying to be an ass, I’m actually curious. I suspect that the UFC Diaz v. Condit card pulled in substantially greater revenue but it would be interesting to compare. Certainly if HBO thought there was a snowball’s chance in hell that Khan-Peterson would pull in 400k PPVs they would not have shown it on the subscription channel but would have made people pay $55 for the pleasure of watching it. I watched it, but am not sure I would have paid for it. I will not be paying for

    BS,

    That’s your most ignorant post in a while and as usual you rely on strawman arguments. If I disagree with you that means I must never train boxing or MMA and I must be a newbie who knows nothing about the sport. And yes I was being dramatic because you’ve never been one to understand subtlety. Good job catching it!

    Boxers, kickboxers, mixed martial artists and participants of most other contact sports (football, rugby etc.) frequently leave themselves physically damaged and take years off their lives after their competitive days are over. I don’t think that’s true of 90% of the world as you ignorantly claim. They also don’t have transferable skill after they retire unless they open a gym (not everyone can do that) or go into coaching (again not everyone can do that) that means they have to earn a lifetime’s worth of money in a few short years and they should expect high medical bills down the road. That’s why I feel they are risking their lives and deserve top dollar.

    Furthermore, paying top dollar draws top talent. Look at the people competing in MMA today versus 15 years ago when salaries were much lower. If you lower salaries back to what they were 15 years ago, you will get the quality of fighters we had 15 years ago. Namely, a few guys who are good, and a huge number of amateur level fighters. As salaries continue to increase the sport will draw even greater and greater talent. Imagine a time when guys go to the NFL only because they can’t make it in MMA instead of the reverse as we see it today. Or Brazilian fighters will only take up soccer when they can’t make it in MMA. I don’t think the sport will ever get there, but just consider the talent pool MMA would have. That won’t happen with low salaries.

    You failed to address my point so I will make it again – it’s not high salaries that are hurting boxing, and they won’t hurt MMA either. It’s lack of promotion and investment in the sport. It’s short-term thinking among boxing promoters which stems from the fact that there’s so damn many of them that no one wants to invest lest another promoter somehow benefit.

    With that said, I don’t think boxing is not dead and I don’t think it will die. Nor do I think the future of boxing rests on the ability to make the Pacquiao-Mayweather fight happen. There are still lots of fans, lots of fighters and lots of money. Boxing in the US was one of the earliest sports practiced professionally and will be around for a long time to come.

  13. Diego on February 16th, 2012 1:08 PM

    Edit: End of 1st paragraph I meant to say I will not be paying for Pacquiao-Bradley.

    Though I reserve the right to change my mind on fight night.

  14. Weezy on February 16th, 2012 3:08 PM

    Attendance for Khan vs. Peterson was approximately 8,600 and I’ve heard that the live gate was around $850,000 (maybe just over that). I think they got around 1.6 million viewers on HBO. For comparison, a UFC event around that same time in that same city (Washington, DC) pitted Dominic Cruz against Demetrious Johnson. That event had 9,380 in attendance with a live gate of just over $706,000. It had 789,000 viewers watching on Versus. Diego is correct about the large television money from the U.K. That is what made the difference and where most of the revenue to put on an Amir Khan fight comes from. Boxing definitely holds the edge in international viewership, no question, with the Klitschko brothers fighting in front of the biggest television audiences in boxing (over 16 million people in Germany watched Wladimir’s fight with David Haye). I will say, however, that Zuffa made big gains in the past year in regard to that category with over 20 million viewers watching Dos Santos vs. Velasquez and 23 million watching Aldo vs. Mendes. Zuffa’s focus over the next year is to get a television deal in India and also increase the visibility of the sport in China. If they can crack either of those markets, then we’re talking about a different conversation as to worldwide popularity. Time will tell if that comes to fruition, though. As of now, MMA is the more consistently high performer in North America and Brazil but boxing outperformers it most everywhere else.

  15. Sampson Simpson on February 16th, 2012 4:46 PM

    It’s not HBO’s decision to ever put anything on PPV for the most part.

    It’s up to the promoter and fighters putting on the event to project whether a fight would do better revenue wise on PPV rather than a set fee from HBO.

  16. BrainSmasher on February 17th, 2012 4:06 PM

    Diego.

    There is no one in MMA todays who got into it for the money. The only person one can argue got into it for money is Brock Lesnar. Everyone else was training in the sport before anyone was ever making money. The only reason people get into fighting is because of the glory. The more popular it is the more people want to do ti. Everyone now would love to “An Ultimate Fighter”. Its respected. Money is nice and it makes it easier for people doing it. Even former NFL guys like Shuab are crossing over because it is a respected competition. Not because of the pay..

    Also you specifically said they risk their life, not health. That is igorant because there has only been 3 deaths in the world history of MMA/NHB. As for health that is debatable. long term effects of contact sports are still being researched. even still people are hurt in their work every day. You can put fighters and sports personalities on a pedastol all you want in your mind but it doesnt change reality. There is workers comp and disability numbers for employment to show all work is dangerous. People become disabled in many professions. As for their work only allowing a small window to make a living. That is their chosen profession.They should prepare themselves for another career like even NFL players do. The sport should not risk its existance just because a few fighters want to work a few years and sit in the lap of luxury the rest of their life. If NFL players who make millions can get their education, finish their playing career and go into running companies and broadcasting. Then fighters are no different. Also my brother blew his knee out playing college football. He never got a dime. He didnt play for money and played dispite the risk. Taking risk doesnt entitle you to making lots of money. You are trying to put the two together when they dont gotogether in any part of reality. In the real world you make what your earn or bring to the table. In the UFC the thing that brings the most money to the table is the UFC brand. All the guys who are good but dont have a following shouldnt be able to demand pay based on fans the brand name brought in. If you dont put ass’ in the seats or sell PPVs then you shouldnt get paid. The risk is just a ploy for people to cry about wanting more. You can never put a price on health or life. So it is stupid for anyone to claim they deserve anything based on those. Even Tito who was making millions a year was claiming he should get more because the risks he takes. If that was the case then everyone should make the same amount. But they dont. Risk has nothing to do with pay.

  17. Diego on February 20th, 2012 12:37 PM

    Wrong. On so many levels that it’s ridiculous.

    Shaub didn’t cross-over from football. He couldn’t play football anymore and decided to take up MMA. I guarantee that he’s doing it in large part for the money. Without the money you can’t draw the talent. Sure, you can draw guys who want “glory” but those guys can get as much if not more glory on the grid-iron or the soccer field. To suggest that glory alone will keep MMA stocked with talent is absurd. You need money to pay for talent.

    So sorry that I wrote “life” instead of “health”. Wow, you got me. As for the detrimental effects of getting punched in the head on health, they are not debatable. So I’m not going to debate them with you.

    Your examples of worker’s comp are absurd, but I’ll go ahead and use them against you. There is no worker’s comp in MMA. There is also no retirement package. That means athletes have to make enough money in a handful of fights to cover possible injuries and retirement. Hence they need to get paid much, much more than someone who gets both worker’s comp and a retirement package.

    Your examples of future careers for fighters are also absurd. How many NFL guys do you know running companies? And if you spend 10 years in the NFL while all your classmates are climbing the corporate ladder, don’t you think that hurts your job prospects when you stop playing football? Companies like to hire people with relevant experience. So that leaves broadcasting – do you honestly think there’s enough broadcasting jobs for all ex-fighters?

    I never said that risk has something to do with pay. I said that people participating in the sport, have to weigh the risks against the rewards. My point, which you’ve managed to miss again and again is that without high pay, you won’t attract a high volume of high talent to a risky profession. Your point (as far as I can comprehend it), which is blatantly wrong and flies in the face of reason is that you don’t need high salaries to attract top talent, and in fact, high salaries will ruin the sport. Counter my main assertion if you want to continue this discussion. Otherwise I’m done wasting my time.

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