Pacquiao-Bradley II Payout Perspective

April 16, 2014

Welcome to a special edition of Payout Perspective.  This time we take a look at Pacquiao-Bradley II taking place at the MGM Grand Garden Arena.

Pacquiao ousts Bradley

It was even until the middle rounds when Timothy Bradley began to fade and Manny Pacquiao poured it on.  Bradley showboated a little and tried to feign he was not hurt by Pacquiao’s punches.  Either he was going to be a genius or he was trying to lose. Even when Bradley invited Pacquiao into skirmishes and attempted to emulate the same strategy as Juan Manuel Marquez with his KO in December 2012, Pacquiao seemed to win them and/or evade the big shot.

Pacquiao now faces the winner of Juan Manuel Marquez-Mike Alvarado on May 17th.  Most fans would probably like to see Pacquiao-JMM 5 because of the built-in storylines.  Their last battle drew 1.15 million PPV buys and would likely equal or eclipse that number.

Even though Pacquiao should face the JMM-Alvarado winner, the LA Times is reporting that the Pacquiao camp is lobbying for a shot at Mayweather.  Will this happen?  Don’t hold your breath.  However, the bargaining leverage is all with Mayweather.  Its Pacquiao with the reported money problems and he has been the one to concede the stricter drug testing and is willing to listen to a less than 50% split of a fight.  So, does that put pressure on Mayweather, or is this paragraph wasted time?  We have two different promotions and if you are Mayweather, only public perception would lead you to a fight with Pacquiao.  Does Mayweather really care about the public?

Attendance

Top Rank reported a sell out for the MGM Grand Garden Arena with 15,601 in attendance.  The weigh-ins a day earlier were at capacity as well with approximately 4,500 witnessing Pacquiao and Bradley weigh in and flex for those in attendance.

On Tuesday, the Nevada State Athletic Commission announced 14,099 tickets were sold for a total gate of $7.9 million.  H/t: Steve Kim


The gate was approximately $7,865,100 which is the lowest in years for Pacquiao.  The gate falls 24th on the list of top boxing gates for Nevada.  Pacquiao-Hatton in 2009 received an $8.8 million gate (15,368 in attendance) comes right before Pacquiao-Bradley II.

Payouts

It was reported that Manny Pacquiao and Timothy Bradley would earn $6 million each.  However, Bob Arum indicated that Pacquiao would make no less than $20 million.  Both would receive PPV upside as well.

The undercard payouts are as follows via Bad Left Hook:

Ray Beltran ($85,000) vs Arash Usmanee ($80,000)

Khabib Allakhverdiev ($250,000) vs Jessie Vargas ($90,000)

and Bryan Vasquez ($55,000) vs Jose Felix Jr ($40,000)

Promotion of the Fight

As is custom with a big fight, Pacquiao made an appearance on the Jimmy Kimmel Show.  Bradley made an appearance on the NBA on TNT in which he was interviewed during a Laker game.

Top Rank Boxing also utilized its web site to hype the fight as well as livestream the weigh-ins.

The customary repeats of Bradley and Pacquiao’s greatest fights including their first encounter were shown on HBO and on the Audience network.

It’s notable that less showings of HBO’s 24/7 series occurred over the multiple networks owned by Time Warner.  You may recall in past fights that the series could be seen on TNT, TBS and even CNN.  This time around, there was little cross-pollination.

HBO added a special on-location, live pre-fight show the Thursday before the fight in addition to its usual 24/7 shows.

One thing that drew the ire of Bob Arum was the fact that the MGM Grand had signs for Floyd Mayweather’s May 3rd fight.  The signs were more prominent than those of Pacquiao-Bradley II which was pointed out by Arum whenever he could.  Indirectly, this likely upset sponsor Tecate, since Mayweather fights are sponsored by Corona.  There’s obvious brand confusion ther.  Mayweather has fought at the MGM 9 straight times and it appeared that the loyalty took precedence over the Pacquiao-Bradley rematch.  It may also be due to the fact that Mayweather’s promotion has a contractual agreement to hype the fight at the MGM a certain time before the fight which may be the reason.

Sponsorships

The sponsors for this event include Tecate, Smart Communications, the leading wireless services provider for the Philippines

Tecate had its usual PPV rebate offer for those purchasing its beer at selected retailers.

The newest and most visible sponsor was Sony with its PlayStation 4 platform receiving high visibility during the fight including trailers of the PS4 gaming experience.  An example of this activation had PS4 running trailers in between fighter weigh-ins during the live stream on Top Rank’s web site.

Bradley wore a variety of hats to promote certain sponsors.  During his NBA on TNT interview, he wore a SaxonyInvest.com hat.  During the 24/7 series, he wore a Pocial hat which is a social networking web site that connects people through polls.  I am not sure if this is a great way to brand yourself but certainly Bradley is getting paid for these advertisements.

Bradley is still sponsored by Nike and had custom “Desert Storm” gear for the fight.  He also was sponsored by Lexani – a high end car wheel manufacturer. The shirt was on display at the weigh-ins.

Juan Diaz sported a Body Armor hat in the corner of Bradley during the fight.

Pacquiao’s cornermen must have received Mitshubishis as the Cerritos, California and South Coast Dealerships were plainly visible as patches on Buboy and others in Pacquiao’s corner.

Odds and Ends

An interesting takeaway from the 24/7 series is that Timothy’s wife, Monica Bradley, has taken over as his manager.  According to the show, she brokered Bradley’s new deal with Top Rank including the financial terms for this fight.  Bradley earned $6 million for his second fight with Pacquiao which is $1 million more than he earned in the first fight.  It’s a big question as to whether or not it’s a good idea to have your spouse represent you.  Negotiations can get heated and while it’s easier to grasp what your client wants, there may be an issue as to if you can separate yourself from the personal relationship.

Some may have noticed that Freddie Roach wore an Under Armour shirt at weigh-ins.  It seemed a bit odd considering that Pacquiao is sponsored by Nike and has worn Pacquiao Nike gear in the past.

The LA Times had an interesting article on the enforcement of PPV fees on bars that intend to show fights.  The charge is dependent on the size of the bar and the more seats in a bar, the more the bar has to pay.  As an example, a 50 seat bar is charged $1,600 for showing the PPV, a 51-100 seat bar is charged $2,200.  For those bars that may attempt to evade the fees, promoters employ enforcement that sues bars showing the PPV without paying.  Zuffa employs similar enforcement to protect itself from piracy.

With this fight, it’s likely that Pacquiao solidifies his spot as PPV royalty as he moves closer to the second spot of all-time top PPV performers.  Oscar de la Hoya currently owns second while Floyd Mayweather tops the list.

And yes, there was Pacquiao’s mother.

Conclusion

This fight had more storylines yet seemed to lack the hype or buzz of previous Pacquiao fights.  Nevertheless, this is one of those fights that people will find and would be willing to pay the $70 to watch.  Industry experts estimated the buy rate at 700,000 while Arum suggests a more optimistic buy rate of somewhere over 1 million.  Their last fight was 890,000.  Notwithstanding Pacquiao-Rios this past November, Manny is still a valued commodity in the boxing PPV landscape while Bradley is still an entertaining fighter on the rise.  We may just throw out that fight in Macau as an anomaly.  Perhaps I may be just bullish on Pacquiao and refuse to see the writing on the wall, but I believe that this fight will do better than their first fight and hit 1 million PPV buys.

Boxing beefing up on PPVs in 2014

April 13, 2014

Most MMA fans realize the strain that pay per views have on the wallet.  Boxing is starting to load up on them too as more of the bigger Golden Boy and Top Rank fights are heading to PPV instead of its respective premium networks.

Boxing PPVs are no longer limited to Manny Pacquiao and Floyd Mayweather.  It was announced today that Canelo Alvarez will fight Erislandy Lara on July 12th on Showtime PPV.  This will be the second PPV of the year for Alvarez as Golden Boy will hope to get at least 3 PPV fights from the Mexican star.

In addition to Alvarez-Lara, the big event upcoming for Showtime/Golden Boy is May 3rd’s fight between Floyd Mayweather and Marcos Maidana.

Last night, HBO/Top Rank featured its biggest fight in some time with Manny Pacquiao avenging his June 2012 loss to Timothy Bradley.  Its next big PPV fight will be Sergio Martinez taking on Miguel Cotto on June 7th.  The broadcast also hinted that Julio Cesar Chavez, Jr. will face Gennady Golovkin later this year in what should be a PPV affair.  Although not on PPV, Juan Manuel Marquez facing Mike Alvarado is PPV quality but will be on HBO (opposite the Bellator PPV) May 17th.

Payout Perspective:

Are boxing fans willing to spend $70-$75 on these fights?  If you count Saturday’s PPV, and you spend money on all of the boxing PPVs currently announced by the big fight promotions, you would be out $285 (assuming Mayweather’s PPV is $75) and it will only be July.  Certainly there are intriguing matchups.  However, one of the criticisms that came up during the Pacquiao PPV was the lack of worthwhile undercard fights.  Last night we saw 4 undercard fights go the distance which pushed the main event start after midnight for those on the east coast.  Golden Boy has done a better job of putting on interesting undercard matchups.  The UFC does provide better undercard fights as compared to boxing PPVs.  But with the addition of more boxing PPVs, are fans of both MMA and boxing willing to spend the extra money on boxing PPVs.

We assume boxing fans out there have HBO or Showtime or both to take advantage of its fight content as well as its fights.  Certainly boxing fans still get their money’s worth when it comes to fights on the premium networks (e.g., Maidana-Broner on Showtime last December and JMM-Alvarado coming up on HBO).  There have not been any announcements for the second half of the year but we can expect at least 4 or 5 more PPVs announced (Mayweather in September, Pacquiao sometime late 2014, JCC-GGG, Canelo late 2014 and perhaps a Broner fight).  Can boxing fans keep spending their money on these PPVs?

Pacquiao set to make $20 million with some going to IRS

April 11, 2014

USA Today is reporting that some of Manny Pacquiao’s guaranteed purse from Saturday’s fight against Timothy Bradley may be taken by the IRS to pay for old tax debts.  The fighter is scheduled to make no less than $20 million for his rematch with Bradley.

Bad Left Hook reports that both Pacquiao and Bradley will make $6 million according to the Nevada State Athletic Commission.  But, Bob Arum stated that Pacquiao would be guaranteed $20 million. Pacquiao made a guaranteed $18 million in his last fight against Brandon Rios although that fight was held in Macau. The purses for both fighters do not include PPV upside which could do anywhere from 700,000 to over 1 million PPV buys.  The last fight between the two drew 890,000 PPV buys.

As for the tax question, Pacquiao’s earnings in the U.S. are being scrutinized and it’s likely that he will owe money from this fight according to Pacquiao’s people.  However, they downplayed the seriousness of the audit by the IRS.  Not only does Pacquiao have tax issues here, but there are claims that the Bureau of Internal Revenue in the Philippines is investigating the fighter for unpaid back taxes which could be as much as $50 million.

Payout Perspective:

The alleged tax debt is a concern for Manny in light of cases such as Felix Trinidad who is reported out of money after an aide squandered over $63 million from Trinidad’s fight earnings. As much as Pacquiao makes, it would be unfortunate if his earnings are squandered away due to lack of paying taxes or people mismanaging his wealth.

Pacquiao seeks return to PPV prominence Saturday

April 9, 2014

This Saturday Manny Pacquiao returns to fight Timothy Bradley in Las Vegas in a rematch of their June 2012 bout which ended in controversy.  Yahoo! Sports reports on Pacquiao solidifying himself among the top boxing PPV draws of all-time.

According to an article by Steve Kim on Sports on Earth, Top Rank promoter Bob Arum believes that Saturday’s rematch can do over 1 million PPV buys.   However, people in the know (who we believe are impartial) think that 700,000 PPV buys is much more realistic.

The all-time revenue and PPV draws in boxing as compiled by Yahoo! Sports:

  1. Floyd Mayweather      Revenue:  $756,515,000 – PPV Buys:  12,643,000
  2. Oscar de la Hoya         Revenue:  $696,796,000 – PPV Buys:  14,081,000
  3. Manny Pacquiao         Revenue:  $661,061,000 -  PPV Buys – 12,193,000
  4. Evander Holyfield      Revenue:  $548,221,000 – PPV Buys – 12,583,000
  5. Mike Tyson                   Revenue:  $545,000,000 – PPV Buys – 12,400,000

“Manny Pacquiao broke the mold and blazed a very unique trail for the following reasons,” said Mark Taffet, the senior vice president of PPV at HBO Sports to Yahoo! Sports. “He’s not a heavyweight. He wasn’t an Olympian. He’s not from the very vibrant Latino or African-American demographic segments. He’s not American. He’s the only top non-American in that top five.

Payout Perspective:

Pacquiao’s success as a bona fide PPV star is an underdog story to sports execs but his ascension and subsequent global appeal can be traced back to his loyal-to a fault Filipino following and the greater Asian community as a whole that culturally sees Pacquiao as one of their own.  While he may never surpass Floyd Mayweather, Jr. in terms of revenue and PPV buys, he is the much less polarizing figure of the two.

Let’s take a look at some of the UFC’s top stars.  In comparing the top revenue/PPV buy producers in the UFC, Jon Jones leads the list of active UFC fighters with 7,375,000 PPV buys in 11 PPVs.  Cain Velasquez has 4,540,000 in 9 fights on UFC PPVs.  Anderson Silva has 8,670,000 in 16 UFC PPVs.  Georges St. Pierre is at the top of the list with 11,655 PPV buys in 21 UFC PPVs.  These numbers are based on their overall UFC PPV appearances.

UPDATED:  I’ve now included Brock Lesnar below.  Based on his average per PPV buy, the UFC probably misses him.

Jones (670,000 avg) does have a higher average per UFC PPV than GSP (550,000 avg), but GSP does have more overall buys.  We note both Jones and GSP were on two of the bigger shows in UFC history as they were on the UFC 94 (920K PPV buys) and UFC 100 (1,600,000 PPV buys) cards although GSP was either the main event (BJ Penn) or in the co-main (Thiago Alves) on those shows while Jones was on the undercards.

Top UFC PPV draws

Georges St. Pierre – 11,655,000 PPV buys in 21 UFC PPVs

Anderson Silva – 8,670,000 buys in 16 UFC PPVs

Jon Jones – 7,375,000 PPV buys in 11 UFC PPVs

Brock Lesnar – 6,580,000 PPV buys in 7 UFC PPVs (940,00 PPV avg)

Cain Velasquez – 4,540,000 PPV buys in 9 UFC PPVs

Sony’s PS4 brand to sponsor Top Rank fights this spring

April 7, 2014

The Sports Business Journal (subscription required) reports that Top Rank Boxing has signed on with Sony for its Playstation 4 brand  to receive “prominent placement” at this week’s Bradley-Pacquiao II event and June 7th’s Miguel Cotto-Sergio Martinez PPVs.

In addition, the PS4 logo will be seen during the May 17th Juan Manuel Marquez-Mike Alvarado fight on HBO.  Although no financial terms were revealed, SBJ estimates that the scale of such a deal would exceed $1M and “could approach $2M.”

The deal between Top Rank and Sony occurred via a LinkedIn “cold call” by Top Rank Exec VP Lucia McKelvey to PlayStation exec Guy Longworth.  The two had connected via the business-oriented social network site and McKelvey contacted Longworth about a potential sponsorship opportunity.  The pitch was premised upon using boxing as a means to target young Hispanic males “both inside and outside of the U.S.”

The activation includes a PS4 logo prominently displayed at all three fights and PlayStation trailers running on the PPV telecasts.  There also would be banners and pre-roll on Top Rank’s web site as well as social media integration during all three fights.

PlayStation 4 has sponsored UFC events as well as providing signage on the indoor rock wall for the memorable coaches TUF challenge between Ronda Rousey and Miesha Tate.

Payout Perspective:

The Top Rank-Sony PlayStation news may draw the ire of every young sales associate considering this lucrative partnership originated out of a cold call.  It’s clear that this cold call is much different than other ones but the fact remains it may not have happened without the initial pitch.  The partnership should help both brands as it gives the gaming console notable visibility during three of the bigger fights this year for the boxing promotion.  For Top Rank, it’s a blue chip brand that it has added to its portfolio of sponsors during a big stretch for the company.

HBO Boxing featuring Kovalev scores over 1 million viewers

April 2, 2014

Kevin Iole of Yahoo! Sports reported the ratings for Saturday night’s Sergey Kovalev-Cedric Agnew Fight on HBO.  According to Iole, the event featuring Kovalev’s win averaged 1.006 million with a peak at 1.048 million among the premium channel’s subscribers.

It was the first time that Kovalev headlined an HBO show. But, Kovalev’s promoter, Kathy Duva, was pleased with the showing since it went up against the NCAA tournament.

Iole noted that Kovalev drew 464K in the 18-49 demo which doubled the average overnight viewership (242,000) for the WSOF 9 on NBC Sports Network.

ESPN’s Dan Rafael reported that the undercard featuring Thomas Dulorme and Karim Mayfield drew 742,000 viewers.

Payout Perspective:

As stated in the Iole report, the 1 million viewer average is a pleasant surprise since it faced competition from WSOF and the NCAA Men’s Basketball Tournament. It is also a dramatic ramp up from the undercard fight.  Kovalev is not a household name among the casual boxing fan although HBO hopes that it can market and groom Kovalev into a fighter that can continue to headline HBO cards.

Boxing-Bellator PPV compete on same night

March 14, 2014

It was announced today that Juan Manuel Marquez will face Mike Alvardo on HBO on Saturday, May 17th.  This will be the same night as Bellator MMA’s inaugural PPV.

The fight between Marquez and Alvarado will take place at The Forum in Inglewood, California and it will be sure to draw a sell-out.  The fight will be at the catchweight of 143 pounds.  More intriguing was the announcement that the winner would face the winner of the Manny Pacquiao-Timothy Bradley fight on April 12th.

Payout Perspective:

This spring is a big one for Top Rank/HBO as it has Pacquiao-Bradley II, Marquez-Alvarado and Cotto-Martinez.  The fan interest for Marquez-Alvarado will also be peaked by the knowledge that one will face the winner of Pacquiao-Bradley.  Certainly, the name brand appeal would go for Pacquiao-Marquez V although the rematch of Marquez-Bradley would be entertaining as well.

But what does this mean for Bellator’s PPV?  With the Marquez-Alvarado fight on HBO, subscribers may be compelled to tune into the boxing match and skip the MMA PPV.  Of course, we’ll get the hardcore Bellator fans purchasing the PPV but if you are a combat sports fan you may be tempted to skip paying for Bellator and tune into HBO.  We will see in the coming weeks how each markets its show on May 17th.

Close to 1.4 million average for Chavez-Vera rematch

March 4, 2014

The HBO broadcast of Julio Cesar Chavez, Jr. versus Bryan Vera Saturday night scored an subscriber audience average of 1.39 million viewers with a peak of 1.53 million according to Nielsen Media Research via Boxing Scene.

The rematch between the two has made it one of the biggest audiences for either HBO or Showtime in the last 12 months.  The first fight in which Chavez was handed the decision earned an average viewership of 1.4 million.  The September 2013 fight was the second highest of 2013 on HBO as June 2013’s Miguel Cotto-Delvin Rodriguez fight earned over 1.5 million viewers.

Notably, the undercard fight between Orlando Salido and Vasyl Lomachenko did remarkably well as it averaged over 1 million viewers.

Payout Perspective:

Chavez looked much better this go round with Vera and based on the ratings, he’s one of the major draws for HBO/Top Rank.  The interesting thing about the great ratings is that the actual attendance was low for the Alamodome in San Antonio (approximately 7,000).  The attendance was newsworthy enough that the broadcasters made reference to it and the fact that Chavez was partly to blame for his lack of promotion as well as his effort in the last fight with Vera.

Boxing and MMA organizations support head trauma study

February 5, 2014

Competing combat sports organizations officially announced Tuesday its collaboration to contribute to an ongoing medical study to address and identify early stage signs of brain injury for those exposed to head trauma.

The UFC, Bellator, Glory, Golden Boy and Top Rank all expressed its support for the study at the Cleveland Clinic Lou Ruvo Center for Brain Health in Las Vegas.  Senators Harry Reid and John McCain showed their support for the study at the announcement held in Washington D.C.

Via Cleveland Clinic press release:

The study, which launched in April 2011, is focused on developing methods to detect the earliest and most subtle signs of brain injury in those exposed to head trauma, as well as determining which individuals may be more likely to develop chronic neurological disorders. While it is still in the early stages, researchers are confident the findings will benefit the safety and health of professional fighters. This information could also be applied to other athletes, members of the military and civilians who may experience head trauma.

According to MMA Fighting, most of the 450 fighters in the study are MMA fighters.  The study stands out as it monitors active fighters.  The study is partly funded by the Defense Department in hopes of using the findings for other brain injuries related to military duty.

Payout Perspective:

You may recall it was Senator McCain that had described MMA as human cockfighting.  Obviously, he’s now in the corner of the MMA here and supports this study.  The collaboration of all of these organizations reflects the importance of the issue and from public relations it shows that each of the organizations is concerned with its fighters.

The other way to see this is as a preventative measure from litigation.  I recently watched the Frontline documentary, “League of Denial” and the information was enlightening and shocking. One might be able to draw a comparison between the types of head trauma a football player receives versus that of a fighter without any headgear.

One thing going for this study is that it says it is tracking active fighters in hopes of spotting early signs of head trauma.  What the researchers to with this information and how it is utilized by each organization will be interesting to see.  Without being cynical, any study to understand head trauma in sports is a good thing and hopefully the research is put to good use.

HBO wins head to head versus Showtime

January 29, 2014

HBO Boxing almost doubled the television ratings of Showtime Boxing in a head to head face off on Saturday night.  Both boxing events ran up against each other and a portion of UFC on Fox 10.

HBO’s Boxing After Dark series featured Mikey Garcia taking on Juan Carlos Burgos taken by Garcia.  The broadcast scored an average of 777,000 viewers from its HBO subscriber base.  Showtime Boxing featured Lamont Peterson vs. Dierry Jean which averaged just 390,000 viewers from its Showtime subscribers.  Peterson took the fight in the Showtime main event.

(H/t:  Boxing Scene via Neilsen Media Research)

Payout Perspective:

HBO has more subscribers than Showtime so we might just dismiss the comparison.  Yet, it’s an interesting look at a rare head-to-head between boxing programming on the two premium channels.  Admittedly, these two shows are for boxing fans as the main events are not mainstream names that would move the dial for the casual viewer.  It does show that boxing is becoming more prevalent on television which should be good for fight fans.

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