July 14, 2014
Boxing writer Steve Kim of the new Undisputed Champion Network web site wrote an article on whether boxing has too many PPVs on the eve of Canelo Alvarez’s third appearance on PPV within 12 months. The question is not new to UFC fan as they have been asking the question for some time.
For the UFC fan, UFC 174 exemplified the thesis that there are too many PPVs. Preliminary reports have that PPV featuring Flyweight champ Demetrious Johnson anywhere between 95,000 to 125,000 PPV buys. Regardless of where that number ended, it was the lowest output for a UFC PPV since 2006. It reflects the new market for PPV in the UFC. Fans will pick and choose which cards they want to purchase and it’s unlikely we’ll see 1 million PPV buy main events in the near future.
Kim talked to Showtime’s Stephen Espinoza prior to Canelo-Lara:
“I think we’re having a confluence of pay-per-views really, simply because we have three or four fighters who can legitimately carry a pay-per-view and they’ve decided to make the decision to go there,” said Stephen Espinoza, Executive VP and GM for Showtime Sports and Event Programming, whose company is distributing this weekend’s event. “As for the network, we’d always prefer to have everything on the network. There’s certain realities which make that unrealistic but ultimately, it’s the fighter and the promoter that make that decision of when they want to go pay-per-view, when they don’t.
Kim also questioned whether boxing can go down the UFC road:
Still, a pay-per-view a month? What is this, the UFC? Does boxing really have that many fights worthy of such a designation?
The cynical MMA fan would say that the UFC doesn’t have that many PPV-worthy cards yet the UFC offers monthly cards on PPV for $55 per event.
For those that follow us, we touched on boxing beefing up its PPVs back in April. If you were to replace boxing with MMA in the article, the issues would be the same with the exception that Espinoza comments place the issue on the fighter/promoter rather than the network. In the UFC, the decision is all on the company whether it runs a PPV event and who will be on the card. In my opinion, a reason for more PPVs in boxing is a trickle-down theory in combat sports. Fighter/promoter payouts can be mitigated if a fight is put on PPV. Essentially profit margins are wider if you charge fans $60 for a fight rather than put it on subscription based television. It seems like this is the strategy rather than the previous strategy of waiting for a big fight with two top names. Certainly fighters have fought on HBO and Showtime in hopes that their career would ascend to a PPV. In recent weeks, boxing has put on some exciting fights on both premium subscription networks. So, the question is whether boxing fan will shell out $60-$75 for a fight that used to be on the networks.
July 1, 2014
ESPN reports that Saturday night’s HBO live boxing event featuring lightweight Terence Crawford defeating Yuriorkis Gamboa scored a rating of 1.208 million HBO subscribers with a peak at 1.286 million.
The Crawford-Gamboa fight was a back and forth action-packed fight. It was the second week in a row that had an entertaining fight as Robert Guerrero and Yoshihiro Kamegai put on a slugfest on Showtime the preceding week which drew 614,000 Showtime viewer average.
As reported by ESPN’s Dan Rafael, only Chavez, Jr-Vera II did better this year.
The fights on HBO Saturday coincided with UFC Fight Night 44 which received just 702,000 viewers on FS1. The HBO fights featured Terence Crawford fighting in his hometown of Omaha, Nebraska. According to Rafael’s report, it drew 10,943 for a gate of $500,000. It was a good draw for the hometown crowd. This makes it two weeks in a row in which boxing had two “Fight of the Year” fights. Although Guerrero-Kamegai may have drawn less, it was nonetheless a hard fought fight.
June 30, 2014
MMA Payout has obtained a copy of the lawsuit filed by promoters Main Events as it is suing the promoter for Adonis Stevenson for bowing out of an intended fight with Sergey Kovalev. The lawsuit centers around the involvement of boxing insider Al Haymon. It was filed last month with little occurring in the lawsuit so far.
The lawsuit was filed last month and has not seen much movement in the initial filing at this point. The plaintiff is New Jersey Sports Productions, Inc. which does business as Main Events. The promotion is owned by Kathy Duva. As MMA fans may recall, Duva filed a Declaration in Support of Bellator in the Eddie Alvarez lawsuit.
The defendants include Yvon Michel, his promotion, GYM; Golden Boy Promotions; Showtime Network, Inc. and boxer Adonis Stevenson.
To set the stage, Main Events’ Kathy Duva claims that it had an agreement for her fighter, Sergey Kovalev to face Yvon Michel’s promoted fighter Adonis Stevenson. The deal was allegedly sealed with emails in late January 2014 between Duva and Michel. The deal included a co-promoted fight on HBO which carried a $2.4 million rights fee. The fee was offered by HBO executive Peter Nelson which Main Events contends was accepted by Michel on behalf of his fighter.
However, Main Events learned that Al Haymon became involved and Main Events’ attorney sent a letter to Haymon confirming the Stevenson-Kovalev. Presumably, the letter was to prevent an anticipated breach on the part of Stevenson.
The Complaint paints Haymon as an individual with “a relationship with Showtime wherein certain promoters rely…for allocation of television dates and rights fees rather than negotiating those dates and fees directly with Showtime.” It also alleges that Haymon has an alliance with Richard Schaefer (then CEO of Golden Boy) and they had planned to “wrest control” of Golden Boy. As we know now, Schaefer and others have left Golden Boy and it’s not clear whether Schaefer and Haymon are entering into a venture together. The Complaint alleges that Haymon violates the Muhammad Ali Act as he acts as a manager or advisor to boxers despite not following the rules related to the Ali Act.
Main Events claims that Showtime interfered with the negotiations between HBO and the Kovalev/Stevenson fight despite Haymon pushing for a Stevenson-Bernard Hopkins fight with Showtime.
The legal claims:
Breach of Contract
Main Events claims that Stevenson’s management group, GYM, breached its contract to co-promote a bout between Stevenson and Kovalev.
Breach of Fiduciary Duty
Main Events claims that GYM breached a fiduciary duty premised upon the co-promoted agreement as the two sides were to have split revenue on the proposed fight. It goes on to claim that since the co-promotion is considered a joint venture, GYM breached a fiduciary duty to Main Events for not going through with the co-promotion.
Fraud by Stevenson’s Promoter
Main Events has sued Stevenson’s Promoter, Yvon Michel, personally for fraud as it is alleged that he represented to Main Events that it “had nothing to worry about” regarding the agreed Stevenson-Kovalev fight and Haymon’s involvement was a mere way to “increase the rights fees for the unrelated interim bout.” The interim bout that is being referred to was a fight in Montreal between Stevenson and Andrzej Fonfara. Stevenson fought Fonfara in late May on Showtime. In that fight, Stevenson hit the canvas once, but eventually won a decision over Fonfara.
Tortious Interference with Contract
Main Events claims that Haymon, Golden Boy, Stevenson and Showtime based upon the set of events, claims it had a deal for Stevenson-Kovalev, but the defendants interfered with that contract.
Interference with Prospective Economic Advantage
Premised upon the alleged agreement for a fight between Stevenson-Kovalev, Main Events contends that Haymon, Golden Boy, Stevenson and Showtime interfered with an existing contract for the fight and that there was “a reasonable expectation that plaintiff [Main Events] would have economically benefitted from the business relationship.” Essentially, Main Events claims that it would have benefited (and it would have) from the fight between their fighter and Stevenson. But there was interference which caused Stevenson to back out of the agreement.
This is another example of the competitive nature between HBO-Showtime and Top Rank-Golden Boy. Actually, here its Main Events. Since the lawsuit was filed, Schaefer has left Golden Boy and the move may impact this lawsuit as it relates to the accusations between the companies. The latest has a Summons issued to Schaefer in Laguna Beach, California. A pretrial conference that was to occur last week has been pushed to July 11th.
As for the legal maneuvering, it’s likely that Haymon, et al. will file a motion to dismiss the Complaint premised upon the argument that there was no binding contract between Main Events and GYM, and as such, there was no breach. Premised upon the fact that there was no breach, there would be no fraud by Michael or interference with a contract.
The lawsuit underscores the power of Al Haymon in the boxing industry. It’s clear that he has a powerful stable of fighters and has had working relationships with Showtime. As many know, Haymon advises Floyd Mayweather. Main Events alleges that Haymon acts as manager to his boxer which circumvents the Muhammad Ali Act which attempts to protect fighters. The Complaint does not delve into this violation as it is not a plead cause of action at this point. However, if discovery commences in this lawsuit, we may see allegations of specific violations.
It will be an interesting lawsuit to follow and MMA Payout will keep tabs on it.
June 26, 2014
SI.com is reporting that the Miguel Cotto-Sergio Martinez Top Rank PPV event that took place on June 7th only drew between 300-315K PPV buys which is well under the expected 500K anticipated.
After putting Martinez down three times in the first round, Cotto scored a 10th round KO of Martinez. It was a much anticipated fight fans and well promoted on HBO.
SI’s Chris Mannix writes that multiple sources working with the promotion confirmed the number. Mannix goes on to attribute the disappointing buy rate to a multiple of factors including the Belmont Stakes and the Stanley Cup which went into double overtime that night and well into the PPV.
In addition, UFC Fight Night 42 from New Mexico took place that night as well with Benson Henderson taking on Rustam Khabilov in the main event. It was the third most-watched Fight Night on FS1 so far.
Bob Arum admitted to ESPN’s Dan Rafael that, “[t]he numbers were not great.” He attributed this to “too many” PPVs.
“Pay-per-view was always designed, as was closed circuit back in the day, for true super fights, not just very good fights. There have been pay-per-views every month and people resent the fact that they’re asked to pay extra for anything halfway decent. Boxing pay-per-view numbers are down. Look at the (recent) numbers for the (Floyd) Mayweather and (Manny) Pacquiao fights. The UFC pay-per-view numbers are also down.”
Despite the rough numbers for PPV, Arum told ESPN that the gate drew $4.7 million.
Arum essentially blames the low numbers on MMA fans’ favorite word when it comes to ratings: oversaturation. In fact, Yahoo! Sports Kevin Iole wrote a controversial piece on whether saturation is good for the UFC. With Canelo Alvarez facing Erislandy Lara in a couple weeks, boxing will have another PPV this year that caters to the steady boxing fan. Alvarez is still not a top draw and Lara is not known to anyone that does not follow boxing. So, are there too many boxing PPVs at this point? There will definitely be more this year than last and at a price point between $60-$75, its likely fans will be picking and choosing which to buy. Perhaps, many combat sports fans will implement a “one week rule,” which is to wait a week for the PPV fight to air on HBO/Showtime. Even if you were to pay for HBO-Showtime, your cable bill for those premium channels could rival that of you purchasing all the boxing PPVs. Plus, you would get all of the boxing shows on the networks…and of course the rest of what those premium shows have to offer.
Looking at the fight specifically, it was an under the radar good fight on paper. Certainly, the Puerto Rican fan base came out for Cotto. The same for the Argentinian fans of Martinez. But, was it something that the broader, casual fan would purchase, or wait to see on HBO a week later?
June 17, 2014
ESPN’s Dan Rafael reports that the replay of the Miguel Cotto-Sergio Martinez fight on HBO drew 970,000 viewers and peaked at 1.126 million. It was the opening of the HBO Boxing After Dark telecast which drew 954,000 viewers overall and was the most-watched BAD card of the year.
The live main event which featured Ruslan Provodnikov taking on Chris Algieri peaked at 1,110,000 viewers and overall drew 1,046,000. Also on the fight card, the Andrade-Rose fight average 882,000 viewers.
The Cotto-Martinez fight went on at the same time as the start of the UFC PPV. While we have no numbers, we might assume that the HBO subscribers watching at least the first round of Cotto-Martinez were more than those that ordered UFC 174. HBO had hoped to build up Ruslan but he was upset Saturday night. Overall, it was an entertaining night of fights started by the replay of the Cotto fight.
May 22, 2014
ESPN reports that Manny Pacquiao has signed a two year extension with Top Rank Boxing. The deal will go through December 2016 and likely ends talk of a possible Pacquiao-Mayweather fight.
Top Rank Promoter Bob Arum indicated that the financial terms were not disclosed due to a confidentiality agreement. The deal also extends MP Promotions which co-promotes Pacquiao along with Top Rank. Mayweather is halfway through a six fight deal with Showtime.
The new deal apparently closes the door on the biggest fight in boxing that never happened. Let’s face it, the fight everyone wanted to see went away years ago. Pacquiao will be 38 when this contract ends and it would be prudent for him to retire at that point. Mayweather has expressed interest to walk away as well after his Showtime contract is up. While Arum has stated that there still may be a chance for a Pacquiao-Mayweather fight, its unlikely we would want to see it at the end of their respective careers.
May 21, 2014
Kevin Iole of Yahoo! Sports reported via Twitter that Saturday night’s HBO Boxing event featuring Juan Manuel Marquez and Mike Alvarado averaged 1.2 million HBO subscribers. The peak for the event taking place at the Forum in Inglewood, California was 1.3 million.
To be exact, Iole reports the fight averaged 1.198 million and the peak was 1.322 million. The undercard featuring Viktor Postol and Selcuk Aydin scored an average of 1 million viewers with the peak for Postol’s victory at over 1.1 million.
For those wondering, JMM made $1.4 million this past Saturday while Alvarado made $650,000 according to the California State Athletic Commission (via Bad Left Hook).
Solid numbers for HBO as it competed for sports viewers with NBA Playoffs and the Bellator PPV. Juan Manuel Marquez is still a name that can draw viewers (especially the strong Mexican fan base) and with the winner potentially facing Pacquiao next, there was some added interest. The fight did not disappoint as both fighters went down in consecutive rounds.
May 12, 2014
ESPN reports the PPV rate for the rematch between Manny Pacquiao and Timothy Bradley received between 750,000 and 800,000 buys. The estimated buy rate was a “disappointment” according to Top Rank promoter Bob Arum.
The ESPN article noted that HBO did not produce a formal release but did confirm that the event generated $49 million in gross PPV revenue. Arum cited the “absence of [a] Mexican or Hispanic opponent” and the lack of support for Timothy Bradley from the African American community as contributing reasons for the porous PPV numbers.
Although the PPV buy rate would be good for a big UFC event, it’s the second disappointing outing for one of boxing’s biggest PPV draws. Pacquiao’s November fight with Brandon Rios drew just 475,000 buys. Even in a rematch with some interesting storylines, the fight failed to outdraw their initial fight in June 201. PacBradley I received 890,000 PPV buys.
Arum indicated a return to Macau, China for Pacquiao’s next fight due in part to “huge site fees” and the potential to launch PPV in China which would bolster the sagging domestic PPV revenue.
Could this be the last even Pacquiao fights in the U.S.? With the second consecutive disappointing PPV buy rate from Pacquiao, it appears that Top Rank will focus on the international market and other revenue streams rather than depend on domestic PPV. Last November’s Macau event faced many logistical issues including the fight taking place Sunday morning due to the time difference and did not draw well here in America. If Top Rank focuses on the international market, would it still cater to America with its start time? We will see if this is just talk or if Top Rank will really follow through with having Pacquiao fight outside the U.S.
May 2, 2014
The Sports Business Journal recently put out its “Fight Issue” which gave a rundown on the most-watched boxing matches from April 2013 to April 2014.
The top 6 according to the list compiled by SBJ:
- October 5, 2013 – Miguel Cotto vs. Delvin Rodriguez – HBO – 1.55M
- September 28, 2013 – Julio Cesar Chavez, Jr. vs. Bryan Vera I – HBO – 1.42M
- November 2, 2013 – Gennady Golovkin vs. Curtis Stevens – HBO – 1.41M
- March 1, 2014 – Adonis Stevenson vs. Tony Bellew – HBO – 1.4M
- June 22, 2014 – Adrien Broner vs. Paulie Malignaggi – SHO – 1.28M
- December 14, 2014 – Adrien Broner vs. Marcos Maidana – SHO – 1.28M
Notably, the bulk of fights scoring high on the list were from HBO with only 3 Showtime events hitting the top 20. NBC had one appearance with the Steve Cunningham-Tyson Fury fight on April 20, 2013 delivering 1.2M viewers for the duration of the broadcast.
Of the top 20, 19 of the events hit at least 1 million viewers for the main event of the card.
Remember when we said Boxing was dead? It is not. In fact, the competition between Golden Boy/Showtime and HBO/Top Rank has helped fight fans see some competitive fights and more of them. The one drawback for economic-conscious fans is that there are more PPVs in addition to the amount one would pay for the premium channels of HBO and Showtime.
April 29, 2014
Boxer Mikey Garcia has sued Top Rank Boxing for violations of the terms of its promotional agreement under the Muhammad Ali Boxing Reform Act and laws in the state of California. Garcia’s lawyers characterize the promotional agreement as making the boxer an “indentured servant.”
The lawsuit was filed earlier this month in Riverside County Superior Court in Riverside, California.
According to the lawsuit, “Garcia will demonstrate that Top Rank’s Promotional Rights Agreement violates numerous provisions of both California law and California’s strong public policy to protect California-based boxers from unscrupulous promoters and managers and from entering into improvident arrangement and is therefore unenforceable.” As for the violations of the Ali Act, Garcia’s attorneys state that Top Rank did not provide the required disclosures under the act which requires that Top Rank let Garcia know the amount of money it would make from each of Garcia’s bouts.
Garcia is a Super Featherweight out of Riverside, California. He is currently the World Boxing Organization’s champion. He signed a Promotional Rights Agreement before Top Rank represented him which Garcia’s lawyers contends it grants Top Rank the ability to extend the agreement indefinitely.
The promotional contract was entered on April 13, 2006 which gave Top Rank the exclusive right to promote Garcia’s services as a boxer. The terms of the Contract, which ran for 5 years, gave Top Rank the right to renew the terms of the agreement.
Garcia’s lawyers argue that Top Rank acted as Garcia’s manager which would be a violation of California law since it did not fill out the requisite forms to manage a boxer in California. This was similar to the problems faced in the Ronda Rousey-Fight Tribe arbitration.
The Complaint also alleges that Top Rank did not disclose the payments it received from Garcia’s fights which would be a violation of the Muhammad Ali Act. Specifically sec 6307e(b)(1)-(3).
Lawyers for Top Rank have downplayed the lawsuit calling it “baseless” and we will likely see them seek a dismissal of Garcia’s claims.
The promotional contract indicates that the jurisdiction is Nevada which may cause some procedural backlash by Top Rank. In addition, Garcia is suing based on the Ali Act, a federal law, which may cause another procedural issue related to removing the case to federal court.
It’s interesting to note that on HBO’s The Fight Game, the belief was that no one close to Garcia knew he was unhappy and that he was going to file the lawsuit. The inference is that there were no issues between Garcia and Top Rank.
I have not seen a fighter prevail in a case under the Muhammad Ali Act. While Garcia may have a valid claim, it’s likely that the lawsuit will precipitate a settlement with Top Rank or to sever ties with it.
MMA Payout will keep you posted.