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Popular overseas bouts shift model for HBO
Published March 31, 2014, Page 12
London-based fight promoter Barry Hearn pictures viewers in the U.S. breaking their normal viewing habits to tune in to HBO on a Saturday afternoon, sucked in by the mass of the event.
|Promoters hope to pull Saturday afternoon viewers to HBO for Carl Froch and George Groves’ rematch.
Boxing always has been a global sport, but the U.S. long has stood as the economic driver. You could stage a fight in Antarctica so long as you made sure it went off at a time that was right for networks in the States. For the last 20 years, that network has been HBO and that time has been Saturday night.
But as the economics of the fight game have shifted, with HBO offering lower fees than some networks in Europe, overseas promoters putting on shows that sell out large venues, and pay-per-view re-emerging in the U.K., HBO has ceded some of its leverage.
The question for HBO now is whether to ignore meaningful fights from around the globe or to tweak its model to accommodate them. Of late, it has chosen the latter. Froch-Groves II will be the fourth event HBO has telecast live from Europe in the last year.
“It’s still not our preference to go on a Saturday afternoon, but for the right opportunity we’re willing to do it,” said Ken Hershman, president of HBO Sports. “The fact is, the biggest and best events will sometimes take us abroad. We’ll do that when we can do it rationally in terms of budgets if it’s something that adds value for our subscribers.”
Thus far, the afternoon fights have drawn an audience that is a bit less than half of the 1.2 million that typically tunes in on Saturday nights. But when paired with prime-time rebroadcasts, they’ve floated up to the norm.
Froch-Groves II will not air in prime time on HBO, but only because the network has a live concert from the Rock and Roll Hall of Fame scheduled for that night. Froch against Denmark’s Mikkel Kessler in May from London attracted a live audience of 493,000 and another 517,000 for the re-air. Heavyweight champ Wladimir Klitschko against Olympic gold-medalist Alexander Povetkin from Moscow got 534,000 viewers on an October afternoon and another 705,000 that night. Sergey Kovalev against Nathan Cleverly from Wales in August pulled 367,000 viewers in the afternoon. It did not air again that night but proved an opportune way to showcase two fighters who had not been on HBO. Kovalev won, graduating to a U.S. fight that had the eighth-highest rating of any fight on cable last year.
“What we’ve found is that we really are serving the same hard-core audience that comes to all those shows but that they may just watch it at different times,” Hershman said. “Our fans are not accustomed to looking to us for a fight at 4 or 5 in the afternoon, so oftentimes we’ll pair it with a live fight at night to maximize the audience.”
It’s important to note that this is no rank-and-file U.K. fight. Froch won the first fight in front of a sellout of 21,000, on a controversial ninth-round stoppage while trailing on all three judges cards.
A week before tickets to the rematch went to general on-sale, the head of Matchroom’s boxing division, Barry Hearn’s son Eddie, tweeted a presale invitation to his 149,000 followers, 35,000 of which provided email addresses in order to get access. All 60,000 tickets sold out in 52 minutes. Eddie Hearn is working to get the London transit authority to allow him to expand capacity at Wembley to 80,000.
Even at 60,000, the gate likely will eclipse
$8 million, Barry Hearn said. That would equal the 15th-largest Las Vegas boxing gate of the last decade and more than triple the gate from the most recent Vegas pay-per-view, Canelo Alvarez’s stoppage of Alfredo Angulo. The U.K. pay-per-view revenue would eclipse $20 million if it performs as Matchroom expects.
With all that money coming from the home market, Matchroom views the U.S. rights as ancillary. HBO is paying less than it would pay for a fight in prime time. And because it can get a high-quality feed from BSkyB, it also will save on production costs.
The value for Matchroom, Hearn said, lies mostly in the exposure for Froch and Groves, who could end up fighting in the U.S. on HBO or in a pay-per-view. That’s another reason Froch-Groves was attractive for HBO: It plays heavily in the weight class and the two that bracket it, with investments in Andre Ward, Julio Cesar Chavez Jr., Gennady Golovkin and others.
“It’s OK to do a fight or two abroad, because they are fun, large spectacles,” Hershman said, “but we also want to get those fighters over here. Some are precluded from coming over here because of an economic model they have. That can make it less appealing for us.”
That’s the conundrum HBO faced when it last ventured to Europe with greater frequency. As Wladimir Klitschko and brother Vitali rose to dominance, HBO aired their fights from Germany and elsewhere, content to time-shift in order to have the brothers in prime time on the occasions that they fought in the U.S.
But as HBO’s boxing budget shrank and the take from German TV and European arenas increased, it no longer made financial sense for the Klitschkos to fight in the States. HBO responded by sitting out some of their fights.
“We thought that was a mistake,” said Tom Loeffler, managing director of the Klitschkos’ K2 promotions company, which also promotes Golovkin. “I think [Hershman] is looking at it more globally. Yes, you’d rather have the fight here, but eventually, either Froch or Groves could come to the States. If fans here are familiar with them, there’s only going to be more interest.”