Boxing’s grand stage

Seated at ringside in the steam of a June night, Bob Arum surveyed the 60-foot-high mass of scaffolding, canvas and lights that had taken over right field at Yankee Stadium.

“This fight cost us a fortune,” said Arum, founder and CEO of leading boxing promoter Top Rank, who estimated that his company spent about $1 million to stage boxing at the colossal ballpark. “So, economically, it doesn’t make all the sense in the world. But look at what it’s doing for the sport. It’s bringing us back to the mainstream.”

Behind and high above him, seats filled steadily with spectators. By the time Miguel Cotto and Yuri Foreman touched gloves at the approach of midnight for a title fight that aired live on HBO, the stadium had turned electric, with a paid crowd announced at 20,272 reaching to the top of the upper deck.

Flags large and small — most of them of Puerto Rican, for Cotto, but also some Israeli, for Foreman — billowed and shook, particularly at the stadium’s upper reaches.

This is what Arum envisioned when he brought the fight — notably, the right fight: Cotto on the weekend of New York’s Puerto Rican Day Parade facing a champion who is training to be a rabbi — to the Yankees’ home field, which had not hosted boxing since Arum promoted the close of Muhammad Ali’s trilogy against Ken Norton at the old Yankee Stadium in 1976.

Arum was willing to spend more, and perhaps make less, in the hope of nudging the sport back toward the masses. Pay-per-view telecasts deliver greater revenue but shrink the audience. Fights in casino ballrooms and Las Vegas arenas generate larger guarantees at a lower cost, but shrink the audience. Putting Cotto-Foreman at Yankee Stadium was a risk, but with the potential of long-term reward.

Top Rank took a similar chance when it brought Philippine megastar Manny Pacquiao to Cowboys Stadium in March. It was rewarded with a paid crowd of 36,371 and a gate of $6,359,985, according to post-fight tax reports filed with Texas boxing regulators. Counting complimentary tickets delivered to sponsors, media outlets and others, the Dallas fight attracted 41,843, well short of the 50,994 that the hype-conscious Cowboys announced, but still an epic number for stateside boxing.

The card at Yankee Stadium last week likely generated less than half that in ticket revenue. Arum conceded he may have turned a larger profit off a smaller crowd at Madison Square Garden. There was a boost in television money from HBO, which was willing to pay a bit more for a first-ever fight at the new Yankee Stadium than the network would have for the same bout at Madison Square Garden, where Cotto has fought previously when in New York. But the fight likely would have sold nearly as many tickets at a higher price at MSG, and the overhead would have been far less.

“We would have made the same money and it would have been a lot less work,” Arum said. “But it was absolutely the right thing to do. It’s essential for the future popularity of the sport that we do more events in stadiums and arenas. You can’t have a sport that has all of its events of any note in casinos. It may make economic sense. But to grow the sport and have it appeal to more people, you can’t survive that way.

Christian Martinez (right) throws a punch to the
body of Jonathan Cuba during a warm-up bout
on this month’s card at Yankee Stadium.

“Cowboys Stadium did wonders for the sport all over the United States . This fight is doing wonders. If you really have the best interest of the sport at heart, these are the places you have to be.”

For HBO, the company that often is referred to as boxing’s banker, the shift is a welcome one, even though not a penny from tickets will hit its bottom line. HBO has noticed a broader, and younger, audience for boxing as a result of its “24/7” series, which follows fighters behind the scenes, telling their stories and exposing their personalities. It believes fights at stadiums and large, filled arenas can do the same.

“Packed stadiums make for great television,” said Ross Greenburg, president of HBO Sports. “It creates an electricity in the arena that translates into a big event feel on television. For HBO, this is a major boon. And this only lifts the sport.”

Vegas has the odds

For all the excitement created by the two recent stadium showcases, the clear economic winner thus far this year was staged where almost all the biggest fights have been staged, at the MGM Grand Garden Arena in Las Vegas.

Floyd MayweatherJr.’s win against Shane Mosley last month was an example of the massive financial edge that the resort city holds with big-event boxing. Promoted by Oscar De La Hoya’s Golden Boy Promotions, Mayweather-Mosley generated $11,032,100 in revenue from 14,038 tickets sold, according to filings with Nevada boxing regulators. That’s about double the ticket revenue of Pacquiao’s Cowboys Stadium fight, which drew three times as many fans.

“There is a special feeling when you do a fight in one of those big stadiums,” said Richard Schaefer, CEO of Golden Boy, which drew about 55,000 when it put Ricky Hatton in the ring at a soccer stadium in Manchester, England , two years ago. “But we have to be careful. There is always a novelty factor when you do a fight at a place like Cowboys Stadium or Yankee Stadium. You can get away with that once. But the next time it’s going to get more difficult. After that first time, you have to make sure it’s a fight that is strong enough and compelling enough that you can bring in that large number of people.

“It’s nice to have 50,000 or 60,000 people in a stadium, but at the end of the day the fighter is going to want to get paid.”

Fans packed Cowboys Stadium in March to
watch Manny Pacquiao fight Joshua Clottey.

For the biggest of fights, Vegas pays off as none other can.

At the MGM, for Mayweather-Mosley, the most expensive seat was priced at $1,250. They sold 4,881 of those seats, generating $6.1 million — or just a tick short of the entire Cowboys Stadium gate. Another 2,450 tickets sold at $1,000, bringing in $2.45 million.

The highest price at Cowboys Stadium was $700. They sold 2,852 of those seats, bringing in just shy of $2 million. More than 20,000 of the 36,371 tickets sold in Dallas went for $100 or less. Almost 70 percent of the tickets at the MGM Grand sold for $600 or more.

Those prices are sustainable because Vegas fights work from a different model than that of most venues. Resorts, and particularly the host resort, use the tickets to attract high rollers, who will drop multiples of the $1,250 ticket price at the casinos. Promoters know that the host resort will commit to buying 15 to 30 percent of the tickets, and that other hotels, hospitality providers and brokers will snap up many more.

“One of the big differences between us and Vegas is we didn’t have a lot of casinos buying up our prime inventory,” said Chad Estis, vice president of sales and booking for the Cowboys. “So what we sell is what we’re actually selling to the public. We were very cautious with our floor seating to not go too high.”

It is important to note that the Pacquiao and Mayweather fights were not created equally. Pacquiao fought a second-tier opponent, Joshua Clottey, while Mayweather-Mosley was the most marketable matchup this side of the as-yet-unmade superfight, Mayweather-Pacquiao. A true megafight in Dallas would justify a higher price.

It’s also key to remember that, for the three or four biggest U.S. fights each year, the bulk of the money is made not from the arena, or even from a standard TV rights deal, but from pay-per-view sales. The Mayweather fight brought in $78 million from about 1.4 million PPV sales, according to its producer and distributor, HBO. Pacquiao’s stadium fight generated about $35.3 million from 700,000 buys.

Still, with HBO and Showtime putting fewer fights on pay-per-view, and TV rights fees for boxing far short of previous levels, the venue has become an increasingly important piece of the package for many fight deals. This is a shift for many in the boxing business, who didn’t have to pay as much attention to selling tickets when they had the Las Vegas resorts buying large swaths of them at their larger arenas, or casinos across the country paying guarantees to put them in smaller ballrooms.

“I think the promoters got lazy,” said Gary Shaw, a leading promoter in both boxing and mixed martial arts who previously served as a fight regulator in New Jersey. “Promoters used to promote a product — the fighters and the fights. And then when the casinos came in and started giving site fees, and you also had the TV money, you didn’t have the same pressure to sell tickets. There was less reason for the promoters to promote.

“Not everybody in this business today knows how to sell tickets. It takes a lot of work and resources and capital.”

No large U.S. sports arena has been booking boxing for as long, or with as much consistency, as Madison Square Garden. With a 5,000-seat theater, MSG also has a place for the many fights that can’t justify a place in the big house. But even counting both those sites, MSG has slowed its boxing flow in recent years, dropping from six fights in 2006 to five in ’07, four in ’08 and three in ’09. Thus far this year, it has held three fights, all at the theater.

The executive vice president who runs boxing for MSG, Joel Fisher, said the venue wants to book more fights, especially in the theater.

“Madison Square Garden, we feel, is the mecca of boxing,” Fisher said. “We’re looking to do more and more fights. There’s not a lot of them now. That’s frustrating for everybody. But we speak with (all promoters) regularly, and we’re working on it.

“People in buildings think it’s easy. When they get an opportunity to do something, they take it. They want to have a fight whether it sells or not. And more often than not, it’s not going to sell. It’s not easy.”

Michael Yormark, the president of Sunrise Sports and Entertainment, which owns the Florida Panthers and operates BankAtlantic Center, was bitten by the boxing bug more than 20 years ago, while interning in Madison Square Garden’s boxing department under Bobby Goodman. Until recently, Goodman headed boxing operations for Don King Productions, which is headquartered about 25 miles up the expressway from BankAtlantic Center.

Yormark wants fights on the menu at his arena, but he has tried it enough times now to realize that it likely will take more consistency to make it work.

“I think boxing has some potential here, but we’ve got to work at it and keep it alive and promote it,” Yormark said. “It can’t just be that we’re going to put a fight (ticket) up for sale, the fight is going to be five weeks later, and then we go away. There’s got to be a concentrated effort to build the following of the sport. So when we do announce a fight it’s a little bit more top of mind.”

At Showtime, they’re trying to do that through a tournament that will resolve the top of the super middleweight division. The next fight of the series is Saturday night at Oracle Arena in Oakland.

“Between Europe and the U.S. , we’re seeing fight after fight with 12,000 people, when for a long time we were in tiny venues trying to scrounge out 2,000 tickets sold,” said Ken Hershman, executive vice president and general manager of Showtime Sports. “That’s helping our television. It’s helping our events feel bigger because they are bigger.”

Seeking consistency

In the two markets outside Vegas that have remained most viable for boxing, New York and Los Angeles, venue operators stress the importance of that consistent delivery of boxing cards.

Like Madison Square Garden, the major facility operator in Southern California, AEG, benefits from owning or operating multiple venues in the market. Both companies can feed content to fight fans, and potential fight fans, by putting bouts in smaller venues. In AEG’s case, that includes Staples Center, the 7,000-seat Nokia Theatre and 1,500-seat Club Nokia in Los Angeles, as well as the soccer stadium and 7,000-seat tennis stadium at Home Depot Center in nearby Carson.

Tale of the tape: Breaking down two major fights
A hoped-for bout between Manny Pacquiao and Floyd Mayweather Jr. could break the bank, based on results from the fighters’ most recent bouts. Pacquiao fought Joshua Clottey on March 13 at Cowboys Stadium, while Mayweather fought Shane Mosley on May 1 at the MGM Grand in Las Vegas. The research below shows how those numbers stack up.
Pacquiao-Clottey Cowboys Stadium		Mayweather-Mosley MGM Grand
Ticket price	No. sold	Ticket price	No. sold
$700	2,852	$1,250	4,881
$500*	541	$1,000	2,450
$500	736	$600	2,266
$300	3,062	$300	3,034
$175*	94	$150	1,407
$150*	202	—	—
$200	3,955	—	—
$150*	20	—	—
$100*	280	—	—
$75*	872	—	—
$50*	40	—	—
$175 (suite)	801	—	—
$100	12,064	—	—
$50*	600	—	—
$50	8,996	—	—
$35	1,256	—	—
Paid crowd	36,371	Paid crowd	14,038
Comps	5,472	Comps	886
Total	41,843	Total	14,924
Ticket revenue	$6,359,985	Ticket revenue	$11,032,100
* Discounted tickets. For example, a $700 ticket was sold for $500, while a $300 ticket was sold for $175
Las Vegas closed circuit sales (Mayweather-Mosley)
Casino	Tickets sold (all tickets $50 each)
Mandalay Bay		2,876
Mirage		1,582
Monte Carlo		981
Luxor		706
Circus Circus		376
Aria		191
Total		6,712
Closed circuit revenue		$335,600
HBO pay-per-view
Fight		Buys	Revenue
Pacquiao-Clottey		700,000	$35.3 million
Mayweather-Mosley		1,400,000	$78.3 million
Las Vegas payouts
Floyd Mayweather Jr.		$22,500,000
Shane Mosley		$6,750,000
Note: The Texas Department of Licensing and Regulation would not release boxer contracts or payment details for the Pacquiao-Clottey fight, citing privacy laws. Also, the figures for Mayweather and Mosley do not include the fighters’ shares of pay-per-view sales. Sources: Documents filed with Texas and Nevada boxing regulators; HBO

More importantly, they’re learning who the fans are, and how to find them.

When Staples Center hosted its first fight in 2000, it started with a whopper, De La Hoya vs. Mosley. Thus was born the database that matters most when it comes to reaching fight fans — a list of buyers for previous fights. AEG now has a decade of those. And while they stumble on occasion, as they did with a Paul Williams fight that whiffed at the tennis stadium, boxing also has provided some of the more profitable nights in the history of the Staples Center, including the most-attended event ever, Mosley’s fight against Mexican star Antonio Margarito.

“We can tap into the proven fight fans in our venues,” said Dan Beckerman, chief operating officer of AEG. “It’s not like you put it on sale, run an ad, give them the phone number and the website and then it sells itself. It doesn’t.

“Creating an entire infrastructure for a single fight doesn’t make sense. But because of our teams and venues, you have a massive sales force … and database marketing and digital media. You can leverage those. And if you partner with the right promoter, make the right deal, and deploy your resources correctly, you have a shot. But it’s hard work.”

In 2008, AEG and Golden Boy went into business together, deepening AEG’s stake in the fight game and the fight promoter’s connection to an armada of desirable venues across the globe. De La Hoya bought into one of AEG’s Major League Soccer teams, the Houston Dynamo. AEG became the largest minority shareholder in Golden Boy.

“AEG adds a little marketing might (for boxing),” said Greenburg, the head of HBO Sports. “I think they’re willing to spend the way Madison Square Garden is willing to spend and we’ve found the Yankees are willing to spend, and that’s important. We need their marketing dollars. You can’t put people in seats if there’s no awareness that the fight is happening. It’s up to the AEGs and Madison Square Gardens and the Yankees and others to spend money in order to make money.”

Typically an arena can find incentives to put promotional weight behind a fight. While there are almost as many deal structures as there are fight nights, stadiums and arenas always keep the profits from concessions and parking, so it is in their best interest to do all they can to fill seats.

The shortcoming in the relationship more often comes from the promoter. Pumping a fight in the local market takes cash and elbow grease. With a guaranteed paycheck in hand from TV rights, and no guarantee that additional marketing will drive enough tickets to cover the cost of the marketing push, the promoter may opt to leave the promoting to the building and take whatever comes in.

“You can’t just lay an event at a guy’s feet and say, ‘OK, let’s see how you do; go sell it,” said Todd Duboef, president of Top Rank. “We don’t just cash our check and go home. A true partnership has to exist in the marketing, in how we’re going to move the promotional needle in the local market, using the cable operators and the local media, using activation campaigns with sponsors like Tecate — all those things are key ingredients to moving tickets in any market. The Cowboys know their market. We know how to sell boxing. You sit down together lots and lots of times and you figure it out.”

Building partnerships

The boxing promotion company that grew up to be Main Events started out humbly enough, putting on cards for fight fans at Ice World, a converted skating rink that seated about 3,000 in Totowa, N.J. At its zenith, it promoted Evander Holyfield, Lennox Lewis, Pernell Whitaker and the late Arturo Gatti.

But when the pool of television dates dwindled and the competition to promote top boxers stiffened, Main Events struggled. For decades, Main Events had succeeded by signing dozens of young fighters, developing them, and cashing in on the few who made it big.

As fighters started bolting for other promoters who offered signing bonuses and a more likely road to dates on HBO, the company’s CEO, Kathy Duva, began to reconsider its strategy. When one of her more marketable fighters, Rocky Juarez, made it to HBO, lost the fight, and still landed what Duva says was a $300,000 signing bonus to jump to Golden Boy, she became convinced she had to trim the herd and go back to the company’s roots.

“I decided let’s get rid of everybody who isn’t making money and let’s just sign people who can sell tickets in arenas,” Duva said. “That’s something I know how to do that most of my competitors didn’t know how to do.”

As Duva was coming to that realization, a spectacular new hockey arena was about to open in Newark, N.J. She had met with the developers dating back to the earliest days of the arena push, sharing ideas on how boxing could be part of the mix, and continued the discussions with New Jersey Devils owner Jeff Vanderbeek after the building opened.

Duva knew it would take a headliner who was right for the market. Late in 2008, she found one.

Tomasz Adamek was coming out of a contract with Don King. Adamek, who is Polish, looked to be the ideal fit for Newark, appealing to fans from the many Polish-American neighborhoods in northern New Jersey and New York.

But there was a rub. Adamek’s upcoming title defense was against a Don King fighter, Steve Cunningham. In order to land the fight, Duva would have to either outbid King, or strike a deal with him. Her company lacked the cash to do either.

When Duva explained that to Vanderbeek, he offered a solution, providing her with the financing for that first fight. “He believed in us and he backed us and I will be grateful forever for it,” Duva said.

A boost for boxing?

The Turnkey Sports Poll asked in May: What will be the effect on interest in boxing from scheduling major bouts at nontraditional venues such as Cowboys Stadium and Yankee Stadium?

Source: Turnkey Sports Poll, produced by Turnkey Sports & Entertainment in conjunction with SportsBusiness Journal. The survey covered more than 1,100 senior-level sports industry executives spanning professional and college sports.

That first bout sold about 3,000 tickets and fell just short of breaking even, Duva said (New Jersey boxing regulators denied requests for financial records). The next one drew about 5,000. The third got about 10,000.

Putting on cards under the “Brick City Boxing” brand, the Prudential Center and Main Events have worked to cultivate a fan base that can cross over beyond Adamek. Recently, Duva struck a deal to promote Zab Judah, a popular former welterweight champ who is attempting a comeback.

Duva consulted with arena management before linking with Judah and the two staffs quickly began brainstorming ways to build his profile in Newark.

“The key to the partnership was that she had a very willing partner in us,” said Rich Krezwick, president of Devils Arena Entertainment at the Prudential Center. “Any boxing card today is a risky proposition. And unless there’s a true partnership between the promoter and the building, you’re not maximizing it. When you share risk and reward, you really maximize the efforts of both the promoter and the building.

“We’re in this together.”

It has been that way from the beginning. When Duva landed Adamek the fight with Cunningham, Newark’s Pulaski Day parade was only a few days away. Working with Adamek’s well-connected adviser, they managed to get both fighters on a float. Staff from Main Events and the arena canvassed the parade route, handing out flyers.

“It’s very old school, but that, frankly, is what this is about,” Duva said. “And it’s one place where a lot of promoters couldn’t compete with us. There are promoters whose fights are on TV a lot, but if they had to go sell a ticket, wouldn’t know where to begin.

“We’re not flying all over the country putting fights in casinos anymore. It’s counterproductive. You expend energy and time and you’re not building anything you can go back to and count on. If a fighter loses — and they all eventually lose — they’re not so interested in you in Vegas. We know we can always come back here.”

Changes come slowly

Top Rank is back in a big venue on June 26, when Julio Cesar Chavez Jr. and Marco Antonio Barrera share a pay-per-view card at San Antonio’s Alamodome, where Pacquiao beat Jorge Solis, a Mexican fighter, three years ago in front of an announced crowd of 14,793. It will be the first boxing card at that building since then, and only the fourth in the last dozen years. This in a city where more than half the population is of Mexican descent.

As Arum spoke of the power of the card, the next generation of Top Rank management, Duboef, stood nearby, accepting congratulations on a night filled with electricity.

When Arum put Ali-Norton III on at the old stadium in 1976, Duboef, who is his son-in-law, was 8 years old. Many aspects of the fight game have changed since then. Most have left the sport smaller than it was. Arum and Duboef say they’re committed to changing this one back, though they know it will take time and may mean sacrificing some money.

“To think you can come in and do one night in one building and have it work — those are few and far between,” Duboef said. “Cowboys Stadium can do it. But other arenas and markets have to be developed and the consumer has to know there’s going to be a fight there.

“Is that an ambitious feat? Absolutely. But it’s one that you want to take on. After Dallas, you can feel it in your blood. You want to conquer the world.”