Manny Pacquiao has transformed himself into a boxing legend by pushing the limits of the sport. Now he’s hoping to push the limits of the pay-per-view audience as well.
After staging his last eight fights on HBO-PPV, Pacquiao and promoter Bob Arum crossed the street and agreed to join forces with SHOWTIME-PPV and CBS for Pacquiao’s May 7 title defense against Shane Mosley, a decision that stunned HBO officials and left many in boxing thrilled that someone had finally thumbed their noses at them after the arrogant and cavalier way they have treated both the sport and its practitioners in recent years.
“The irony is even Arum’s enemies are celebrating,’’ one well respected industry insider said yesterday. “I’m happy for Arum and for boxing but that doesn’t change how I think about him. I think he’s a snake but he’s an intelligent snake. If it works, maybe we’ll be building a sport again.’’
If that’s the case then this was not only a brilliant business move for Arum, Pacquiao and Mosley but perhaps a life-saving one for the sport, which has struggled for years in the U.S. to expand its shrinking audience.
HBO did little to help in that regard, seemingly being content to use the largest checkbook in the industry to cherry pick boxing’s biggest events while doing next to nothing to grow the sport or fully service its subscribers by giving them the best fights money could buy without regard to who was selling them those fights.
Clearly in bed with Golden Boy Promotions and Los Angeles fight manager Al Haymon for reasons most boxing insiders never fully understood, HBO has for many years now believed it had a virtual monopoly on the fight game, at least at the top end which was the only end they have cared about since Seth Abraham and Lou DiBella left.
But Arum’s quiet negotiations with SHOWTIME opened up a door long closed to his company, Top Rank Promotions, and brings the full power of CBS and terrestrial television’s larger universe into play not only for selling this fight but also to help spur the lesser promotion of Miguel Cotto vs. Ricardo Mayorga earlier in the year.
“HBO does a fine job distributing pay-per-view,’’ Arum said from his Las Vegas office. “I have no complaints with that. The problem is the limit of HBO’s universe.
“They reach about 28 million homes. Now we will have our message on one platform that reaches 115 million homes. We’ll be able to get many more people involved in this promotion. HBO has for too long been satisfied to limit it (promotions) to its platform.’’
Arum admits to having had a poor relationship with SHOWTIME, which had grown to believe promoters like Arum would come to them only to drive up the asking price at HBO before ultimately taking their fights there. But over nine months of subtle and often behind the scenes negotiations built on his long-standing relationship with CBS boss Les Moonves ultimately led to a deal that will bring Pacquiao-Mosley exposure on prime time CBS shows as well as ad spots during the NCAA basketball tournament in March and April.
Top Rank president Todd DuBoef, Arum’s step-son, was a driving force behind the concept, believing such a partnership with CBS and SHOWTIME would open the far wider doors of terrestrial (free) TV to boxing, which grew its sport on free television exposure in its last glory days of the 1970s and ‘80s.
“Todd realized more so than I did that boxing was being diminished by the (shrinking) size of its universe (primarily on premium cable outlets HBO and SHOWTIME),’’ Arum said. “In 1978 I did Ali-(Leon) Spinks in New Orleans. The rights fee from ABC was $5.5 million. That’s more than HBO pays for a fight today so don’t tell me it can’t be done (boxing on free TV). It can’t be done if we can’t sell sponsors but we’ll sell sponsors. I believe this fight, this arrangement, is a sea change in the sport of boxing.’’
Certainly it’s a shocking change for HBO Sports, whose president Ross Greenburg tried to make last gasp efforts to negotiate a deal with Arum. But those efforts came long after the SHOWTIME-CBS deal was nearly completed in large part because HBO never thought it could happen.
Outworked, out-flanked and out-foxed by Arum, Moonves, SHOWTIME CEO Matt Blank and its boxing guru Ken Hershman, Greenburg came up empty, losing the sport’s biggest draw to its biggest rival in a move that, Arum hopes, will shake up the cable giant in a way that does not lead to the usual back-biting, counter programming and revenge–seeking so familiar to televised boxing’s oddly run business.
“This is all about relationships,’’ Arum said. “It couldn’t have been done a year ago (by his company and SHOWTIME). SHOWTIME would have thought we were just using them to leverage HBO. That’s the mistrust they had. I can’t blame them. I understand.’’
Arum’s company will work to bring sponsors to the event, an effort Arum believes will convince network television executives that the sport can be sold for a profit. As part of the deal, CBS will give both ad spots and live coverage during CBS programming and will run either the first or last episode of a four-part promotional countdown to the fight show on CBS in prime time (the others will run on SHOWTIME). In addition, Top Rank will be allowed to sell ad spots that help cover the production costs of that show.
Some of the undercard fighters, including the most recognizable female fighter in history, Christy Martin, will be placed on CBS talk shows; the CBS Morning Show will broadcast from Las Vegas the week of the fight and plug the event; and “60 Minutes,’’ which is still one of the most watched shows on television, will do a follow up to an earlier Pacquiao feature on May 1, airing six days before the event.
The belief is that kind of exposure on terrestrial television will drive up interest in the fighters and their stories and hence drive more viewers to buy the event on SHOWTIME PPV.
The driving force in all this, in addition to the vision of DuBoef and Arum, is the popularity of Pacquiao. He is not only the sport’s best ambassador and most well-known personality but has become someone Moonves, for one, is fascinated with, according to Arum.
“If we didn’t have Manny I don’t believe they would have listened,’’ Arum conceded. “This puts oil in the engine and then it’s ready to go but the second thing has to happen. Sponsors have to flock to the sport. I believe they will because we’ll help them sell to them.
“For years network executives have said they can’t get sponsors. They can’t get sponsors because their sales staff doesn’t know how to sell boxing. They haven’t done it in years. Once they see there is sponsor money for boxing they damn well will come back to boxing but they’re not going to do that naked. It’s easier for them just to go sell the NFL.
“We have a certain number of spots that are ours and we have good relationships with a lot of sponsors. We’ll sell them and we’ll help them sell their ads to sponsors. They’re going to see the sponsors’ support for it. Once that happens it’s a new day for boxing.’’
Certainly the sport needs something to jump start it in the U.S. Exposure on free TV has long been seen as the antidote for its flagging place in the American sporting landscape and this move at least begins the process.
How HBO executives react long term is the other significant issue. Long dominant in the sport, HBO seemed to grow both fat and disinterested in working to grow the sweet science, ignoring that end of the business until the entire sport had turned sour.
Greenburg and vice-president of programming Kery Davis began more and more to gravitate to Oscar De La Hoya’s promotional company and to Haymon, a manager without the title who represents Floyd Mayweather, Jr. and a host of other boxers. Rival promoters would privately complain of double standards, citing numerous examples of an opponent being rejected for one of their fighters or HBO refusing to use one of their boxers only to see them later accepting the same people once Golden Boy or Haymon became involved.
Yet for all the griping only a handful of boxing promoters and managers were willing to go public with their criticism. Chief among them have been Arum, King and DiBella, three of the sport’s largest promoters.
King and Arum have dominated the fight game for more than 30 years but each saw their influence and their relationships with HBO on the wane. Both have been highly critical of Greenburg and his way of doing – or not doing – business and claimed he had tipped the playing field wildly in favor of De La Hoya’s company.
HBO has always denied this but the proof has been in the fights. HBO has spent more and more and gotten less and less as it began to all but turn its boxing programming over to De La Hoya’s company with only scattered exceptions.
Arum termed Greenburg’s initial response to his call announcing he had taken Pacquiao-Mosley to SHOWTIME-CBS as “curt’’ but then added, “Then the adults took over and they’ve been very gracious. They’ve wished us well.’’
According to Arum, HBO could do something similar by using its alignment with TBS and TNT and by lining up a shared deal through Comcast with NBC, which Comcast recently consumed. The key for HBO going forward, he said, is that “they have a lot of ways to go if they aren’t arrogant.
“If they try to take retribution against us I’ll find a way but I don’t think they will. If they do, it’s too bad for their subscribers.’’
Arum said he had to convince both Mosley’s camp and Pacquiao’s to sign off on the deal because even though their guarantees remained unchanged from what HBO would have provided the gamble is on the size of the pay-per-view sales. HBO has a long established track record of what kind of sales its major pay-per-view events deliver. While Arum insists the far wider exposure the fight will get through the CBS connection will increase business, the proof will be in the numbers.
“I would not have done this on my own,’’ Arum said. “I would not have done this without the fighters' endorsement. They didn’t suffer any diminution of their guarantees but it’s a risk. If it works, there is an upside advantage. If it doesn’t, their upside is impacted. They both told us to go for it. They are cheerleaders for this.’’
How this affects the future of boxing long-term remains to be seen. If Arum is right and terrestrial TV sees there is money to be made by a return to the fight game, the sport would be uplifted by regular exposure on the networks, which were long the sport’s staple.
How this affects HBO will depend on how they react to new competition in the marketplace. If the men who run HBO Sports are able to recognize how their actions – and frankly their arrogance – led to this they will be able to survive it and compete. If they try to punish Pacquiao in the short term or Arum and his company in the long term they will have done another disservice to both the sport and its subscribers, who have for too long been forced to swallow too many one-sided shows for which the cable giant vastly overpaid for what it got.
Whether a proper response to the new reality Arum is trying to create is something Greenburg can adapt to remains to be seen. Whether this new joint venture can produce bigger pay-per-view numbers does as well, but it would stand to reason that promoting the event in 115,000,000 homes rather than 28,000,000 will drive sales.
What boxing has to hope is that it also drives HBO Sports to do what it has done little of since Abraham and DiBella left: act in the best interest of the sport that has helped build its network rather than for the self-interest of a few.
“This is a repudiation of how HBO did business for the last decade,’’ another veteran industry operative said, while refusing to be quoted directly out of fear of HBO’s possible retaliation. “This will be interesting to watch on two levels.
“If it succeeds do the networks become more involved with the sport again, which is the key to reviving interest in boxing? There’s an eternal popularity to boxing if people just get to see the sport at its best.
“The other question is, how does HBO react? Do they make wholesale changes in how they do business? If not, they’ll continue to be marginalized.’’
Regardless of how HBO reacts, however, Bob Arum believes one thing has become clear both about boxing and the effects of HBO’s long-time dominance of its biggest names and biggest promotions.
“You cannot have a major sport limited to a universe of 28 million homes,’’ he said. “It can’t be done. Something had to change. I believe this (type of shared exposure on both cable and terrestrial television) is the way to do it.’’
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