Thursday, December 17, 2015

Is It Time For “Big Time” Boxing To Go Over The Top?

When the concept of pay-per-view television is discussed it is hard not to associate it with the sport of Boxing. Since the initiation and growth of cable/satellite pay television in the 1970s and 1980s, many of Boxing’s marquee “Big” or “Super” fights have often been showcased live on pay-per-view.

In many ways, it was a natural progression for the sport. After all, prior to the advent of cable/satellite pay television many of the sport’s big events were either broadcast live via closed-circuit television at various locations or were shown on free over the air (OTA) broadcast television. In some instances fights were shown live only via closed-circuit and then shown on broadcast television on a delayed basis.

As technology continued to evolve however, more options were presented to the consumer by way of the cable/satellite pay-TV medium. Gradually as the concept of pay-per-view began to take shape it was only natural that Boxing would be featured prominently with the sales hook of “You can see this fight in the comfort of your own home by ordering from your television provider!”

Many Boxing fans will remember some of the marquee pay-per-view Boxing events of the 1980s featuring such fighters as Sugar Ray Leonard, Thomas Hearns, Roberto Duran, and Marvelous Marvin Hagler often referred to as Boxing’s “Fab 4.” Although many of those fight cards were also shown via closed-circuit television, particularly in areas where cable/satellite pay television was not yet available, it was not long before many of Boxing’s biggest events would become pay-per-view exclusive.

As the years went on the number of pay-per-view Boxing cards naturally increased. Some may remember the initial launch of TVKO, a division of Time Warner Sports, which launched in 1991 as the first “Pay-Per-View Boxing Network.” TVKO was the first to offer a pay-per-view Boxing card on a monthly basis often marketed as “The Fight Of The Month” featuring a variety of fighters and showcasing weight classes in headlining positions that were previously not in main events on pay-per-view cards. What was particularly appealing about the monthly pay-per-view cards done by TVKO was that the prices of those cards were often affordable for consumers many being priced under $30.

As innovative as the original concept of TVKO was however, the monthly pay-per-view cards did not last for a long period of time. TVKO eventually became more incorporated with its sister network HBO and ultimately became known as HBO Pay-Per-View. As the years went on Boxing continued to be a mainstay on pay-per-view. An argument can be made however, that as the years went on the concept of offering Boxing cards on a pay-per-view basis at an affordable price to the consumer began to become less frequent.

In recent years many of Boxing’s “Big” or “Super” fights have been priced between $50-$70 or above. The most expensive pay-per-view Boxing card to date was in May of this year when the long-awaited battle between Floyd Mayweather and Manny Pacquiao took place after years of anticipation. The fight, which broke all existing pay-per-view records was priced at $100 for the high definition broadcast and $80 for the standard definition broadcast.

In fairness, Mayweather-Pacquiao was the definition of what a “Big” or “Super” fight is supposed to be in the build up to it. The event generated 4.4 million pay-per-view buys in the United States and over $400 million in pay-per-view revenue. Many of the sport’s pay-per-view attractions prior to that fight however, had underperformed regardless of who was in the main event. Whether or not that was due to a perceived lack of quality of the fight cards themselves or the gradual increase in the price for pay-per-view events over the years is a subject to debate. Although the Mayweather-Pacquiao fight shattered all existing records and proved that when there is significant interest in a fight, the public will support it no matter what the cost might be, the actual fight failed to live up to expectations and left many feeling disappointed.

In the months since Mayweather-Pacquiao, there have been a few significant pay-per-view attractions that have taken place in the sport. Mayweather himself returned to the ring in September scoring a twelve round unanimous decision in what he insists was his last fight over former Welterweight world champion Andre Berto in a bout televised on pay-per-view.

As has been the case with several pay-per-view Boxing cards in recent years, the Mayweather-Berto card one might argue underperformed as a pay-per-view attraction generating between 400,000-550,000 total pay-per-view buys. In October, a unification bout took place in Boxing’s Middleweight division between undefeated unified world champion Gennady Golovkin and IBF world champion David Lemieux.

Although this was the second pay-per-view card in the United States to feature Gennady Golovkin as the main attraction, after previously knocking out Nobuhiro Ishida in the main event of a pay-per-view card in March 2013, it was the first time that Golovkin headlined a pay-per-view card broadcast by HBO Pay-Per-View. Golovkin’s dominance of the Middleweight division continued as he stopped a “Game” David Lemieux to add the IBF world championship to his unified WBA/IBO Middleweight crown. The fight generated over 150,000 total pay-per-view buys. Even though some might say that figure is one that could be described as underperformed, it is important to remember that Golovkin is a rising star in the sport and has been for several years and is a fighter in need of a fight against someone most consider to be a legitimate star of the sport. If Golovkin can continue to win it is only a matter of when and not if that opportunity against a star of the sport will come.

Two such stars did battle in November in what should be considered the biggest fight since Mayweather-Pacquiao, when multi-division world champion Miguel Cotto and Saul “Canelo” Alvarez met for the WBC Middleweight world championship. In a fight that lived up to expectations, Alvarez became a two-division world champion defeating Cotto by twelve round unanimous decision. In contrast to several pay-per-view Boxing cards that underperformed in recent years, Cotto-Alvarez should be considered a success generating 900,000 pay-per-view buys and $58 million in pay-per-view revenue.

As successful as Mayweather-Pacquiao and Cotto-Alvarez were as pay-per-view attractions however, there is no doubt that there has been a steady decline in cable/satellite pay-per-view buys in recent years for the sport of Boxing. Whether or not the overall growth of pay-per-view Boxing as a whole with many fighters and promoters looking to pay-per-view rather than a cable or broadcast network to televise their fights, the perceived lack of quality of the cards in the eyes of fans, or the steady increase in pay-per-view prices could all be contributing factors to the decline of interest in pay-per-view cards are all things to debate.

Another contributing factor however, may not be a general lack of interest among consumers/Boxing fans, but rather the general decline of the cable/satellite industry as a whole. In recent years a new medium has gradually gained momentum among consumers who have subscribed to several entertainment services distributed on an Over The Top (OTT) basis. In short, OTT simply means the delivery of audio, video, and other forms of media content over the Internet without a multi-system operator, like a cable/satellite provider to act as the distributor of content to the consumer.

Many are likely aware of the success of subscription OTT services like Netflix and Hulu which have steadily grown in popularity among consumers due in large part to each service offering a variety of content including movies, TV shows, and original programming all on-demand. Each service is reasonably priced between $8-$10 per month depending on one’s chosen subscription plan.

Some may also be familiar with the success of WWE, a longtime key player in the pay-per-view television industry that chose to launch their WWE Network exclusively on an OTT basis in the United States as well making their network available around the world either on an OTT basis or as a cable/satellite network. What made WWE’s decision to bypass the traditional cable/satellite method of distribution truly groundbreaking was they chose to make all their monthly pay-per-view events available to network subscribers at no additional cost. For the price of $9.99 per month subscribers have access to not only a live twenty-four seven linear streaming channel, but also a vast on-demand library.

Although WWE faced much criticism prior to the launch of their network in February of last year, particularly among cable/satellite providers for choosing to offer the network on a direct to consumer model via OTT distribution, the network has proven to be successful averaging well over one million subscribers with estimates expecting to grow as the network continues to expand internationally. The sport of Mixed Martial Arts (MMA) has also entered into the OTT realm as the Ultimate Fighting Championship (UFC) launched its UFC Fight Pass service in December 2013.

Much like WWE Network, UFC Fight Pass offers both live content as well as an extensive on-demand library for $9.99 per month. One key difference between the two services however, is the UFC still offers its pay-per-view cards live via cable/satellite providers with Fight Pass subscribers being able to access those cards as part of their subscription on a delayed basis. Whether or not the UFC will eventually follow the lead of WWE and offer their pay-per-view content live as part of their Fight Pass service remains to be seen. It is clear however, that both the WWE and UFC have shown that they can thrive in a realm outside of the cable/satellite medium.

With the success of WWE, the UFC, as well as entertainment services like Netflix and Hulu, should Boxing be the next to go Over The Top? In recent years OTT digital networks like GFL: Go Fight Live Combat Sports, EverSport, and others have established themselves as players in the sport carrying Boxing cards from around the world on a pay-per-view basis to consumers. Although the prices for such cards can vary, they are considerably more affordable and typically offer more fights per card than most pay-per-view cards that have been offered via cable/satellite in recent years.

As successful as networks such as GFL and EverSport have been however, has the time come where one of Boxing’s “Big” or “Super” fights should be offered on an OTT basis? This observer believes that many consumers who have “Cut The Cord” by canceling their cable/satellite pay-TV services in favor of OTT television would welcome the opportunity to see a marquee Boxing event that would otherwise only be available via cable/satellite pay-per-view if offered on an OTT basis.

Although some might doubt whether or not the sport of Boxing may be able to come up with a subscription-based OTT network model that would offer both live programming as well as on-demand content, this observer believes a good model for a potential OTT network for the sport of Boxing can be found in the United Kingdom’s BoxNation. BoxNation launched in July 2011 as a twenty-four seven cable/satellite Boxing network available in the United Kingdom and Ireland showcasing not only live fights from around the world, but also a variety of content including classic bouts and magazine style programming. BoxNation is available for €12 a month (Roughly $13 U.S.).

Even though I believe that the model of BoxNation would be perfect on an OTT basis for the sport, it will boil down to whether or not Boxing promoters around the globe will be willing to support a network exclusively devoted to Boxing, which would offer both live and on-demand content on an OTT basis. With the OTT market continuing to expand with hardware developers such as Roku, Amazon, Apple, and others all releasing OTT hardware to consumers and with the trend gradually moving away from the cable/satellite TV medium, I believe it is time for Boxing to look for a way to transition into the OTT realm.

Although the concept of what is known as pay-per-view may never truly go way, it is clear not only by the continued decline of the cable/satellite industry, the continued decline of traditional cable/satellite pay-per-view television as it relates to not only Boxing, but other genres as well, as well as the growing popularity of the Premier Boxing Champions series, a series showcasing free fights across both broadcast and cable television, that is time for “Big Time” Boxing to look into the future. Even though seeing Boxing’s next “Big” or “Super” fight offered on an OTT basis to consumers may appear to be wishful thinking in the eyes of some, as the trend of “Cord-Cutting” continues to grow one can only imagine the potential audience that Boxing’s next marquee event could be missing out on. It is something that the powers that be in the sport should consider.

“And That’s The Boxing Truth.”

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