Events Struggle to Recapture Past Glory


When Mike Tyson and Lennox Lewis faced each other in a blockbuster heavyweight championship pay-per-view boxing event in June 2002, the bout garnered a record 1.8 million buys and $106.8 million in revenue.

Fast-forward to today: The industry has not come close to replicating Tyson-Lewis’ standard-bearing performance. The retirement or decline of several boxing and wrestling PPV stars; the inability of other event genres, like concerts and niche sports, to expand beyond their hard-core fans; and the rapid growth of other technologies such as video-on-demand have all conspired to cripple what once was one of cable’s most lucrative incremental revenue sources.

Since 1999, when PPV events drew a record $486 million in revenues — representing 49% of all PPV or VOD revenue for the year — the category has been in steady decline. While the totals aren’t in yet for 2003, the PPV-event category only accounted for a mere 30% of the PPV/VOD take for the year, according to In Demand.

Industry executives cite the lack of marquee PPV events as a reason for the category’s overall drop-off. Boxing and wrestling have always carried the event category, but the fading appeal of aging stalwarts like Tyson and former heavyweight champion Evander Holyfield, as well as the drop in drawing power of such wrestling icons as Hulk Hogan and Stone Cold Steve Austin, have crippled the industry.


While there aren’t as many big events as in the past, other industry executives point to the lack of marketing support behind the category.

Operators are focusing more resources against VOD, telephony, broadband and other businesses.

“It’s been the advent of HDTV and VOD that has led to further dilution of the event category,” Showtime Sports and Event Programming senior vice president and general manager Ken Hershman said.

The marketing fallout has even affected consistent revenue generators like World Wrestling Entertainment.

While the grappling organization said it received great promotional support from the industry for its 10-month Wrestlemania XX marketing campaign, overall operator commitment has waned from the late 1990s.

“I don’t think that generally they’re as supportive as they were for PPV [events],” said WWE chairman Vince McMahon. “It’s fair to say their interests are in other areas, which is where we’re going with some new products for operators,” including its WWE 24/7 subscription VOD service, which launched last month.

WWE will also add two more pay-per-view events to its monthly lineup of PPV shows, McMahon said. MSO and satellite executives say they’re willing to put the resources behind blockbuster PPV events.

“There is a general trend of marketing numerous products as we roll out beyond cable,” Comcast vice president of marketing, new video services Page Thompson said. “But I assure you if we had an event of the caliber of a Tyson-Lewis event we would put substantial resources behind it.”

DirecTV Inc. senior vice president of programming acquisitions Michael Thornton also said the direct-broadcast satellite leader remains bullish and supportive of the PPV event category, and has put significant marketing dollars behind both midsized and smaller exclusive PPV concerts and sporting events.

In Demand president and CEO Steve Brenner said the marketing issue is more a case of the industry waiting for a big event.

“Operators are not going to promote a fight that’s not compelling, but for Tyson-Lewis, there was a tremendous promotional effort by the industry,” he said. “But for another concert, which is nothing extraordinarily special, you won’t see a tremendous amount of effort against it.”

Yet lining up that blockbuster PPV event is easier said than done, according to event providers. Given the diminishing returns and a 50% split structure with distributors, it’s difficult to justify spending millions on top talent.

Showtime’s Hershman said the company decided PPV was too much of a risk for its live Britney Spears concert this past March, which instead aired on the Showtime pay TV network.

“With the economics remaining as non-compelling as they are, and with the unwillingness of the distributors to even consider changing that in any way, the industry has forced events like Britney from what would normally be PPV to Showtime,” Hershman said.

Worse for distributors, Hershman said the music performers themselves have become disenchanted with the PPV-event category and would rather get a fee than assume the risks tied to buy-rate performance.

But Brenner said operators won’t have much incentive to promote events if percentages were to fall.


Despite the discrepancy over splits and the lack of compelling events, operators say the PPV category remains vibrant. First-quarter revenues improved, due in large part to accumulated buys for smaller PPV events aired on In Demand and TVN Entertainment’s respective 24-hour PPV event channels.

“In Demand is offering 24/7 event channels, which have offered more events, and we’re receiving more revenue — more people are going to it and buying events,” said a Time Warner Cable spokesman.

Comcast’s Thompson said PPV event buys through the In Demand channel — as well as increased usage of its VOD movie offerings — have more than made up for the lack of huge buy-rate events.

“As on-demand is taking off, we’re not seeing any weakness in the pay-per-show category,” he said.

Reality is one genre that is building a following. Shows like last Feb. 1’s Lingerie Bowl, in which scantily-clad models competed in a full contact pigskin game that aired against CBS’s Janet Jackson breast-baring Super Bowl halftime show, are generating five-figure buy numbers.

TVN’s Sylvester also pointed to the emergence of uncensored episodes of Jerry Springer and Blind Date as a potentially lucrative arena.


While no current heavyweight champion has emerged as a viable draw, Home Box Office Sports president Ross Greenburg said some strong PPV boxing cards are on tap.

Beginning with the May 15 Roy Jones Jr.-Antonio Tarver Jr. light heavyweight championship rematch, Greenburg said that HBO PPV will look to offer at least one major PPV event per quarter the rest of the year.

In June, the network will distribute an Oscar De La Hoya Jr.-Bernard Hopkins doubleheader event, with the two fighters set to meet on Sept. 18, if victorious. Moreover, the return of former junior middleweight champion Felix Trinidad is scheduled for October.

“Boxing just needs some big events for people to focus on … if you build it they will come,” Greenberg said.

ESPN’s new PPV arm may also look to enter the boxing ring with a number of events to complement its mixed martial arts and subscription out-of-market college basketball and football and Major League Soccer sports packages, said ESPN vice president of broadband and interactive sales Matt Murphy.