In a heavyweight financial standoff with pay-per-view
distributor In Demand, Showtime Event Television will scrap its proposed March 25 Mike
Tyson-Lou Savarese PPV event and instead show an April Tyson bout on Showtime pay TV,
executives said last week.
Future PPV fights featuring once-reliable meal ticket
Tyson- as well as fights from boxing promoter Don King - may be jeopardized if In Demand
continues its hard-line stance on fight rate cards, SET executives and King said.
In Demand executives replied that they never had an
opportunity to negotiate a deal beyond an initial proposal for the event, and they remain
willing to talk with SET about future PPV events.
At issue, according to SET and King, is In Demand's cut of
revenue generated from major boxing matches.
Prior to its changeover to In Demand last year, Viewer's
Choice would take about 2 percent of revenue out of the promoter's 50 percent
cut, while operators received 50 percent, sources close to the situation said.
Jump to Page 2 Now, according to SET executive vice
president of corporate strategy and communications Mark Greenberg, In Demand wants as much
as triple that amount to distribute the Tyson-Savarese fight.
With SET unable to negotiate what it believes is an
equitable deal, the fight will instead appear on the Showtime pay TV network sometime in
Greenberg also said In Demand, on cable operators' behalf,
wanted to run fewer promotional spots for the fight than SET wanted.
King, upset at In Demand's demands, said he would consider
taking future fights to closed-circuit arenas or some other alternative distribution
method if the company continues to play hardball in negotiations.
"I'm open to doing business with them, and we want to
work it out," King said. "But what In Demand is doing is not good for the
industry, the sport or the operators."
SET wanted Tyson-Savarese to be the last fight
of a four-Tyson-fight deal between SET and Viewer's Choice three years ago, beginning with
the first Evander Holyfield-Tyson fight. But In Demand balked, saying that the terms
attached to those earlier fights were inappropriate, given Tyson's current diminished
Tyson-Savarese would have been similar to SET's agreement
for the Tyson-Frans Botha fight in January 1999.
"In Demand wanted to triple the fee it received from
Tyson-Botha for the March event," Greenberg said. "It put us in a position where
it was a disincentive to put it on PPV."
In Demand president Mindy Herman responded that her company
had no opportunity to negotiate further with Showtime. While not revealing specific
figures, Herman said, In Demand's initial proposal had "numerous components"
that were all open to negotiation had Showtime sat down with the PPV network.
"We were willing to sit down and negotiate with SET
for the fight, but we weren't given the opportunity to do so," she added.
She said In Demand's proposal for the Tyson-Savarese fight
reflected the current appeal of Tyson on PPV. Tyson's last PPV event against Botha fell
far short of industry expectations, generating 700,000 buys - well short of the two
Tyson-Holyfield fights, which pulled in close to 4 million buys combined.
Since the Botha bout, Tyson's boxing image took several
more hits. He spent several months in jail on a road-rage assault charge last spring, and
he was involved in a controversial fight in October, when he hit opponent Orlin Norris
after the bell.
"The benchmarks that were created for the Tyson-Botha
deal did not make sense for the industry at this time. They were based on past Tyson
performances," Herman said. "It didn't reflect the reasonable Column
Wrapprojections of the Tyson-Savarese event, and we have to structure the fight properly
for the industry."
But Greenberg contended that Tyson is still a major draw.
Showtime pay TV's tape-delayed broadcast of Tyson's Jan. 29 knockout win against Julius
Francis drew near-record ratings, for example.
"Tyson's in six of the top 10 fights of all-time. If
you want to work with us to build him back to prominence, work with us. But fundamental
issues of promotional activities and fees have to be addressed," he said. "We're
not a nonprofit organization, and I'm not going to subsidize a competitor."
The dispute isn't the first between SET and In Demand. SET
was also displeased with its deal with In Demand for its March 3 Felix Trinidad-David Reid
In that case, Greenberg said, In Demand significantly
increased its licensing fees compared with prior boxing events. Given the short
marketing and promotional window for the event, SET reluctantly accepted the terms that
King said he thinks In Demand wants to eliminate
distributors like SET and TVKO by talking directly with fighters and boxing promoters
about television deals. "There seems to be a lot of ambition driving In Demand,"
Herman denied that accusation, adding that several boxing
promoters had actually contacted In Demand when the company launched its entertainment
division last month. Nevertheless, she said, the company has no plans to compete with
Showtime and TVKO for marquee fights.
"We are very happy with our relationships with TVKO
and SET. We have no plans to become a boxing-event supplier, and we have no desire to
supplant those companies and change the market," Herman said.