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Ok folks, time for "Boxing Economics 101". Let me just say that there is "NO WAY" that the Mayweather-JMM fight is going to generate that kind of GUARANTEED money. To understand this though, you need a basic understanding of PPV revenue. Lets just say for arguements sake the fight does 750k buys, at $50. Thats a TOTAL GROSS REVENUE of $37.5 million. Now here's what happens.......
MINUS approx. 40% to the cable distributors leaves $22.5 million
MINUS approx 10% of the gross to HBO PPV for production leaves $18.75 million.
PLUS lets say it does either $5-6 million at the gate, or they play it safe and take a site fee for $3-4 million. (they dont get both)
Lets say that the gate puts the total net back up to around $22 million
The overseas rights money would probably offset all the other promotion expenses (undercard, travel, advertising, insurance, commission/officials fees, etc.), so thats probably a break even. (neither fighter has a strong, proven, overseas PAYING audience)
So, assuming there are 750k domestic buys, there is a total of approx. $22 million in revenue, and that also has to feed the promoters.
The point is that if the story about $30 million in purses being GUARANTEED were true, that would mean the following: As the LEAD promoter, Mayweather promotions would be responsible for these guarantees. Does anyone really believe that Floyd would essentially be giving JMM a 50-50 split for anything up to 750k buys? If you believe that, then I have a bridge to sell you.........
p.s. yes, I know there are other revenue streams that will generate some additional monies (HBO buying the rebroadcast rights, sponsor money, etc.) but they dont add up to enough to really change these figures by much. At best maybe a million or 2.
Summary: If JMM got a $10 million guarantee, then his management is absolutely brilliant, because it would mean that if the show did anything under 750k buys, then JMM would be making more money than Floyd.
MINUS approx. 40% to the cable distributors leaves $22.5 million
MINUS approx 10% of the gross to HBO PPV for production leaves $18.75 million.
PLUS lets say it does either $5-6 million at the gate, or they play it safe and take a site fee for $3-4 million. (they dont get both)
Lets say that the gate puts the total net back up to around $22 million
The overseas rights money would probably offset all the other promotion expenses (undercard, travel, advertising, insurance, commission/officials fees, etc.), so thats probably a break even. (neither fighter has a strong, proven, overseas PAYING audience)
So, assuming there are 750k domestic buys, there is a total of approx. $22 million in revenue, and that also has to feed the promoters.
The point is that if the story about $30 million in purses being GUARANTEED were true, that would mean the following: As the LEAD promoter, Mayweather promotions would be responsible for these guarantees. Does anyone really believe that Floyd would essentially be giving JMM a 50-50 split for anything up to 750k buys? If you believe that, then I have a bridge to sell you.........
p.s. yes, I know there are other revenue streams that will generate some additional monies (HBO buying the rebroadcast rights, sponsor money, etc.) but they dont add up to enough to really change these figures by much. At best maybe a million or 2.
Summary: If JMM got a $10 million guarantee, then his management is absolutely brilliant, because it would mean that if the show did anything under 750k buys, then JMM would be making more money than Floyd.
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