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By Thomas Hauser
2015
Sources say that Haymon is considering transitioning to an online subscription service that would bypass television networks and PPV carriers by dealing directly with consumers. Toward that end, he has hired Alex Balfour (who was head of new media for the London Olympic Committee). Balfour is believed to be soliciting applications from potential employees who would like to work for the subscription venture. Balfour’s website (www.alexbalfour.com) says that he is “currently the Chief Digital Officer of a new, exciting, start up in sport.” The above plan is similar to a twenty-four-hour-a-day subscription Internet channel that World Wrestling Entertainment launched earlier this year.
The cost to subscribers for the WWE channel is $9.95 per month. But subscriptions have fallen far short of expectations and, because of operation and programming costs, WWE is expected to lose at least $40,000,000 during the coming year. That poor performance is a major reason why WWE stock has dropped by more than 60 percent (a loss in market value in excess of one billion dollars) since March of this year. But launching a subscription channel might not be Haymon’s ultimate goal. His endgame after that could be taking the company public pursuant to a plan whereby he and the initial investors would reap significant gains through a public stock offering.
But—and this is a big but—going public means a different standard of disclosure and more stringent ethical requirements for the conduct of business. Whatever the plan, one thing is clear. Haymon isn’t doing this as a charitable venture. A significant portion of the investors’ money that will be spent in the near future is likely to be spent on content (i.e., fight cards provided by Haymon). The investors might do well. Or the investors might lose a lot of money.
2015
Sources say that Haymon is considering transitioning to an online subscription service that would bypass television networks and PPV carriers by dealing directly with consumers. Toward that end, he has hired Alex Balfour (who was head of new media for the London Olympic Committee). Balfour is believed to be soliciting applications from potential employees who would like to work for the subscription venture. Balfour’s website (www.alexbalfour.com) says that he is “currently the Chief Digital Officer of a new, exciting, start up in sport.” The above plan is similar to a twenty-four-hour-a-day subscription Internet channel that World Wrestling Entertainment launched earlier this year.
The cost to subscribers for the WWE channel is $9.95 per month. But subscriptions have fallen far short of expectations and, because of operation and programming costs, WWE is expected to lose at least $40,000,000 during the coming year. That poor performance is a major reason why WWE stock has dropped by more than 60 percent (a loss in market value in excess of one billion dollars) since March of this year. But launching a subscription channel might not be Haymon’s ultimate goal. His endgame after that could be taking the company public pursuant to a plan whereby he and the initial investors would reap significant gains through a public stock offering.
But—and this is a big but—going public means a different standard of disclosure and more stringent ethical requirements for the conduct of business. Whatever the plan, one thing is clear. Haymon isn’t doing this as a charitable venture. A significant portion of the investors’ money that will be spent in the near future is likely to be spent on content (i.e., fight cards provided by Haymon). The investors might do well. Or the investors might lose a lot of money.
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