DAZN's problem: They pay out PPV-caliber purses but don't earn PPV revenue

[rickJen]

Pot is the same as it's always been. Domestic broadcast, live gate, foreign rights, sponsorships, delayed broadcast, merchandise, etc.

If it's a 50/50 split, instead of splitting the US PPV profits like before, you split the license fee DAZN pays for the domestic rights.

Irrelevant nonsense.

[N/A]

Irrelevant nonsense.

Irrelevant how? You expressed confusion of how the pot is determined, so I explained it to you. My post was literally as relevant as it could have possibly been. I responded directly to you and provided the exact information you expressed a desire to obtain.

[rickJen]

Irrelevant how? You expressed confusion of how the pot is determined, so I explained it to you. My post was literally as relevant as it could have possibly been. I responded directly to you and provided the exact information you expressed a desire to obtain.

You know damn well that's common to boxing events in all platforms.
Question you should be asking yourself is why is PBC, being
in the game for decades, unable to match the offers Hearn/DAZN is giving out?
Why is it that you expect sky high offers when it comes to DAZN,
yet tolerate PBC in whatever they can give out?
Why is the pot bigger at DAZN and not at PBC?

[N/A]

You know damn well that's common to boxing events in all platforms.
Question you should be asking yourself is why is PBC, being
in the game for decades, unable to match the offers Hearn/DAZN is giving out?
Why is it that you expect sky high offers when it comes to DAZN,
yet tolerate PBC in whatever they can give out?
Why is the pot bigger at DAZN and not at PBC?

Don't move the goal posts now. Trying to change the subject in six different directions. You asked how there could be a "pot" when it's DAZN and not PPV. I explained how. I'm not going to get trapped in your troll games now.

[techliam]

Think there are several factors -

a) When building a new distribution channel, a fledgling business is expected to lose money for first 12+ months. Look at early Netflix financials, or Spotify stock. Since in last 10-15 years private equity became the goto financing instrument and DAZN is sponsored by PE, they're highly leveraged and don't expect to get the required ROI for 5-10 years - which includes losing money some of the time.
b) We may be underestimating how successful DAZN is at generating revenue. Let's say DAZN only has 1m subs, which (assume we can agree), and let's assume all of them subbed during the trial period at $100/yr. That's $100M for 12 months.
c) Then compare it to their spending. Canelo is a HUGE outlier. Their 2nd biggest star, G, makes what, $10-15m/fight? Then it falls off sharply from there. So if we assume that those 2 fight twice a year, that's ~$90M gone at worst. The rest of the guys don't make nearly as much, and sure, they'll cash out Kov and get G a good opponent for another $20M. Say they pay the rest of the fighters in their stable ~$50M, you're looking at a very conservative revenue of $100M vs. expenses of around ~160m? On top you have opex of say another 10-20m max, it shouldn't even be nearly as much since they do partner with promotional firms.

If you play with revenue numbers you'll see what they're banking on. In any case, it's way too early to talk about if they will be sustainable. They were prepared for the up front losses, otherwise they wouldn't get the idea off the ground. PBC was bleeding large amounts of cash for 2 or 3 years. Expect the same from DAZN.

Some of the logic I agree with

But your numbers seem pretty questionable

What about the money that DAZN has to spend on other sports? What about their operating income?

The subscriptions they have would have to cover more than just boxing, presumably.

I think their aim is not to make profit in the first stages, but to develop the brand, image and to learn the market. Canelo and Joshua are clearly prestige investments. They must have something else up their sleeve as the plans progress

[j0zef]

Some of the logic I agree with

But your numbers seem pretty questionable

What about the money that DAZN has to spend on other sports? What about their operating income?

The subscriptions they have would have to cover more than just boxing, presumably.

I think their aim is not to make profit in the first stages, but to develop the brand, image and to learn the market. Canelo and Joshua are clearly prestige investments. They must have something else up their sleeve as the plans progress

The $50M I included in other purses covers the rest. At worst, the other 10-20m opex would include those events. They don't have any big events with UFC.. it's mostly Bellator which is extremely cheap, and DAZN is not the promoter, they share a lot of the costs. Besides those 2, they have Soccer and some Baseball.. and again, nothing big. And Op income by definition is the revenue vs. costs, so figure ~conservative 100m revenue from streaming less 150m boxing -20m other = (70m) loss/yr.

They have other sources of revenue as well - ads, affiliate marketing, or as a distribution channel.. but I don't have nearly enough info to even guesstimate what that $ would be, thus I ignored it.

[OnePunch]

here's all you need to know........

Haymon spends several hundred million ($400-$900 million depending on who you ask) of investors money developing his concept = brilliant, playin chess doe


DAZN spends maybe $100-$150 million developing their concept = unsustainable disaster

[OnePunch]

Pot is the same as it's always been. Domestic broadcast, live gate, foreign rights, sponsorships, delayed broadcast, merchandise, etc.

If it's a 50/50 split, instead of splitting the US PPV profits like before, you split the license fee DAZN pays for the domestic rights.

except you fail to mention that two things (broadcast and gate) represent probably 97% of the "pot".

The rest is crumbs.....

[N/A]

except you fail to mention that two things (broadcast and gate) represent probably 97% of the "pot".

The rest is crumbs.....

sure, but he asked how there could be a pot if the fight is dazn and not ppv. the answer is very simple. whatever dazn pays for the fight goes into the pot as part of the broadcast rights.

[OnePunch]

sure, but he asked how there could be a pot if the fight is dazn and not ppv. the answer is very simple. whatever dazn pays for the fight goes into the pot as part of the broadcast rights.

I do wonder how DAZN handles library or rebroadcast rights. Ive never seen one of their contracts so I have no idea. Back when I was doing shows, each network was different. ESPN if I remember correctly only had 30 or 60 day rebroadcast rights built into their contracts, but HBO had rights in perpetuity. The only time HBO ever paid more was for rebroadcast rights on PPV events. But for BAD or WCB events they owned the rights forever.....