First of all, where did you get the 15-20mil sponsorship from? That's extremely inflated! Secondly, don't cable companies take half. So of the 71.5mil ppv revenue, there is 35mil left to be shared between GBP/Floyd/managers/opponent/undercard. Floyd did not make 40mil for that fight. BS from him as usual.
Pac can draw a million when he's in there against a credible challenger, he's a huge drawcard... but. Pacquaio wants co-promotion rights, with 50/50 revenue split. So, the fight generates 2 million buys and returns $120 million in PPV, let's say around 40 million in sponsorship and live gate, you've got a grand total of $160 million. Take off your promotion budget, your undercard, hiring fees, sanctioning bodies, so on and so forth, you're looking at approximately 120 million. Out of that, two lots of promotion fees, so 20% each plus the 20% HBO will take from the pool - so out of the 120 million, you're looking at total take of $72 million for the fighters. 50/50 - $36 million a piece. That's the difference when Floyd is paying a guy to fight him and Floyd is co-promoting with another guy.
It's not extremely inflated, if you have worked in any business environment you'll understand what the sponsorship costs. For Tecate to have major sponsorship rights as they generally always do? You're looking at a massive investment from them and it would be in the $10s of millions. Not to mention other sponsorship and product promotion that takes place during the fight. Cable companies do not take half the proceeds in a PPV event such as this, the problem is when two promotional agencies come together, you have half the money going away between promotional agencies and the PPV host. If the PPV host was trying to get 50% out of the pot before Floyd even got to take his share, don't you think he'd be shopping around at Showtime and saying "Hello... how much you give me?" It's simple mathematics - the difference is I know the mathematics because I've worked as a solicitor in contract law for the last eight years and have done many event promotion contracts, mostly in music.
Except that it is already known that HBO takes half the PPV revenue. It does not take anything away from the other revenues like live gate. So basically, the 77 million would be down to 38.7 miilion + 10 miilion live gate + (I doubt tecate would pay that much) advertisement which would be a generous 2 miilion - you end up with more or less 50 miilion dollars. Pay the undercards, the promotional fees, Berto, Golden Boy, and he could probably get maximum generous number of 40 miilion (but that is stratching it0. But that is not the bottomline. The higher income bracket gets to pay higher income txes too. So, at most, mid 20 millions to low 30 million clean. Not bad for fighting a tree.
Floyd gets a lot of money because he foots the bill, when you invest and put your own money into the project, you get a killer return.
To explain the business model, Schaeffer starts with a pie. A little more than half goes to the distributors (Time Warner, DirecTV, etc.). The balance goes to the network, HBO or Showtime, which takes its distribution fees and hands the rest to the promoters. In this case, Golden Boy has one contract with HBO and another with Mayweather Promotions. But the money, less what distributors and networks take, is under Mayweathers control; normally the promoter would control it. In addition, there is the PPV revenue which Schaeffer includes other revenue streams from that: Those streams include foreign sales for a fight broadcast in 168 territories; closed-circuit revenues (in 2,000 or so bars and restaurants nationwide, in theaters and in rooms at Las Vegas casinos); site revenue (ticket sales, merchandise); and sponsorships.
I doubt Tecate would invests that much amount in a single fight. Coca-cola invest close to 30 million during the NFL suoerbowl. But that is the superbowl, where viewership is hundred times the 1.3 million PPV. And that is Coca-cola. The superbowl advert fee is probably hgalf a miilion for 1 minute slot. It is not realistic that a vastly smaller company, and very much regional product would spend that much.
If he fought 3 times a year it wouldnt be so special. But fighting every 1.5 years, it becomes a huge event, supply vs demand, there is more demand for floyd to actually fight than there is a supply of his fights, so he comes out on top. I think he does it on purpose
I still disagree with the notion that 50% is going to the PPV hosts, their costs to stream a fight aren't exponential, they're servicing it over the same cable network they're already being paid to deliver. In the case of Mayweather Jr who generates these types of volumes in his fights, he would hold too much sway over HBO and Showtime if they were trying to take 50% from the PPV pot. 50% from a PPV pot where they're only seeing 300k buys? Sure, I'll buy that, they have to cover their costs. 50% from a PPV pot where they're seeing 1.3 million buys? Not going to happen, no business would sustain itself in that environment. Remember also that I'm only including the American/Mexican results in my mathematics, I'm not looking at overseas results and overseas PPVs. You'll find that most of the syndication money will go to the original host network (i.e broadcasters showing the fight delayed or highlights of the fight) but ultimately the PPV money? It's going to be like WWF where they collect 75% of the PPV money generated because they've got a proven business model and represent no risk for the network. Floyd represents no risk for the network.
Try reading so that you know what you are talking about, it is obvious you don't know half the **** you talk about in the Lounge or in general. [url]http://www.nytimes.com/2011/09/17/sports/floyd-mayweather-jr-welterweight-with-heavyweight-financial-clout.html?pagewanted=1&_r=2&hp[/url] Mayweather, regarded as one of the best boxers in history, fights under a highly unusual financial structure, exchanging upfront risk for back-end profit while retaining total control. He is even responsible for paying his opponent, in this case a business expense of at least $2 million. Its never been done, Mayweather, who is 41-0, said about his financial model. Not in entertainment history. Not in sports history. You see that arena Saturday? Its all Mayweather money. Want a hot dog? Mayweather money. Want a T-shirt? Mayweather money. I need all that. He can pull this off because of the leverage he forged with his success in the ring. Few, if any, other boxers command such widespread attention and generate so much revenue with a single fight.
Id like to see the break down of MMA fights, they got some that do good numbers and the fighters get **** all compared to boxing. Is a lot of it going to UFC itself?
He's Floyd "Money" Mayweather.:smoke The guy is proven and he was smart enough to work out a sweet heart deal where he can take home the majority of that $40 million after he pays his small percentage to his promoter, manager, sparring partners and lawerys. Plus.....people buy Floyd's fights in droves...that adds up to a lot of perks that fattens his pockets.