By Joe Flint
A month before boxers Floyd Mayweather and Manny Pacquiao even
enter the ring, their May 2 title fight is already breaking
records, with the pay-per-view bout set to cost fans $99 according
to people close to the negotiations between the networks and TV
distributors.
HBO and Showtime, which are handling negotiations for the camps
of Mr. Pacquiao and Mr. Mayweather respectively, are expected to
wrap up deals with major pay-TV distributors in the next few days
for the highly anticipated welterweight title fight. The
negotiations stalled last week as distributors and HBO and Showtime
sparred over the split of what is expected to be record-setting
pay-per-view revenue.
Under the terms being discussed, the fight will be sold for $99
for a high-definition feed and $89 for standard definition, both of
which are record prices.
Initially, pay TV distributors were asked to give up as much as
70% of the revenue instead of the usual 50% to 55%. That offer was
quickly rejected.
The tentative agreement now being hammered out will be less
favorable to the distributors than the standard deal but not as
drastic as the first offer, people with knowledge of the terms
said. The final split will also be determined by the amount of
marketing and promotions the various cable operators put into the
fight. If certain incentives are met, the distributors have the
potential to get 40% of the pay-per-view revenue.
The key deals for HBO and Showtime are with iN Demand, which
negotiates on behalf of Comcast Corp., Time Warner Cable Inc. and
other large cable companies, and with DirecTV, the nation's largest
satellite TV operator with more than 20 million subscribers.
The other distributors that HBO and Showtime will try to reach
accords with are Dish Network and Vubiquity, which handles
negotiations for AT&T Inc. and other distributors.
Boxing enthusiasts have been waiting years for this fight and
the popularity of Mr. Mayweather and Mr. Pacquiao is such that the
bout is expected to be of interest to more than just the hard-core
fan. Some industry observers have predicted that it could top three
million pay-per-view purchases, which could amount to upward of
$300 million. The current record is $152 million for Mr.
Mayweather's fight with Saul "Canelo" Alvarez.
But with the fight only a month away, it is crucial to wrap up
the pay-per-view deals quickly so distributors can start hawking
the match to consumers.
Write to Joe Flint at joe.flint@wsj.com
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