£1,500,000 has been offered by Eddie Hearn of Matchroom Sports to Carl Frampton to face Scott Quigg in July. Sounds like a lot of money – it is a lot of money – but let’s look at the economics of what this bout would likely generate in terms of revenue before shouting from the rooftops that anything but a hell yes from Frampton means he doesn’t actually want this fight.
The Manchester Arena has a capacity of around 21,000. Let’s say 19,000 of those are paying customers. But this is boxing & boxing needs a centralized ring which squeezes actual capacity down to more like 12,000 with say 11,000 paying customers. Mean retail ticket prices would be expected to reach a face value of around £125.00. This is before they hit the secondary market. That’s £125.00 * 11,000 = £1,375,000.00 in gate receipts alone.
The crux though will or would rather be the Sky Box Office PPV income which I’d anticipate would be set at or around £17.95 per buy. Bare in mind that traditionally the distributor (in this case Sky & affiliates) get 45% of PPV takings. Its extremely difficult to calibrate what a real PPV buy rate might be but I’ll take an educated guess that Frampton vs. Quigg would return in the region of 475,000 UK PPV buys.
This would mean gross PPV revenue of 475,000 * £17.95 = £8,626,250.00 with 45% or £3,836,812.50 going directly to Sky coffers. This leaves £4,789,437.50 from PPV plus the projected £1,375,000.00 from gate receipts plus say a rather more modest £200,000.00 from foreign television rights (conservatively) & say £100,000.00 in the form of event sponsorship for a total ‘pot’ of £6,464,437.50.
From that total venue hire (£195,000.00); TV production costs (£70,000.00); under-card fighters pay (anything up to £1,000,000.00 if A-tier fighters are used); security (12,000/80*£350 = £53,500.00); Public Liability Insurance (pro rata £25,000.00) & timekeepers, referees, judges; ambulances on call; doctors plus paramedics (£25,000.00) will need to be paid out. This leaves a rolling total of £5,095,937.50.
£1,500,000.00 to Frampton thus represents 29.4% of the projected upside of the promotion. The clincher is Hearn holds the Sky PPV card which is the only way, in the current landscape at least, that such totals are vaguely doable.
Taking this fight to ITV is problematic on several levels:
1) If we accept that whilst Frampton is the favorite the pulling ability of both against each other is the reason this fight appeals to such a large segment of the sport’s viewing public & potential viewing public then we accept that even without promotional politics each has roughly the same negotiating power.
2) Eddie Hearn’s loyalty is to Sky Sports with whom he has successfully partnered on a myriad of successful shows in the past three years. He did not earn & can not hope to maintain loyalty in kind by having the biggest fights in the UK taken to a rival broadcaster.
3) ITV – despite the misinformation being mindlessly distributed through the press – have about as much interest in professional boxing as they do in rare Ming Dynasty pottery. Carl Frampton’s promoter or parties aligned to him rented the spot on ITV4 & ITV for Frampton vs. Avalos. The investment from ITV was zero. This is why Frampton didn’t appear on Jonathan Ross & why the 1,100,000 viewer under performance of the show was entirely academic to the long run aspirations of Britain’s leading independent television network.
4) As a major advocate (generally) for terrestrial investment in the sport as one of mass appeal I am forced to concede that this is near un-achievable on a sporadic, once off fashion, ie. not within the framework of a system moving full pelt back toward free-to air television – advertisers & potential advertisers of any stature require a track record of viewership numbers (& impressive viewership numbers at that) before investing on a whim. There are only so many overly generous steel magnates in the world to fall for the old chestnut of blanket & blind optimism.
5) Even a liberal projection of the gross revenue possible via the ITV route taps out around the £3,000,000.00 level – meaning even if Quigg acquiesced to Frampton’s demands at best the same amount of money is on the table for Frampton & undoubtedly less for Quigg, Matchroom & Barry McGuigan. A more accurate educated guess of total revenue paints a yet more dire picture financially for all involved relative to Sky’s cash in hand alternative.
It is a pity that ITV remains an unfeasible option for this bout – as more people would be able to view the action – but that is the simple economic reality of the state of the sport & how it is currently taken to market in the United Kingdom.
In the fullness of time Carl Frampton – perhaps less of an active economic mind than myself – will come to realize that £1,500,000.00 is an incredible amount of money for a super bantamweight to simply walk away from…