Showtime bet on boxing pays off
In two years at the helm of Showtime Sports, Stephen Espinoza has the network's boxing franchise at an all-time high and poised for another big year in 2014.
Showtime got involved in boxing in 1986. While it has been home to a number of major fights, producing several significant pay-per-views featuring Mike Tyson and Julio Cesar Chavez Sr. in the 1990s, the network has always been a second-class citizen to premium cable leader and rival HBO.
But times, well, they are a-changin'.
No doubt, Floyd definitely wants the fight. Where the conflicts and obstacles are is the promotional interests. Floyd has been pretty clear he would do it if Top Rank wasn't involved. If we can get past the promotional conflicts, no doubt, Floyd does want the fight.” -- Stephen Espinoza, on a possible Mayweather-Pacquiao fight
Although HBO remains the clear leader in overall boxing viewership -- which it should, given that it has 29.2 million subscribers to Showtime's 22.8 million (a gap that has closed substantially in recent years) -- Showtime has had a vastly improved slate of fights on Espinoza's watch, leading to critical acclaim and the network's strongest boxing viewership ever.
Espinoza replaced Ken Hershman at Showtime after Hershman, ironically, left the network to head up HBO Sports. Espinoza has made Golden Boy Promotions, which has boxing's deepest stable of fighters, the de facto exclusive promoter of the network's flagship "Showtime Championship Boxing" program. With HBO announcing in mid-2013 that it would no longer put on Golden Boy fights, Espinoza had an even bigger pool of its fighters to pick from to populate his telecasts.
The strategy clearly worked. Showtime delivered numerous deep cards, had many of the most-viewed fights in its history, and featured many of the sport's most recognizable names.
While HBO's 2013 viewership was essentially stagnant, Showtime's average viewership for "Showtime Championship Boxing" was up 21 percent from 2012, Espinoza's first year, and a whopping 59 percent from 2011, Hershman's final year.
In 2013, Showtime had three of its five largest average audiences for boxing and four of its six most-watched individual bouts.
In addition, Showtime's dormant pay-per-view business jumped to No. 1 on the strength of the network's deal with pound-for-pound and pay-per-view king Floyd Mayweather Jr. Showtime and parent network CBS lured Mayweather away from HBO with a 30-month contract worth about $200 million for up to six fights.
Mayweather fought twice in 2013, generating more than 3 million pay-per-view buys. His May fight with Robert Guerrero sold, depending on who you believe, either a little more or a little less than 1 million units. Mayweather's September fight against Canelo Alvarez was a blockbuster. It set the all-time pay-per-view revenue record ($150 million) and sold 2.2 million subscriptions, second-most in history. With Mayweather slated to fight two times in 2014, another avalanche of revenue is expected.
For Espinoza, 2013 couldn't have gone any better.
"It starts with doing quality fights, competitive fights top to bottom on our cards," he told ESPN.com in a recent interview. "We're doing high-quality events and the fighters delivered great entertainment. We saw stars, we developed prospects. We did a very good job helping our established guys progress to the next level, guys like Danny Garcia and Keith Thurman, and we saw guys like Shawn Porter take a huge leap. We are putting them in tough, challenging fights and they're advancing to the next level.
"We're very happy with the success of the Mayweather-Canelo pay-per-view. We saw fighters like Bernard Hopkins and Adrien Broner do big ratings for us. Candidly, I couldn't have asked for a better year. Year 1 was a transition year in terms of adjusting our on-air talent, the way we produce our events; we cleaned up some leftover obligations we had and we positioned a lot of guys to be successful going forward. And then we hit our stride in 2013 and we had great event after great event."
Espinoza addressed a number of other topics. Here's what he had to say:
The Mayweather deal
It shook up the industry and turned Showtime from a pay-per-view afterthought to the leader. With two more Mayweather events on tap for 2014 and perhaps three Alvarez fights, Espinoza hopes to keep the ball rolling.
"Signing Floyd was without question the highest impact move we made," he said. "In terms of the impact to the industry, it announced this was going to be the start of a new era at Showtime, and the first year of our relationship couldn't have gone better. There was a learning curve on the first event [against Guerrero] because we were working with Floyd and his team for the first time and getting the kinks out."
Espinoza said the event generated more than 1 million buys, even though others in the industry insist it did closer to 850,000. It's been a source of frustration for Espinoza, who did not want to rehash the controversy.
"I've stopped talking about it. It's not worth kicking up the dust again," he said. "We thought we'd be in the neighborhood of a million and that's where we are. It's an old issue."
The September fight, however, was a monster event.
"It exceeded our expectations in terms of financially and visibility," he said. "I actually think that the first year [of the Mayweather deal] went much more smoothly than I would have thought it would have. I would have expected some more growing pains. All in all, it went well for both sides."
Mayweather will fight May 3 and plans to fight again in September. His opponents are not set, although Amir Khan, despite being viewed by many as undeserving of the fight, is the probable May foe. Espinoza, however, said nothing with Khan is done.
"There are certain realities on what opponents are available and what conflicts are in place," Espinoza said, referring to the cold war between Mayweather/Golden Boy and Top Rank, which promotes fighters such as Manny Pacquiao and Timothy Bradley Jr., who would make for attractive opponents.
"Of the opponents available, Floyd's goal and our goal is to make the biggest event possible," Espinoza said. "Which is going to be the most challenging, competitive opponent and most entertaining bout? There are business considerations but those are secondary. Who will be most entertaining once the bell rings? That's the way we will evaluate the May fight and every fight after that. I like the Khan fight stylistically. I think Amir provides a set of challenges based on his skills that Floyd hasn't seen in a while. For that reason, I think it will be a very entertaining fight. But there is a general misconception of where we are in the process.
"A lot of people believe a decision has been made and an announcement is being put off. No decision has been made about the opponent. Marcos Maidana just had an incredibly impressive performance [on Dec. 14, winning a welterweight title from Broner]. That will impact our discussions. The opponent is far from set.
"I think of the guys available as opponents, I'm torn between Amir Khan and Marcos Maidana. I think they bring very different sets of challenges to the fight. I can tell you this: Maidana's performance against Broner has gotten Floyd's attention. It's a name that has been discussed, but the decision will be made collaboratively."
What about Mayweather-Pacquiao?
That's the fight the boxing world has wanted to see for years, and it's back on the minds of many after Pacquiao rebounded from his knockout loss to Juan Manuel Marquez and looked good easily outpointing Brandon Rios on Nov. 23. Still, the sides have been unable to make a deal since the first failed negotiation in late 2009. Mayweather refuses to do business with Pacquiao promoter Top Rank, and their concepts on how to split the money are as different as night and day.
Espinoza knows it's unlikely, at least in 2014, but said he'll do what he can to facilitate it.
"It's still an interesting fight. It's still a fight worth pursuing," Espinoza said. "I wouldn't be doing my job if I didn't make the necessary inquiries and make a real, legitimate effort to getting that fight done. Having said all that, there's a lot of history there, a lot of conflict to overcome. Right now, as things stand, I'm not optimistic. I'm not sure the gap can be bridged. But as long as it's an interesting, viable fight, even if I am banging my head against the wall, I can try."
Contrary to what many believe, the networks are not an obstacle. While Mayweather is signed to Showtime and Pacquiao fights on HBO, Pacquiao has no network contract and could fight on Showtime.
"No doubt, Floyd definitely wants the fight," Espinoza said. "Where the conflicts and obstacles are is the promotional interests. Floyd has been pretty clear he would do it if Top Rank wasn't involved. If we can get past the promotional conflicts, no doubt, Floyd does want the fight."
Rivalry with HBO
"We have pulled even with HBO in terms of the level of fights, even if not viewers," Espinoza said. "We are the No. 1 destination for boxing fans, and that's based on the established assets we have, the rising prospects we're grooming and maybe, most importantly, the quality of the fights we are doing. I know there are viewership differences, and theirs is bigger and it should be. They have 25 percent more subscribers so they should have more viewers on an average basis. But average audience shouldn't be confused with the quality of fights we've been doing. Our fights have been without equal."
Viewers got a bit spoiled in 2013 with Showtime regularly putting on tripleheaders and even some quadrupleheaders. Espinoza said there will be more three-fight cards this year, but probably only an occasional four-fight show.
"The quadrupleheaders will be the exceptions," he said. "It's a really long night, even for boxing fans. The sweet spot is tripleheaders. I think that's the right combination of television programming and content for fight fans to make it a satisfying experience. That said, the reason we do the quadrupleheaders and show [undercard bouts] on Showtime Extreme is there is an abundance of TV-worthy fights. It's a nice problem to have."
Based on the number of fights and the quality of bouts Showtime televised in 2013, many in the industry believe the network is outspending HBO, something once thought to be impossible.
Espinoza declined to disclose his budget, but said, "It looks to me like we're on par with HBO in terms of the resources we're committing to boxing. On our end, that's the result of reprioritizing our resources."
Indeed, Espinoza axed Showtime's MMA programming and "Inside NASCAR," although he did launch the critically acclaimed "60 Minutes Sports" magazine series.
"Certainly, some of that shifting money was committed to boxing," he said. "It's how we spend the boxing money we have. One of the reasons we did triple- and quadrupleheaders is an efficiency. Doing one quadrupleheader is cheaper than two doubleheaders on two nights because you save the extra productions costs."
Only Golden Boy fights
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Since Espinoza has been in charge, Showtime's fights have all been put on by Golden Boy, other than a few obligations to other promoters at the start of his tenure. Some have criticized the closed shop, but Espinoza has made it work, getting Golden Boy CEO Richard Schaefer to consistently sell him quality fights. They have a close relationship, which helps. Before Espinoza arrived at Showtime, he was Golden Boy's attorney.
"I don't see any virtue of going with a variety of promoters just for variety's sake," Espinoza said. "Who's offering the best, most entertaining fights consistently? It's Golden Boy, because they have a deep talent pool. There are deals I did pursue with other promoters that I didn't get. I bid competitively to get Ruslan Provodnikov because he fits in the 140 and 147 division, where we have deep talent. I went aggressively for the Sergio Martinez-Julio Chavez Jr. fight in 2012 but they went with HBO. Richard and I have disagreements occasionally, but the reality is Richard is one of the smartest people I know and a very practical businessman, so those disagreements don't last very long. The benefit of having the great relationship that we do is that we can get past those disagreements quickly and without hard feelings."
Espinoza said he and Schaefer, as well as adviser Al Haymon, who works with most of Golden Boy's top fighters, rarely disagree on matchups.
"I'm never really in the position to twist their arms to get their guys to take tough fights," he said. "We got a lot of dream matchups [in 2013], like Mayweather-Canelo and Garcia-[Lucas] Matthysse."
More fights on CBS?
In December 2012, Espinoza was a central figure in getting CBS, Showtime's parent network, to air live boxing (a Leo Santa Cruz title fight). It was the first live fight on CBS since the late 1990s. Although there were hopes for more in 2013, it didn't happen.
Espinoza said there could be another try in 2014.
"I think it's a possibility," he said. "I do plan to have some conversations about it. CBS has a very full lineup of sports already so it's challenging to find available slots on weekends. I'd like to find some opportunities where it makes sense."
He also said he thinks live fights could be headed to CBS Sports Network, which has shown fight replays and the "All-Access" reality series leading up to pay-per-views.
• Espinoza said he hopes to finalize a deal with Schaefer that will see Bernard Hopkins, who turns 49 on Jan. 15, face Beibut Shumenov in a light heavyweight title unification fight this spring.
"That is an interesting fight to me. Shumenov looked pretty strong [on Dec. 14]. Bernard is as entertaining now as he's ever been and he's still at the top," Espinoza said.
• Espinoza identified three fighters he can see becoming pay-per-view fighters: junior welterweight champ Garcia, interim welterweight titlist Thurman and deposed welterweight titleholder Broner.
"Garcia has made quantum leaps in terms of popularity," he said. "I think Keith is so entertaining in the ring and so likable outside the ring that there's no ceiling on his potential. With Broner, the loss, to me, doesn't affect his viability whatsoever. Down the road, I can see a Canelo-Broner fight as a major pay-per-view. It's not crazy. I think we have to wait until Adrien grows into the bigger weight, but that's a blockbuster."
All in all, Espinoza said he believes that the future of boxing is bright and that boxing will continue to be a major part of Showtime's programming.
"We're driven in large part by competition, but we're really competing to do the highest quality and highest impact events we can," he said. "Showtime has a long history in boxing, and we think this past year stacks up as possibly the best in that history. That's something we're all proud of."
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