NEW YORK — By any measurement, it’s been a banner year for Showtime Sports. With a newfound commitment to boxing, Showtime has seen its ratings soar. In 2013, the network’s championship boxing telecasts increased by 24 percent from last year and by 64 percent since 2011. The rise has positioned Showtime, perhaps for the first time, as a virtual co-leader, along with HBO, in the boxing broadcast industry.
Last week, Showtime Sports Executive Vice President and General Manager Stephen Espinoza sat down with SI.com to discuss the year that was.
SI.com: Let’s get right to it: How many pay-per-view buys did Floyd Mayweather-Robert Guerrero do?
Stephen Espinoza: You know, I stopped answering that question because no one believes whatever answer I give. I say that half jokingly. I’ve been truthful in my public statements. I know there is a fascination in sports with numbers and salaries. I’m not sure where the fascination with the pay-per-view numbers came from. I think it’s a little misplaced.
SI.com: Did you expect Floyd to fight Canelo Alvarez?
SE: It didn’t surprise me that much. Call me a little na?ve, but when Floyd said at the outset of the deal that he wanted to make his remaining fights big events and as competitive as possible, I believed him. That was one of the fundamental understandings we had in making this deal. I was more concerned it would fall apart over finances or some deal point, not because the fighters didn’t want. It was the right fight at the right time.
SI.com: Taking Floyd away from HBO was a major coup for Showtime. Looking back, how were you able to do it?
SE: It was the result of a couple of things. One, the CBS platform was a big attraction for Floyd. Being able to be exposed not just on the CBS television network, but bringing in CBS Outdoor, CBS Interactive, CNET, TV Guide, TV.com and the whole range of assets, including the CBS Sports radio network, an outlet he didn’t have access to. That was, from a business standpoint, the fundamental attraction.
From a non-business point, I think some irritations had built up [with HBO] over the years. A fresh start with someone that had a different perspective was probably appealing to him. After a year, in hindsight, I couldn’t have asked for it to have gone any better. There were things I’d like to improve on, but overall, I’m thrilled with it
SI.com: What would you improve?
SE: I think we missed the mark on the messaging of Mayweather-Guerrero. We made it a little bit too much about Guerrero the person and not about Mayweather-Guerrero the matchup. That was intentional. It was a choice. We look at the Mayweather events not as boxing matches, but events. To sell it as a boxing match undersells it. Our focused was maybe misplaced, in hindsight.
SI.com: You guaranteed Floyd a lot of money. Is it possible for him to meet your financial expectations?
SE: There is a lot of misinformation out there about the deal and about the way it is structured. That’s the risk of not handing out the details of the deal. It comes with the territory. There are no $12 million losses, no financial disasters on his fights, the first or the second. We’re not going to create a situation in the future where that happens again. Floyd is going to get paid very well, well more than anyone else in the sport. More than anyone in any sport, really. It’s commensurate with his value but it’s not going to be under a deal structure which is a major constraint on Showtime Sports or the company as a whole. We have structured a flexible deal that will be beneficial for both sides.
SI.com: The perception is that Showtime guaranteed Floyd tens of millions, no matter who he fights. How close is that perception to reality?
SE: We have made certain guarantees based on certain levels of fights. That much is true. Where people misunderstand the deal structure is whose cost are whose, who pays for marketing and what additional cost beyond these guarantees Showtime normally has to bear. If you look at a guarantee of X plus a bunch of expenses, that’s how you get to crazy numbers like $12 million, $13 million losses. If you understand the PPV business and say there is a guarantee of X and some additional expenses but not excessive, then you understand it is an aggressive but realistic business model.
SI.com: Are you outspending HBO?
SE: I think the perception [that Showtime is spending more on boxing than HBO] is accurate. If you look at the number of events, the number of fights, the stature of the events that each network has done, I have to conclude that the budgets are very similar, or that ours is even larger.
SI.com: Why was investing so much in boxing the best course for Showtime Sports?
SE: This year, from an overall sports perspective, our strategy was to re-prioritize our resources and personnel into high quality, high impact programming. We made the decision not to renew Inside NASCAR and not to move forward with Strikeforce MMA. Those were simply because we just weren’t getting the return on the investment that we thought. That freed up money to do some other things, like launch 60 Minutes Sports, do a couple of documentaries and, in a sense, double down on boxing. I’ve never been one to subscribe to the ‘boxing is dying’ fallacy. I think boxing is stronger now than it has been in maybe the last 20 years. You have more networks televising more hours, both in English and Spanish, than we have seen in recent past. We have a depth of talent that exceeds what we have had in the last 20 years, particularly in the mid-range weights. Demographically, boxing still draws an attractive audience. It’s one of the few sports that as a premium network we can participate as a leader in the sport.
SI.com: Other promoters use the phrase “closed shop” when it comes to Showtime, obviously referring to your close relationship with Golden Boy Promotions. Your reaction?
SE: I understand the perception. What the public isn’t privy to are the things we pursued and didn’t get. The Sergio Martinez fights we bid on and didn’t get. The Gennady Golovkin bids we put in. The Mikey Garcia fight that we tried to get. Ultimately we didn’t get them, and that’s part of the business. The result may appear that we are not pursuing other things, but there are definitely other promoters that we are engaged with. By the same token, the majority of talent is concentrated in two promoters. One promoter [Top Rank] is pretty much exclusive to HBO. The other promoter, Golden Boy, for my money has the deepest talent base anyway. Of the talent available to me, most people would look at it and say the most attractive talent is with Golden Boy. So it’s a combination of the way the market is set up and the way that some of the chips have fallen.
SI.com: Hold on….you bid on Martinez and Golovkin fights?
SE: Yes. And immediately after losing out on them, those fighters were signed by HBO to multi-fight deals. I looked at it as a compliment.
SI.com: Boxing has had a good year, I get that. But can boxing really grow more into the mainstream when the sport is basically divided into leagues, when we can’t see obvious good fights, like say Danny Garcia-Ruslan Provodnikov?
SE: Candidly, no. That is a major hindrance. I don’t want to sound like I’m pointing the finger at everyone else, but I have no problem with Provodnikov or any other 140-pounder calling me up and trying to arrange a fight with Danny Garcia. If the fight makes sense, and it’s an attractive one, I’m happy to put it on the network. It doesn’t matter if it’s promoted by Top Rank or Artie Pelullo or anybody else. Unfortunately that can’t be said for the other network. I’d love to do Provodnikov-Garcia.
