From the outside, boxing looks like a sport driven by money.
The staggering sums earned by boxers, promoters and TV channels from major fights point to a sport that is heavily driven by profit. The much publicised persona of its biggest star (not to mention the richest athlete in the world), Floyd ‘Money’ Mayweather, only underlines the sport’s obsession with money further.
But the seemingly endless negotiations between Mr. Mayweather and his biggest rival, Manny Pacquiao, point to some hidden depths in what drives the biggest match ups. Endless disagreements over drug testing, contract small print and personal grudges have got in the way of what would undoubtedly be the biggest payday in either athlete’s career.
That said, there are many who still believe that the fight is set to go ahead: that the financial incentives on offer for all involved are far too great to ignore. So who would be set to benefit from this fight for the ages?
For such a successful enterprise, it is perhaps surprising that boxing hasn’t had more impact on the financial markets. One possible reason for this oversight might be in the relatively small spread of wealth involved in the sport: a few promoters, channels and fighters share the vast portion of its wealth.
Mr. Mayweather, for instance, has expressed little wish to add to his burgeoning bank account by accepting sponsorship. That restricts the possible companies that will see some exposure from the fight to those supporting Mr. Pacquiao, which include Nike, McDonald’s and San Miguel beer.
The chance for a company to sponsor either fighter, or the fight as a whole, may well end up promising too much for anyone involved to turn down. Some estimates have put the amount Mr. Mayweather alone could earn from endorsements as high as $54 million per year, even if a Mayweather vs. Pacquiao fight does not occur.
One major factor that has often been mooted as a potential speedbump to the fighters’ negotiations is the TV rights deals that both are signed to. In 2013, Mayweather left his – and Pacquiao’s – longstanding network home, HBO, for a lucrative deal with Showtime.
The negotiations between both networks, owned by Time Warner and CBS respectively, may well be tough but most do not believe that they are a blocker to the fight happening. With the amount of money being discussed from pay-per-view in the US alone, both networks will probably find a compromise that works.
For Time Warner and CBS, then, successful negotiations could lead to a big pay day. Elsewhere, TV deals are not yet set in stone – but a British network that picks up the rights could stand to make a handsome sum.
Manny Pacquiao’s last fight was also against an American, Chris Algieri. With the Philippine fighter viewed extremely highly in his home country – where he plays an active role in politics and gives much back to the community – his success may well have an effect on the local economy.
That fight against Chris Algieri, for instance, was followed by a rare run of success for the Philippine peso against the dollar. The peso gained around 1% in the weeks after Mr. Pacquiao’s success, counteracting a long strong run for the dollar for those involved in trading market forex.
All of the Philippines would undoubtedly be feverish in its support for Mr. Pacquiao if a fight is indeed confirmed. Many may not realise that a lot more rests on who wins than just bragging rights and titles.
With some estimates of the possible pay out from a fight between boxing’s biggest draws rising as high as $1 billion – the equivalent of some 65 Premiership football matches – it seems inconceivable that the match wouldn’t happen. As ever in boxing, though, predicting an outcome can be a fool’s game.