PPV pricing model - lots of money left on the table

[stuff jones]

Boxing's pay per view pricing model always struck me as absurdly expensive. This article, claiming that in the US the ratio of illegal streams to ppv purchase for May Mac was 9:1 convinced me.

https://www.forbes.com/sites/nelson...s-dwarfed-pay-per-view-estimate/#214a47f973d2

42 Million people in the US streamed the fight illegally. There's a lot of money being left on the table by pricing people out with such absurd prices. Now the numbers aren't going to be the same for all fights, but the general idea applies: a ton money is being left on the table because people are given the option of crazy price or free.

Instead of say, 100 bucks (or 80 or whatever) or 0 bucks for an illegal stream, why aren't there tiered pricing options available for fights? Like:

HD = 80
MD = 40
LD = 10

I don't generally buy fights because 80 bucks for half an hour of entertainment is hooker pricing, but I'd buy a lot more if I could pay ten bucks and now have to worry about an illegal stream dying or getting glitchy mid fight.

 

[Deleted member 363827]

There is already a non-HD option for most PPVs, but they are only like 10 dollars cheaper.

 

[Sunfish]

Boxing's pay per view pricing model always struck me as absurdly expensive. This article, claiming that in the US the ratio of illegal streams to ppv purchase for May Mac was 9:1 convinced me.

https://www.forbes.com/sites/nelson...s-dwarfed-pay-per-view-estimate/#214a47f973d2

42 Million people in the US streamed the fight illegally. There's a lot of money being left on the table by pricing people out with such absurd prices. Now the numbers aren't going to be the same for all fights, but the general idea applies: a ton money is being left on the table because people are given the option of crazy price or free.

Instead of say, 100 bucks (or 80 or whatever) or 0 bucks for an illegal stream, why aren't there tiered pricing options available for fights? Like:

HD = 80
MD = 40
LD = 10

I don't generally buy fights because 80 bucks for half an hour of entertainment is hooker pricing, but I'd buy a lot more if I could pay ten bucks and now have to worry about an illegal stream dying or getting glitchy mid fight.

$80 for half an hour? Cheapskate

 

[stuff jones]

$80 for half an hour? Cheapskate

I just pay them to massage my bunions.

 

[Shoemaker]

Boxing's pay per view pricing model always struck me as absurdly expensive. This article, claiming that in the US the ratio of illegal streams to ppv purchase for May Mac was 9:1 convinced me.

https://www.forbes.com/sites/nelson...s-dwarfed-pay-per-view-estimate/#214a47f973d2

42 Million people in the US streamed the fight illegally. There's a lot of money being left on the table by pricing people out with such absurd prices. Now the numbers aren't going to be the same for all fights, but the general idea applies: a ton money is being left on the table because people are given the option of crazy price or free.

Instead of say, 100 bucks (or 80 or whatever) or 0 bucks for an illegal stream, why aren't there tiered pricing options available for fights? Like:

HD = 80
MD = 40
LD = 10

I don't generally buy fights because 80 bucks for half an hour of entertainment is hooker pricing, but I'd buy a lot more if I could pay ten bucks and now have to worry about an illegal stream dying or getting glitchy mid fight.

This is just conjecture but it could be because if you add a "low definition" option, you'll wind up getting more pull-down from SD than you'd gain from people who pirate switching over. The low definition stream would have to be somewhere between pirated-quality (which can be pretty damn good sometimes) and standard definition.

I guess the question is: do people stream it because they can't afford it, or do they do it just because they're cheap and looking to cut whatever corners they can? I know I used to be the former; but I don't underestimate the latter, either. I imagine companies like HBO and Showtime have done some kind of market research on this stuff. Maybe not perfect, but I'm sure they have some data that is supporting the pricing. It would be interesting to see, for sure.

 

[treelo]

Go tell top tier fighters that the pricing structure is abvsurd, and then also go and ask yourself why MMA fighters are trying to cash in boxing rather than the other way round

 

[Boxiana]

Laffer curve in effect

 

[stuff jones]

Go tell top tier fighters that the pricing structure is abvsurd, and then also go and ask yourself why MMA fighters are trying to cash in boxing rather than the other way round

What? Those two points are non sequitor. The point is that more money could possibly be made, that would benefit boxers. And what does MMA have to do with this?

 

[Sunfish]

What? Those two points are non sequitor. The point is that more money could possibly be made, that would benefit boxers. And what does MMA have to do with this?

Apart from pro wrestling and boxing there is no combat sport or "sports entertainment" option available. Except maybe sumo.

Mayweather got to the point that people didn't give a fuck what the price, they wanted to see him lose.

Nobody else is close to that level at the minute.

Except The Rock.

 

[Sakuraba7]

$40-50 is what they USED to be. Blame Floyd for doubling the price.

PPV in general is archaic and overpriced, now absurdly so. WWE got out of it a long time ago. Boxing in general tends to have select number of PPVs a year, its mostly still on subscription TV (HBO and SHO).

The UFC is the one keeping it alive, with their monthly $60 PPVs. They have no place in the modern era. They're already making $500 mill a year from FOX. Why double charge people on top of that, and Fight Pass is separate as well. WWE Network is 6 months subscription for the same price.

 

[Sakuraba7]

This is just conjecture but it could be because if you add a "low definition" option, you'll wind up getting more pull-down from SD than you'd gain from people who pirate switching over. The low definition stream would have to be somewhere between pirated-quality (which can be pretty damn good sometimes) and standard definition.

I guess the question is: do people stream it because they can't afford it, or do they do it just because they're cheap and looking to cut whatever corners they can? I know I used to be the former; but I don't underestimate the latter, either. I imagine companies like HBO and Showtime have done some kind of market research on this stuff. Maybe not perfect, but I'm sure they have some data that is supporting the pricing. It would be interesting to see, for sure.

Generally when it comes to absurd pricing and market research. It usually indicates it is more profitable to sell $200 product to 2 people. Then to attempt to sell $20 product to 20 people.

If a company can sell $80 garbage to a small pool of customers, its still more profitable then to slash the price and HOPE the amount of customers double. Often times the amount of people willing to pay is limited, period.

I remember, before WWE got out of the PPV business in 2014. They upped their PPV prices, in the mid-to-late 2000s, from i think $40 to $55/60 or so. Their sales went down, but the revenue went up.

 

[rikwebb]

I remember, before WWE got out of the PPV business in 2014. They upped their PPV prices, in the mid-to-late 2000s, from i think $40 to $55/60 or so. Their sales went down, but the revenue went up.

They are still in the PPV business, they just dont advertise it as much due to the network now. Summerslam this year was between $45-54.99 in the states depending on the provider and about £20 over here.

 

[Sakuraba7]

They are still in the PPV business, they just dont advertise it as much due to the network now. Summerslam this year was between $45-54.99 in the states depending on the provider and about £20 over here.

Its only on cable not satellite now, and that's pretty much aimed at people who can't or haven't subscribed to the WWE Network online service. I imagine the people who buy it are mainly areas with poor bandwidth and streaming.


Edit: According to their Q1 2016 report, they sold only 153k PPV. So that's an avg of 51k PPVs a month.
https://www.pwtorch.com/site/2016/05/10/wwe-q1-2016-ppv-revenue-nearing-extinction/

Q2 was 343k buys, and that was with 4 PPV events including Wrestlemania.
https://www.pwtorch.com/site/2016/0...-reporting-ppv-revenue-plus-three-year-trend/

And I think they stopped reporting after that and since.

 

[The Can Opener]

I don't generally buy fights

That figures.

 

[Shoemaker]

Generally when it comes to absurd pricing and market research. It usually indicates it is more profitable to sell $200 product to 2 people. Then to attempt to sell $20 product to 20 people.

If a company can sell $80 garbage to a small pool of customers, its still more profitable then to slash the price and HOPE the amount of customers double. Often times the amount of people willing to pay is limited, period.

I remember, before WWE got out of the PPV business in 2014. They upped their PPV prices, in the mid-to-late 2000s, from i think $40 to $55/60 or so. Their sales went down, but the revenue went up.

Bolded. That might be true for PPV but I don't think it's in general. Some cases casting a wider net does have benefits (like micro-transactions in free to play games), while also still having offerings for more flush customers. Pay per view video entertainment is kind of a peculiar product, especially when you take future promotion into account.

I'd be interested to hear what someone like @RR has to share on the subject. He'd definitely have more insight than any of us. I'm sure @Sharkey has done some research on this as well.

Interesting about the WWE. Why did they get out of PPV?

 

[Sunfish]

Bolded. That might be true for PPV but I don't think it's in general. Some cases casting a wider net does have benefits (like micro-transactions in free to play games), while also still having offerings for more flush customers. Pay per view video entertainment is kind of a peculiar product, especially when you take future promotion into account.

I'd be interested to hear what someone like @RR has to share on the subject. He'd definitely have more insight than any of us. I'm sure @Sharkey has done some research on this as well.

Interesting about the WWE. Why did they get out of PPV?

I can weigh in with a misinformed opinion?

I've heard of this guy called consortium. I heard he researches his posts well, we could ask him?

 

[Shoemaker]

I can weigh in with a misinformed opinion?

I've heard of this guy called consortium. I heard he researches his posts well, we could ask him?

Okay, sure. Why not?

 

[Shoemaker]

The boxing forum is acting weird today.

 

[Sunfish]

The boxing forum is acting weird today.

Boxing forum or me? I got given some tablets for my back yesterday so I am floating.

Seems like these guys will make bank if they can make the fights together but no one can drop out of the limelight for too long.

Golovkin will have got paid and aside from canelo I think he gets more cash Saunders but @RR would know how the negotiations would iron out.

 

[Shoemaker]

Boxing forum or me? I got given some tablets for my back yesterday so I am floating.

Seems like these guys will make bank if they can make the fights together but no one can drop out of the limelight for too long.

Golovkin will have got paid and aside from canelo I think he gets more cash Saunders but @RR would know how the negotiations would iron out.

Haha no, not just you. Someone else said something to me in another thread that had me scratching my head "but why?" Just one of those days.