The Winner Is . . . Pay-Per-View TV : Marketing Hitting New Peaks in the Tyson-Ruddock Match

If Donovan (Razor) Ruddock should nestle into the canvas Friday night with the encouragement of a short, crisp jab from Mike Tyson, the overhead camera will show him sprawled on a huge Budweiser logo on the ring mat.

It may be a priceless shot from an aesthetic standpoint but, like everything else involved in a big-time boxing match, it definitely has a price: It’s costing Anheuser-Busch about $750,000 to put its premium trademark there.

If it can be sold at this fight, it’s being sold--right down to the National Anthem, which will be sung by Peabo Bryson in a performance that his employer, Columbia Records, is promoting aggressively.

Joked Scott Kurnit, president of Showtime Entertainment Television, a partner in the pay-per-view TV promotion: “We’ve got to figure out a way to get the fighters to wear more than boxing trunks so you can fit more logos on.”

The logos and advertising tie-ins have long been standard on a top-flight boxing show. But what makes Friday’s contest stand out is that it represents the latest stage in the evolution of pay-per-view TV. Virtually every element of the promotion is aimed at boosting the pay-per-view audience.

Nobody contends that Tyson versus Ruddock represents the pinnacle of fistic art. It just happens to be the top attraction available at a time when pay-per-view TV is finally blossoming.

Pay-per-view sales will account for at least two-thirds--and possibly as much as three-quarters--of the event’s gross revenue. Promoter Don King predicted that the pay-per-view draw will be 1.9 million households. At the $34.95 suggested price, that would be $66 million. All other revenue sources, including the live gate, total about $20 million. Even if King were off by 400,000 households, Friday’s contest would still be the richest pay-per-view event ever.

(The April bout between heavyweight champion Evander Holyfield and George Foreman holds the record, which its promoters, Time-Warner’s TVKO pay-per-view network, put at 1.49 million households and $55 million gross. Kurnit, a rival, claims that TVKO’s numbers are inflated and the real draw was 1.3 million homes and $48 million gross.)

Steve Wynn, the Vegas impresario who built the Mirage, the huge hotel-casino where Friday’s fight is being staged, says telecommunications technology has ushered in “the Age of the Promoter.” With pay-per-view TV now able to reach 19 million households via cable, the broadcast networks no longer run all the big shows. Anybody with an event and the relative pittance it costs to rent satellite transmission hardware can sell it to the world.

Still, even in the Age of the Promoter, it seems odd that the most highly evolved member of the species would be the hyperbolic, electric-haired Don King.

“Is Tyson’s insatiable lust for women taking his mind off Razor Ruddock?” King screamed into a TV camera Monday, playing off a USA Today report that referred colorfully to Tyson’s “raging libido.”

“Is the fury gone?” King screamed, parroting the headline on the cover of last week’s Sports Illustrated. “All questions will be answered Friday!” King screamed. “King Vision Pay Per View! Ask your local cable operator!”

For several hours a day all this week, for talk shows, sports and news programs nationwide, King has been screaming the same message--give or take a few denunciations of the envy-haunted rivals who are always plotting to do him dirt.

Yes, King is a throwback to the carnival barker, but he has Mike Tyson, today’s most bankable fighter, and he has refined a new kind of barter system to help drive his pay-per-view events.

If you want a piece of this fight, don’t pay King in coin, pay him in air time. Of the approximately $10 million worth of promotion that King is sinking into Friday’s event, less than $3 million comes out of his pocket, he said. The rest is barter.

Thus, the $750,000 that Anheuser-Busch pays to put the red-and-white Budweiser “bow tie” on the ring mat and numerous other camera-strategic positions around the arena is not in cash--it’s in TV commercials that promote the fight. As the nation’s biggest sports advertiser, Anheuser-Busch is in a fine position to work that way. It simply substitutes Tyson-Ruddock ads for some of the dozens of beer ads it airs every day.

(Such barter dealing becomes even more crucial in the fall and early winter, when the weekend TV schedule is crowded with football and basketball and the choicest ad time has already been snapped up by sports-hungry advertisers. The King of Beers always has plenty of spots that can be traded.)

Similarly, when ABC bought the rights to broadcast the fight on a delayed basis, it paid in promo dollars, not green paper. ABC has already aired a couple of Tyson-Ruddock features on its regular sports programs, and it is also chipping in commercials, King said.

Casio, the electronics maker, contributed cable TV commercials in exchange for its designation as “official television timekeeper.”

The ad campaign is focused on cable TV because that’s where the highest concentration of likely pay-per-view subscribers--male sports fans 18 to 49--can be found, according to Showtime’s Kurnit. But King said he likes to have ads on the broadcast networks, too, because they lend “credibility” to events carried by their younger cable cousins.

And what of the product being sold?

Tyson tenderized Ruddock pretty well last March in their first meeting, which was stopped in the seventh round on a controversial ruling by the referee.

“Ruddock was losing but he hadn’t lost,” said an employee of the Mirage, which also hosted that fight. It’s a key distinction, as that modest suggestion of unfairness has been leveraged into a big-money rematch. When the technical knockout was called, Ruddock was alert enough to stare angrily into a ringside camera and mouth the question: “What?” That video sequence forms the backbone of the ad campaign now being flogged coast to coast.

Since the first Tyson-Ruddock fight last March, the “addressable universe” of homes that can be reached by pay-per-view has expanded by 1.5 million, Kurnit said.

Professional sports leagues--especially the National Football League--are also trying to figure out how to cash in. An indication of the potential was the great success of the Stanley Cup hockey playoffs as a regional pay-per-view event in Minnesota, where the underdog North Stars were a finalist.

“It only gets bigger,” said Shelly Finkel, a New York City music and boxing promoter.

Wynn, chairman of Mirage Resorts Inc., gets all excited about pay-per-view’s potential. Wynn is not a partner in the pay-per-view end of Tyson-Ruddock II--his profit comes primarily from the live gate--but he learned that side of the business by promoting a heavyweight title bout between Holyfield and James (Buster) Douglas at the Mirage last fall.

Tyson and King will split about 55% of the total take from pay-per-view, with the rest going to the local cable operators, Wynn said. King’s expenses are unknown, because King isn’t telling how much he guaranteed Tyson, Ruddock and the other fighters rounding out the program. Still, several people close to the event say that King could turn a profit with only half of the 1.9 million pay-per-view households that he expects.

In his office at the Mirage on Monday, Wynn mused that the only thing standing in the way of hundred-million-dollar, single-night profits is the lack of a truly galvanizing event, something that would draw women and men, young and old.

“Election night!” Wynn exclaimed. “That would be a great pay-per-view event!”

Boxing: Slicing the Pie Pay-per-view TV is now the top source of revenue in a big-time boxing event, such as Friday’s Tyson-Ruddock rematch. The chart, based on interviews with people involved in the fight, shows roughly where the money comes from . The live gate figure assumes a near sellout of the 16,000 -seat arena. The $45-million pay-per-view figure assumes that 1.3 million households buy the event at $34.95 apiece-a conservative estimate. Promoter Don King predicts 1.9 million households. If he’s right, add another $21 million. Gross revenue: $65.0 million Live gate, $8.5 million: 13.1% Closed circuit TV, $1.0 million: 1.5% Foreign TV rights, $3.5 million: 5.4% Delayed broadcast rights, $4.0 million: 6.2% Advertising sponsorship, $2.0 million: 3.1% Merchandising, $1.0 million: 1.5%