In his new, $365-million deal with the streaming service DAZN, middleweight boxing champion Canelo Alvarez is betting on a new frontier.
The big unknown is whether a sufficient number of boxing fans will subscribe to warrant what equates to a $33-million license fee per fight. The number of DAZN subscribers is not publicly known.
Alvarez, fresh off a majority decision over the previously unbeaten Gennady Golovkin in a pay-per-view extravaganza in Las Vegas last month, formally announced his association with DAZN on Wednesday at a news conference in New York. He is scheduled to fight World Boxing Assn. secondary super-middleweight champion Rocky Fielding at Madison Square Garden on Dec. 15, launching an 11-fight deal to be carried by DAZN through 2023.
John Skipper, who formerly led ESPN, is executive chairman of DAZN. Company officials have said they intend to expand their operation by pursuing rights deals with major sports.
“By bringing Canelo’s fights to DAZN, we will turn his pay-per-view success into a growth engine for subscribers — a truly transformational moment for our business and the entire industry,” Skipper said in a statement.
Later, in an interview, Skipper said the company was able to convince Alvarez and promoter Oscar De La Hoya that “the future of boxing is … in affordable subscriptions, so more fans can see the big fights that matter.” He added: “We also made them a financial proposition that allowed them to do that.”
Landing Alvarez, who has a record of 50-1-2, with 34 knockouts, gives DAZN the most popular boxer in the United States and Mexico — and one who, at 28, is positioned for a slew of quality middleweight bouts, including a potential trilogy meeting with Golovkin.
Alvarez previously fought under a deal with HBO, but the premium cable network recently announced it would no longer carry pay-per-view boxing. Showtime also bid for Alvarez, according to industry sources.
HBO charged subscribers $89.95 for the Alvarez-Golovkin fight last month, which drew 1.1 million buys. DAZN is currently available for a $9.99 monthly subscription fee, though Skipper said he couldn’t promise that the price won’t soon be raised. The service, which is also available in Canada, Italy, Germany, Austria, Switzerland and Japan, requires a smart television to connect to DAZN seamlessly. Otherwise, the action can be viewed over a laptop connection or on mobile devices.
“We’re convinced the economics can be transferred to a subscription,” Skipper said, “that the person who was willing to pay $85 for one fight will be thrilled to pay that money to get many months of a subscription that will provide fights every week.”
He added: “Canelo has financial security and he’s never done anything except take on all comers, so his interest aligns with ours to make great fights and grow the sport.”
Alvarez, in a statement, said he was “humbled to be selected to lead this new vision for the sport of boxing, which will without a doubt be for the benefit of the fans.”
De La Hoya said the deal underlines that “we are committed to making this sport as accessible as possible and at an affordable price for all the fans.
“DAZN has the perfect platform to make this dream come true,” he added, “and with the biggest star in the sport at the helm of this journey, I have no doubts that we will succeed in unimaginable ways.”
Whether Alvarez’s move to streaming is a harbinger for boxing as a business is debatable.
Richard Schaefer, the former Golden Boy CEO who promotes fighters for manager Al Haymon’s Premier Boxing Champions on Showtime and in a new deal on Fox, noted that pay-per-view was a proven platform for fighters to maximize revenue. As an example, he cited the nearly $500 million reportedly earned by Floyd Mayweather Jr. in two 2015 fights.
“This is a big number for Canelo, but in pay-per-view, there is no ceiling,” Schaefer said. “If Floyd Mayweather had signed a deal like that … then these numbers wouldn’t look so good.”
Schaefer expressed hope that Alvarez’s deal with DAZN would actually create more opportunities for his top performers — fighters such as lightweight champion Mikey Garcia, welterweight champion Errol Spence Jr., heavyweight champion Deontay Wilder and the Charlo brothers, Jermall and Jermell.
“The No. 1 pay-per-view star just retired from the pay-per-view platform,” Schaefer said, referring to the void created by the departure of Alvarez. “And those who think pay-per-view will disappear are wrong.”
DAZN launched in the United States last month, with England’s three-belt heavyweight champion, Anthony Joshua, successfully defending his titles by knocking out Russia’s Alexander Povetkin at Wembley Stadium. Late last month, it launched a new deal with Bellator MMA by streaming a card from San Jose.
DAZN has already begun assembling a group of championship-level fighters. Eddie Hearn, Joshua’s promoter, staged a follow-up card headlined by former welterweight champion Jessie Vargas on Oct. 6 in Chicago, and has another coming Saturday in Boston featuring middleweight Demetrius Andrade.
De La Hoya has a stable that includes former lightweight champion Jorge Linares, recent featherweight title contender Joseph Diaz Jr., popular prospect Ryan Garcia, and has ties to 154-pound world champion Jaime Munguia of Tijuana.
DAZN announced that De La Hoya would be executive producer of the live bouts that included Golden Boy fighters, and said it would add “new features with virtual graphics and social media interaction” to its productions.
De La Hoya’s library of 7,000 hours of fights spanning his career as a boxer and a promoter are included in the partnership, and the bouts will be available to DAZN subscribers. There will also be a live studio show.
9:15 a.m.: This article was updated with more details and comments about the DAZN deal.
This article was originally published at 8:50 a.m.