What Madison Square Ga...
By Thomas Hauser: When Seth Abraham left his position as president and chief executive officer of Time Warner Sports In 2000 to become executive vice president and chief operating officer of Madison Square Garden, fans hoped that the Garden would once again become The Mecca of Boxing. Abraham had developed and managed all sports strategies at HBO, but the sweet science was his signature sport. U
By Thomas Hauser: When Seth Abraham left his position as president and chief executive officer of Time Warner Sports In 2000 to become executive vice president and chief operating officer of Madison Square Garden, fans hoped that the Garden would once again become The Mecca of Boxing. Abraham had developed and managed all sports strategies at HBO, but the sweet science was his signature sport. Under his leadership, the network had become the most powerful force in boxing.
The highpoint of Abraham's tenure at the Garden was the 2001 middleweight championship tournament. Just before the bell rang for the grand finale between Felix Trinidad and Bernard Hopkins, Dave Anderson of the New York Times approached him and said, "This feels like the forties."
But things went downhill from there. Twenty-six months passed before there was another fight card in the main arena. Abraham departed. MSG is now largely out of the boxing business. The last time the Garden hosted more than three fights in a calendar year was 2000. Las Vegas has the aura that once attached to Madison Square Garden as the fight capitol of the world.
On June 10th, boxing returns to the Garden's main arena for the first time in 364 days. Miguel Cotto versus Paulie Malignaggi is the featured attraction. The undercard has a little bit of everything for New York's melting-pot demographic. Hence, this is a good time to examine what MSG boxing is and could be.
Madison Square Garden is the most famous arena in the world with the most hallowed tradition in boxing. Properly marketed, that history is a huge asset. New York is media capitol of the world and the biggest stage on the planet. There are 22,000,000 people in the metropolitan area; 8,000,000 of them in New York City. The Garden sits atop two major transportation hubs. MSG also has its own television network.
Against that backdrop, there are two major problems associated with promoting fights at the Garden. The first is cost. New York is expensive. Food and lodging are costly. Advertising rates are high. Taxes are burdensome. And because of rent and labor charges, MSG has what some promoters consider a cost-prohibitive price structure.
"When you rent the building," says Bob Arum (who will be promoting at the Garden on June 10th), "it costs about $400,000 to open the main arena and $125,000 to open The Theater. Then there's hotel and meals, which are free in Las Vegas. So if you go into the main arena, you're a half-million dollars in the hole when you start. You're not getting a site fee. And sponsorship opportunities are limited because the Garden already has in-house deals that prohibit the promoter from making deals with certain competing sponsors."
Likewise, the television networks don't exactly drool over the prospect of having a big fight at the Garden. Yes, they like the New York media buzz. But union costs at the Garden are high. And the production crew for a big fight numbers roughly eighty people, all of whom need rooms to sleep in and have to be fed three times a day. Television production costs for a fight at the Garden are 25 to 35 percent higher than production costs for fights at most other venues.
Also, there's a problem with dates. The Garden is in the business of booking dates. Rental income is a huge component of its balance sheet, and it's a busy building. The Knicks and Rangers have first call on the main arena. Then come the circus and other annual events. Concerts, college basketball, and other happenings are scheduled far in advance for both the main arena and The Theater
Moreover, in the real world, the Garden can't say, "The building is free on such and such a date. Let's get a big fight for that night." More often than not, a television network first decides that it wants an event on a certain evening. Then the fighters are chosen. Selecting a site is far down on the food chain and often, when it's time to make that decision, the Garden simply isn't available.
The last concerted effort that Madison Square Garden made to become a force in boxing came in 1985, when Bobby Goodman was hired as a senior vice president. Goodman oversaw the development of future champions like Buddy McGirt, Kevin Kelley, Junior Jones, Aaron Davis, and Tracy Harris Patterson. But there were too many mismatches on Garden-promoted cards and attendance suffered. Finally, in 1993, changing ownership (in recent decades, the Garden has been owned by Gulf & Western, Paramount, Viacom, and Cablevision) and image problems associated with the sport led MSG to discontinue its boxing program.
Some people think that the Garden should promote boxing again, but that's not likely to happen. With its National Basketball Association and National Hockey League franchises, MSG knows pretty much what it's getting each year. As a boxing promoter, it wouldn't. Also, as a public corporation with open books and fiduciary obligations to shareholders, the Garden might have significant problems dealing with the world sanctioning organizations and taking the other steps necessary to thrive as a boxing promoter.
Thus, if Madison Square Garden chooses to become more active in boxing, it's likely to do so by partnering with one or more existing promoters.
The structure of power with regard to boxing at Madison Square Garden is, in descending order, as follows. James Dolan is chairman of MSG as well as president and CEO of Cablevision. Hank Ratner is vice-chairman of MSG and Cablevision and the number-two man in the corporation. Bob Pollichino is MSG's chief financial officer. Steve Mills is president and chief operating officer of MSG Sports. And Joel Fisher is MSG's senior vice president for sports properties.
Fisher is the Garden's point man for boxing. He knows the building, is well-liked, and has a reputation for being a good businessman. But he wears a lot of hats and, by his own estimation, spends only twenty percent of his time on boxing.
As a general rule, the Garden enters into two types of deals with promoters. First, there are "four-wall" deals, where the promoter rents the main arena or The Theater and pays extra for everything from ice cubes to labor. Alternatively, the Garden sometimes enters into cost-and-profit-sharing arrangements.
All of the Garden's fight cards this year (including Cotto-Malignaggi) have been four-wall deals. The last time it had a full partnership with a promoter was with Don King for the 2001 middleweight championship tournament.
The main arena and The Theatre offer different environments for fights. Step one in rebuilding Madison Square Garden boxing would be to lay a solid foundation with regularly-scheduled fights in The Theater. The Garden should be able to sign agreements with promoters to fill slots in The Theatre on a once-a-month basis. There's a lot of young talent in the New York area, and more fighters would gravitate here if more fights were available. Also, the biggest obstacle that most promoters face is the difficulty in getting television dates. The Garden has MSG Network, which can be used as a development tool for young fighters.
As for the main arena; costs in New York are what they are, but a promoter can charge higher ticket prices for a fight at the Garden than in almost any other venue. By way of example, the 1999 match-up between Evander Holyfield and Lennox Lewis drew a live gate of $13,500,000.
Garden officials won't divulge internal cost data. But best estimates are that it costs MSG $75,000 to open the main arena and $30,000 to open The Theater. That's out-of-pocket cost with no mark-up or allocation for lost rent. The Garden could host some very good fights by paying promoters a license fee of $150,000 per card to put shows in The Theatre eight times a year and $1,200,000 per card for four shows annually in the main arena. The Garden would keep the live gate, sponsorships, and signage. The promoter would get all domestic and foreign television money. In other words, $6,00,000 would buy twelve fight nights for the Garden. The Madison Square Garden brand could be extended to Radio City Music Hall, the Apollo Theatre, and other New York sites.
Six million dollars is a lot of money. But the New York Knicks payroll for the 2005-2006 season was $125,000,000 (the highest in the NBA) and the team finished with a record of 23 wins against 59 losses. If the Knicks can invest $30,000,000 in Jerome James (who scored a total of 137 points during the entire season and was suspended for several games in January for "conduct detrimental to the team"), it can invest in boxing. One might also note that the New York Rangers (the Garden's other high-priced franchise), made the Stanley Cup playoffs this year for the first time since 1997 and suffered an embarrassing four-games-to-none first-round elimination.
If the powers-that-be at Madison Square Garden decided to rejuvenate boxing, one logical step would be to sign contracts for the services of certain fighters. Boxing is a personality-driven business; and right now, there's no face of MSG boxing. In the past, Felix Trinidad would have been perfect for that role. Ditto for Evander Holyfield and Arturo Gatti. As for the future; how about Jermain Taylor and the winner of Cotto-Malignaggi? John Duddy would be a perfect Garden fighter.
Boxing is a sport that appeals to ethnic loyalties. Madison Square Garden doesn't have the glitz of Las Vegas, but it does have a connection to the raw ethnicity of New York. The Garden should have fight cards every year on the eve of St. Patrick's Day, Columbus Day, and the Puerto Rican Day parade.
There's no worse place to make a mismatch than Madison Square Garden. The arena is haunted by the ghosts of great fighters and the crowd is knowledgeable. Fights in casinos attract customers; fights in New York attract fans. Thus, Garden cards should reflect more than the desire of promoters to get wins for the fighters that they have under contract. They should be competitive.
But there's one prerequisite that comes before all others. And here, the thoughts of Seth Abraham are instructive.
"Boxing needs a longterm commitment to succeed," Abraham said recently. "That's true whether you're an arena, a network, a promoter, a manager, or a fighter. There are ups and downs and nothing happens overnight. My failing at the Garden was that I couldn't quite figure out which levers to pull to get Cablevision to make that commitment. The closest I came was the 2001 middleweight championship tournament. The tournament was predicated on our desire to get Felix Trinidad to fight at Madison Square Garden. The Garden put up a substantial guarantee for the three fights in that tournament. If Trinidad had beaten Bernard Hopkins in the final, Roy Jones would have been his next opponent. Felix and Don King had already signed contracts for the fight and Roy had agreed to the numbers. The fight would have been at the Garden or Yankee Stadium. It would have been the biggest non-heavyweight fight in the history of boxing, and it would have changed the course of boxing at Madison Square Garden. Trinidad-Jones would have gotten everyone's attention at Cablevision and probably would have led to a longterm commitment within Cablevision to boxing."
Boxing on a piecemeal basis isn't a program. And opening the Garden for a few one-shot deals each year won't build one. The Garden has to define where boxing fits into its philosophy for the future. Is it a priority or simply a fill-in event for nights when the main arena or The Theater is available? Also, because the popularity of boxing is keyed to charismatic champions and big fights, the program must be long-term with sufficient nourishment for growth. The Garden has to be willing to ride out the inevitable periods when there are economic losses.
No one show is a barometer of the potential for boxing at Madison Square Garden. "The biggest mistake I made in boxing," says Seth Abraham, "was the deal I made for Evander Holyfield versus Larry Holmes. HBO lost $3,500,000 on that fight, but it didn't get out of boxing because it had a commitment to boxing. And the success we had after that speaks for itself."
Unlike most promoters, Madison Square Garden has the financial resources to drill for oil and ride out cyclical downturns if it chooses to do so. But to succeed, the people in charge will have to be proactive. They can't wait for the telephone to ring. They must create and initiate.
Also, the most successful promotional companies have good staffs that know boxing. There are some very capable people at Madison Square Garden, including Joel Fisher. But no one there has his finger on the day-to-day pulse and fully understands the inner workings of boxing. The Garden needs a boxing guy to spearhead the program.
However, having said all of this, it should be added that boxing deals often don't make economic sense unless they're subsidized by premium cable subscribers, high rollers, or pigeon investors who will ultimately lose money. Thus, Fisher is on solid ground when he says, "We're not going to make a bad deal just to land a big fight or to say that we have a boxing program. We're running a business. We need deals that make economic sense. Show me a business plan for a boxing program that will make money, and we'll use it."
Boxing is unlikely to experience a Golden Era anytime in the near future, and boxing at Madison Square Garden won't either. The most optimistic inside projections have MSG partnering with one or more promoters for up to six shows a year in The Theater and two or three in the main arena. It's unlikely that the sweet science will return as the Garden's third sports franchise or that MSG will again become a dominant force in boxing.
But it's critical to the future of boxing for the sport to have a vibrant east-coast presence, and there's no better place for that than Madison Square Garden. And keep in mind; great events brand an arena. The fact that AliFrazier I and other historic battles were contested within its walls casts an eternal glow over all of Madison Square Garden.
Thomas Hauser can be reached by email at email@example.com