Pay-Per-View Piracy Reaching a ‘Crisis’ Point

LAS VEGAS – In the cat-and-mouse game of pay-per-view piracy, the mouse population is increasing and, as a result, the cats are sharpening their claws and teeth.

Amid unsubstantiated reports claiming that last month’s undisputed heavyweight title fight between champion Oleksandr Usyk and Tyson Fury generated 20 million illegal stream views costing broadcasters $100 million in lost buys, industry experts admit that distributing content online has opened a wealth of challenges to combat fight-stealing thieves.

“Piracy now is certainly as bad or worse as it’s ever been and if someone wants to call it a crisis, I wouldn’t disagree,” said former Showtime Sports President Stephen Espinoza, who currently serves as an independent sports media consultant.

“The ubiquity of streaming – there used to be a resistance factor, like it was hard to find and difficult to do – is such now that people can stream from many different sources. It’s a major, major problem, and a low estimate is it’s taking away 30 percent of our buys.”

All it takes is a fight-night look online or on social media to see a flurry of posts advertising free streams of pay-per-view bouts such as Saturday’s Gervonta “Tank” Davis-Frank Martin lightweight-title card, which costs $74.95 on Amazon’s Prime Video and PPV.com.

The exposure to such financial loss has inspired broadcasters to ramp up their policing efforts.

An individual connected to Saturday fight promoter Premier Boxing Champions said – depending on the fight – the company employs dozens of employees, spending six figures per bout to scour the internet and social media and shut down the free streams.

Additionally, Prime Video retains its own streaming policing operation and distributors like PPV.com monitor unauthorized streams and work with promoters to shut them down.

Unlike the cases with closed-circuit piracy at brick-and-mortar establishments, where distributors police bars and restaurants who offer the fight without paying a fee and can threaten or actually sue to collect substantial fines, nabbing the online perpetrators is far more difficult.

“If I could, I would fine them all. I want to,” a PBC official said.

The problem, they said, is that the chase becomes a version of “Catch Me If You Can,” with the broadcaster locating an IP (internet protocol) address, with usually no other identifying information.

In December, a UFC attorney testified before the House Judiciary Subcommittee on Courts, Intellectual Property and the Internet, bemoaning the fact that even when copyright holders like the UFC and boxing promotions issue takedown orders to enforce their copyright, online service providers including Facebook, Twitch, X and YouTube have been slow – up to or beyond an hour – to remove the stream.

Thus, a good portion – if not all – of the fight is available for free view. Additionally, the UFC and boxing promoters lament the immediate and illegal distribution of pivotal highlights that only those buying the stream should be seeing.

In a December Sportico story, it was estimated that piracy is costing the global sports industry $28 billion per year.

Mark Boccardi, senior vice president of programming and marketing for InDemand and PPV.com, likened the shuttering of free streams as a game of “whack-a-mole.

“It’s prevalent. So much of this stuff is cloak and dagger. You’re trying to reach out to someone whose real identity you might never get to know.”

Boccardi said he has “no assurance (the Usyk-Fury piracy) numbers are accurate and I don’t know how you’d measure it. But is piracy a concern? Yes, of course it’s a big concern.

“Anytime you have something you’re charging for and consumers are trying to find a way to circumvent that and get it for free, that’s a huge problem.”

(Disclosure: I’m also employed by InDemand/PPV.com, contributing live fight-night chats with Hall of Fame broadcaster Jim Lampley during major bouts, including Davis-Martin).

Piracy is nothing new.

Mark Taffet, who served as HBO senior vice president in charge of pay-per-view from 1991-2015, reminded it dates to the use of a “black box” that could tap into cable feeds.

“What’s interesting is – back then and to this day – is that piracy usually comes from the titillation of stealing,” Taffet said. “The people hosting pay-per-view watch parties usually don’t want to risk the embarrassment of their signal or stream getting shut down.

“I say this because back in the 1990s, we had incredible black-box activity, and yet we still often did 1 million buys,” Taffet said. “Piracy is an enormous irritant and an occurrence you can’t deny, but it seems mostly to be a singular thing – one person wanting to get something for free.”

Like Taffet, Boccardi isn’t convinced most pirates would buy the pay-per-view.

Taffet’s run included the 2 million-plus buys for Floyd Mayweather Jr.’s victory over Oscar De La Hoya in 2007 and the most lucrative PPV of all time, the 4.6 million buys shared by HBO and Showtime in the 2015 Mayweather-Manny Pacquiao bout.

Yet, last year’s knockout victory by Davis over popular rival Ryan Garcia has been the only 1 million-plus-buys boxing bout in nearly two years as even the sport’s most powerful draw, Canelo Alvarez, has languished in the 500,000-buys range after topping 1 million buys in his September 2022 trilogy victory over Gennadiy Golovkin.

A DAZN spokesman declined to reveal how many buys Usyk and Fury generated as their rematch looms Dec. 21 and he also wouldn’t hazard a guess at how widespread the Usyk-Fury piracy was.

He disputed a report that a wealth of free streams seemed to be intentionally allowed to exist throughout the fight, but released this statement in response to the entire issue:

“Sports piracy is theft. DAZN invests a significant amount in combating it, using technology to monitor the activity of users, and educating fans about the risks. It may seem a victimless crime, but most illegal feeds are provided by criminal networks or carry the risk of phishing and identity theft. Our advice is don’t risk the sport you care about – or your own data – by using illegal feeds.”

While Alvarez operates with the safety net of a guaranteed purse, every other fighter is reliant on their cut from pay-per-view buys, so the piracy is swiping funds from their bottom line.

Last week, when both Ryan Garcia and Devin Haney complained that they had yet to collect their pay-per-view cuts from their April 20 bout promoted by De La Hoya’s Golden Boy Promotions and streamed by DAZN and Golden Boy responded that its contracts spell out when those figures need to be finalized, it revealed how the wait for those pay-per-view figures is obviously harrowing, knowing the uncertain toll of piracy.

“A lot of times when pay-per-view results are lower than expected, people point to piracy when (low buys are) often because consumers aren’t that interested in the fight,” Taffet said.

“There’s way too many fights on pay-per-view, especially when consumers are asked to pay for a fight on top of what they already pay for their subscription to that distributor.”

Yet, Boccardi said there often isn’t an effective alternative other than pay-per-view when sponsorships and television license fees can’t generate the types of purse money desired by the fighters.

“Not every event has to do 750,000 or 1 million pay-per-views to be considered a success,” he said. “That’s the one thing people lose sight of, because not every fighter is guaranteed the money you’re paying to Canelo or Pacquiao or Mayweather.

“Some of these events that industry observers say are unsuccessful are in fact profitable for the fighters and promoters. On their own, some of these fights are doing well on pay-per-view – and they would do better if piracy didn’t exist.”

Espinoza said “it will take a combined effort of technological advances including digital fingerprinting advances, a lot of enforcement, better marketing and legislative efforts” to better address piracy.

Until then, there’s two pay-per-view fights: the combatants inside the ring and cat versus mouse.