Question on sale of IPT
- Thread starter jjinfla
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jjinfla said:
Wow, Jake, did someone slip something into your drink? Some good posts of late...
It's not so much a question of what he's selling to Ho, but what he's selling to the players (and the fans).
NYC cue dude
Banned
Jake, good question
Kt is selling much at all, and i suspect ho isn't paying too much either.
The ipt represents a functioning, high end professional pool tour. The tournament system is already in place. The qualifying network is already in place. The vendor relationships are already in place. The marketing campaign has already begun. the line of merchandise is already in place. The vehicle of tv exposure is already in place, but after reading kts recent remarks, this would be detrmined as a debit.
The largest intangible asset of the ipt has remains untapped. I beleive forcing the players to sign an exclusive performing contract could be worth a tremendous amount. furthermore, if the bailout occurs, i would expect this to be the first order of business for ho to kick off the 2007 season.
In my mind, the above is worth between 3 and 4 million dollars. We already know that kt owes 3 million to the players, but i dont suspect he owes all that much more. The reno event was probably paid in full at the time of the event, such as the venue and other ancillary expenses. Perhaps he has an ongoing contractwith the versus, but that can be amortized as the events are aired.
So, i would bet that kt walks away from this profiting about a million, not bad for a years work. He will probably get a 3 or 4 year working contract, and a small percentage of the gross. I am also sure any deal would include free sponsorship for natural cures.
This would be my educated assumptions.
The theory becomes much more palatable if you reread the second line of this post.
rg
Kt is selling much at all, and i suspect ho isn't paying too much either.
The ipt represents a functioning, high end professional pool tour. The tournament system is already in place. The qualifying network is already in place. The vendor relationships are already in place. The marketing campaign has already begun. the line of merchandise is already in place. The vehicle of tv exposure is already in place, but after reading kts recent remarks, this would be detrmined as a debit.
The largest intangible asset of the ipt has remains untapped. I beleive forcing the players to sign an exclusive performing contract could be worth a tremendous amount. furthermore, if the bailout occurs, i would expect this to be the first order of business for ho to kick off the 2007 season.
In my mind, the above is worth between 3 and 4 million dollars. We already know that kt owes 3 million to the players, but i dont suspect he owes all that much more. The reno event was probably paid in full at the time of the event, such as the venue and other ancillary expenses. Perhaps he has an ongoing contractwith the versus, but that can be amortized as the events are aired.
So, i would bet that kt walks away from this profiting about a million, not bad for a years work. He will probably get a 3 or 4 year working contract, and a small percentage of the gross. I am also sure any deal would include free sponsorship for natural cures.
This would be my educated assumptions.
The theory becomes much more palatable if you reread the second line of this post.
rg
One thing to consider is that if Ho believes that the business has the potential to earn 50 million per year in a few years utilizing his resources such as internet gaming, government deals to purchase events (like the deals WPC has done in Taiwan and Philippines), VIP marketing, huge brand exposure to market his other services etc, then to him the potential value could be quite high, even though the IPT's figures for now may look weak.
Just like google just paid 1.65 billion for youtube which is losing over a million a month. It's the potential value combined with google's abilities to create additional value that made the price so high.
Just my guess, but I'd be suprised if the money paid for the IPT is as low as 4 million. If it is, then it does look like a bail out.
Colin
Just like google just paid 1.65 billion for youtube which is losing over a million a month. It's the potential value combined with google's abilities to create additional value that made the price so high.
Just my guess, but I'd be suprised if the money paid for the IPT is as low as 4 million. If it is, then it does look like a bail out.
Colin
Colin Colenso said:
I'm sure YouTube had more than a few suitors that set the market value of the company. Not only has a superb foundation built at YouTube, but high demand for a product/technology that facilitates the sharing of videos is viewed as virtually certain, so leveraging YouTbe shoud be easy for the folkjs at Google.
In contrast, it is arguable whether the IPT has built any kind of foundation at all, and there is nothing to support the contention that demand for the product they wish to market, known as pro pool, will be high. In addition, as the IPT does not own any rights to the players, it has little to sell.
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In my opinion, for the IPT to be successful, it needs to reach the mass market via tv. I know KT has said that the viewership results from OLN/Versus have exceeded his expectations, but coming from him what does that mean in terms of revenue and viewership?sjm said:
The IPT also needs to incorporate live programming. The current OLN/Versus programming is typically delayed by 3-6 months and is just too repetitive. How many times can one watch the LJJ vs. MS match?
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Colin Colenso said:
That's a long way from 150 Mil.
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NYC cue dude said:
I can't see the IPT selling for a profit, KT paid out a whole lot more then some people think, Venue cost including local union cost for rigging, staging etc.., employee cost including website, travel, all the TV time for LJJ/Sigel match, and one of the largest cost was to A. Smith and Co. for all the video production, camera crews, etc... A. Smith & Co. is not cheap, they are a well known production company with high standards, it was a huge expense.
Not counting any payouts, KT most likely has expenses somewhere north of 2 million. Add payouts and I think the IPT is in the rears by 5 million not including the 3 million from Reno. So I don't think he's getting any cash out of any deal, but I certainly agree with you that he is trying to hold onto an exclusive advertising spot on products, web, and on TV that over time could pay for those loses. KT is smart and instead of just letting the IPT fold and walk away losing millions he will try to get what he can in any way of TV time and print advertising, I can't see him pulling out any revenue sharing plan, that would be amazing to me, he could end up with some kind of future considerations.
The PBA was sold for something like 5 million to a few Microsoft millionaires when it went on hard times and owed it's players money. The PBA was in debt for 3 million at the time, but it had one thing the IPT doesn't, it still had Brunswick and the ABC deal on TV even though it was falling.
One thing is for certain the IPT is in debt, easy guess is 8 million, and that was expected for the first 2 or 3 years, KT just thought it would be somewhat less. Is there a buyer who would assume that debt? maybe, pay more? Not in my opinion, I think it takes a special buyer to just assume the debt.
Of course all this is just talk and he may have nothing lined up and just shopping like a mad man for a person to take over the IPT. 50/50
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jay helfert said:
Heya Jay.
There's just no way in hell that it sold for $150M USD. If I'm wrong about that then I guess I'm just wrong. I can live with that. Knott's Berry Farm sold for $245,000,000 (granted, this is 9 years ago). Are we to believe that the IPT is worth more than 50% of Knott's? Seriously, if I felt like doing just a *little* research into the subject, I could post various businesses/corporations/whatever that have sold for $150,000,000 USD and, I can assure you, it would be quite obvious that the IPT isn't worth anything near that.
Pool players, as a whole, are an extremely gullible bunch. I hate to say it because I wish this weren't the case, but pool is a joke in the real world. At least in the U.S., no one gives a rat's ass about it. Sure, it might be big in Asia but, even then, a tour that has put on a total of 3 tournaments, neglected to pay out prize money for one of then, and has nothing really but a "concept" to sell, isn't worth $150M USD (or its equivalent) in any country. Still, there will be those who believe this nonsense. There has to be some people out there willing to believe ridiculous claims otherwise KT would be broke. Who the hell would buy his books if there weren't suckers in the world?
Jimmy M. said:
Jimmy,
I refer you to the post I just made on the KT Letter thread. The IPT in its current form is worth exactly ZERO! Not four million, not three million, not one million, not one thousand, not one dollar!
Jimmy M. said:Jay! You're a naysayer!
In regards to the IPT and KT, I became one. Like many I hoped for the best, even lent my support, backing a couple of players. It soon became apparent that all was not as it seems in IPT land.
The latest fiasco and subsequent missives from IPT offices and KT, have only solidified my feelings that this is an ill fated venture, headed for the scrap heap.
Contrary to what some may believe, I feel the only hope the aggrieved pool players have, is for the loudest voices possible to shed light on the wrongs being perpetuated here by the IPT and Kevin Trudeau.
With the light shining brightly on him, KT may be forced to act in some way to correct his misdeeds, rather than simply skulking off to whatever hole he prefers to hide in.
This is like watching the TV show "Deal or No Deal" except there is no real money in the briefcase but the guy is really good at trying to convince you that there is... thru the use of smoke and mirrors.
Whatever happens KT's credibility is zero...which he does not give 2 craps about.... because his reputation was zero before the IPT.
His briefcase has real money in it, no smoke and mirrors in that. He obtained that money by writing a Flim Flam Book and he's taking that one with him.
The con guy is conning the hustkers and that is the bottom line.
ruk
Whatever happens KT's credibility is zero...which he does not give 2 craps about.... because his reputation was zero before the IPT.
His briefcase has real money in it, no smoke and mirrors in that. He obtained that money by writing a Flim Flam Book and he's taking that one with him.
The con guy is conning the hustkers and that is the bottom line.
ruk
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NYC cue dude said:
That would be the only thing that makes sense.
Now how in the world could he get the players to sign that contract?
Perhaps by yanking away the payout for Reno and letting the players think about what they are losing if they don't sign a contract.
Yep, if KT gets the players to sign on the dotted line then for sure he will have a viable, tangent asset that he can sell.
Jake
jjinfla said:
Why would that make it so much more viable?There hasn't been the slightest problem so far in getting the world's best to take part (well certainly not from the point of view of them choosing to take part in other events to the exclusion of taking part in an IPT event) and there's absolutely no reason to expect that there would be any problem in getting them to take part in the future,provided the prize money is adequate and is genuinely paid out.
Really can't see why any potential buyer would have that much added interest in IPT solely due to the existence of player's exclusivity contracts.In fact if anything the opposite is more likely. It's the very absence of any meaningful contractual committments to players which may be one of the few small attractions to a buyer.He doesn't have to worry about what they're owed by anyone else and he can dump those he doesn't want and replace them,especially if he's got a different audience in mind for the future.
Sure, I wouldn't compare Youtube to IPT, but moreso to point out the possibility that some properties can represent more value to some potential buyers than others.sjm said:
One could argue that the IPT has created a brand, that is building a foundation as the potential major brand behind pool product sales worldwide.
Still, it might take a good sales pitch to convince a buyer of that arguement.
We might consider whether Ho could set up his own tour at cost around $10 mill and go head to head with the IPT. But if they feel the IPT can continue and could have other buyers, then it may be easier to just be the highest bidder.
Could google have built their google video service to the no.1 with $1 billion of investment? I reckon so, but the risk factor in falling behind others in this rapidly developing online video business may have been too much.
Btw. I don't think the players are too expensive to get contracts with. Their value is still very low in comparison to other sports. Think of poker as a sport that didn't rely on big name players.
Just some thoughts.
btw: I have no idea where this 150m number came about. I think it was just some forum speculation.
My own guess is 30-60m, rather than a number in the single digits. Maybe we'll find out, maybe we wont.
Colin
The 150 million figure came from KT's own mouth during the Reno players meeting which you were probably at...can't blame you for nodding off though mate
You can listen to it again on the IPT site.From memory the (strange) wording was "insiders value the deal at around 150 million".More than strange in fact seeing as you can't be much more of an insider to a buyout than the guy who's selling.That wording only served to make it sound like he was reading a press release that wuld be fed to a newspaper hack so that the hack could later put his own name to it in 'report' format without having to do any editing work
You can listen to it again on the IPT site.From memory the (strange) wording was "insiders value the deal at around 150 million".More than strange in fact seeing as you can't be much more of an insider to a buyout than the guy who's selling.That wording only served to make it sound like he was reading a press release that wuld be fed to a newspaper hack so that the hack could later put his own name to it in 'report' format without having to do any editing work
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Colin Colenso said:
You're dreamin' Colin. ZERO!!!!
I won't say you're dreaming Jay, maybe you're right.jay helfert said:
But let me have a guess on the number. Plenty of punters have got it wrong before.
I do hope we find out the actual amount paid so we'll see who got closest to the mark
I'm willing to go all out an wager a beer!Colin