UFC Announcement: No Fedor, Franklin vs. Belfort, Tito!

July 31, 2009

The following is a recap and analysis relating to the various pieces of information the UFC released during a 2pm EST press conference this afternoon.

Recap:

– Dana White opens the press conference talking about Fedor Emelianenko: no deal

– Rich Franklin vs. Vitor Belfort at 205lbs. (Dallas, September)

– Henderson in line for a title shot rematch with Silva

– ESPN UK (Launches August 3rd, three-year deal, starts Aug 8th with UFC 101)

– Tito Ortiz is back! Possibly a fight against Mark Coleman in November/December

– Dana White on TV deal: more suitors now than ever before, broadcasting control only an issue with HBO, he’s starting to like what he’s hearing more than ever. He was asked specifically about ESPN in the US; very mum.

Payout Opinion:

I’m skeptical of Fedor potential impact in the UFC for the following reasons/concerns:

– Is he capable of drawing significant PPV interest?
– Can he become a cross-over star?
– What would the UFC have to invest in order to make this happen?
– How committed is he to the organization?
– And how much control does his management team exert over him?

Most importantly, however, what about the risk involved? Fedor may be unready or unwilling to carry the marketing workload that a dominant heavyweight like Brock Lesnar (and his polarizing personality) can manage with ease.

Of course there are many caveats with the above, but the main lesson is: be careful what you wish for. Fedor may have come to the UFC and fulfilled all expectations…but then again he may not have. We all know how tempermental and potentially expensive it can be to mismanage expectations. 

And, really, the truth of the matter is that with or without Fedor, the UFC is on pace for a tremendous year – a record year. They’ve been lighting up the PPV trail, diversifying their revenue streams by adding non-event related items like UFC: Undisputed 2009, and they just completed an epic UFC 100 weekend to round out just half the year.

They’re looking to continue their first half momentum with a host of brilliant cards (UFC 101 has a chance to do big numbers – partly piggy backing off the residual interest in UFC 100) and the hotly anticipated Ultimate Fighter 10 featuring Kimbo. Plus, they’ve just re-signed PPV big gun Tito Ortiz who is likely to help bolster a huge end of the year card. Now that Tito is back in the UFC’s good graces you can bet he’ll receive a significant push, and as a result, the UFC will benefit from that immensely.

—–

According to the UFC, nearly 25 million people tuned in to watch UFC 100 last month on Groupo Televiso – the UFC’s brand new TV partner in Mexico. Tito Ortiz coming back to the UFC is more good news its push into Mexico.

What kind of impact will Tito have on those numbers this fall? Huge.

Moreover, how quickly will the UFC’s first show in Mexico City sell-out if it features a headlining Tito? Fast.

The combination of Ortiz, Velasquez, and Escudero could be very promising for the UFC in Mexico. I also wouldn’t be surprised if we saw some sort of new endorsement deal between Bud Light and Ortiz (in the mold of the ones Velasquez and Escudero received). Ortiz mentioned a Bud Light deal in jest as Dana was asked about the fallout from Brock’s post-fight at UFC 100, but it’s definitely something to keep in mind.

—-

It doesn’t really come as a surprise that Franklin was unwilling to fight Wanderlei at 185lbs, and thus equally unwilling to fight Vitor at 185lbs either. Edit: The fight will take place at a catch weight of 195lbs. and will still have ramifications on both the 185 and 205 divisions.

I don’t want to speculate too much, but I will point out that a win over Franklin would likely pit Belfort against the winner of Marquardt and Maia later this month in a bid to create the next middleweight contender after Dan Henderson. Likewise, a win over Belfort would likely push Franklin even further up the 205 chain into a possible contending match with anyone of the top tens looking for an opponent.

Nonetheless, the addition of Belfort gives the 185 division a breath of fresh air. Between Maia, Marquardt, Cote, Leites, Bisping, and now Belfort, things are very interesting at middleweight.

—–

In addition to Belfort, Dana mentioned that former Affliction fighters like Dan Lauzon, Paul Daley, Ben Rothwell, Chase Gormley, and Rafaello Oliveira have been added to the UFC roster. The WEC will also pick-up Mark Hominick, Javier Vasquez, and L.C. Davis.

No word on Takanori Gomi or Chris Horodecki.

ESPN UK Adds UFC

July 30, 2009

Today, ESPN announced that it has reached an agreement with the UFC to air PPV events – in addition to other programming – on its new ESPN UK channel. The coverage will also extend to Ireland.

MMA Weekly with the details:

ESPN, the leading sports network in the States, is set to launch in the U.K. and Ireland on Aug. 3…with the Ultimate Fighting Championship in tow.

 

The network issued the announcement Thursday, giving the UFC a new carrier in the U.K. and Ireland following the demise of its former partner Setanta Sports.

 

“ESPN’s aim is to serve UK and Ireland sports fans by bringing the very best of both domestic and international live sport to their living rooms. We are delighted to add UFC, TOP 14 ORANGE, the leading French Rugby Championship, the Australia Football League, EuroBasket and DTM to our growing portfolio of live sport,” said Jeroen Oerlemans, ESPN’s Vice President, TV Channels Europe, Middle East and Africa.

 

UFC U.K. Division President Marshall Zelaznik commented on the agreement, saying, ““We are ecstatic to announce that ESPN is the new home of the UFC in the UK and Ireland. ESPN is one of the most trusted and respected brands in all of sports broadcasting, and we are thrilled to be working with them as they launch their new channel in the UK and Ireland.”

 

The agreement begins with UFC 101 on Aug. 8 and encompasses all live UFC events including UFC Fight Night events, according to a report from Gareth Davies of the British newspaper “The Telegraph.”

 

Payout Opinion:

The UFC has succeeded in replacing Setanta as its television partner in the UK, but the agreement with ESPN UK is far from a slam dunk for the organization.

The good news is that ESPN UK will launch on both of the UK’s major television networks – Sky and Virgin Media – opening the channel to a potential subscriber base of over 20 million Britons. However, the bad news is that ESPN UK will, in many cases, be packaged as a premium subscription channel (not a base subscription channel). Sky customers will seemingly have to pay extra regardless of their channel package. While Virgin customers will have the channel included for free only with a subscription to the XL channel package. Any of the smaller Virgin TV packages will still require an extra sum per month to gain access to ESPN UK.

A quick peak at the ESPN UK TV line-up suggests the content rotation is heavily geared towards European football and that should undoubtedly draw some interest. Whether the UFC can capitalize on that interest and exposure remains to be seen – the football demographic isn’t the typical target cross-over demographic for MMA.

CNBC's "Fistful of Dollars" Recap

July 30, 2009

CNBC’s “Ultimate Fighting: Fistful of Dollars” premiered last night, taking viewers back inside the Octagon for a second look at the sport of mixed martial arts and the UFC, in particular.

The show was clearly designed for general audiences; thus, it didn’t divulge much in the way of facts or statistics that we have yet to hear or read about. I did, however, make a few quick notes on some of the more interesting business points from the segment:

– In 2008, the UFC generated nearly $275 million in revenue which represented an increase of 37% over two years.

– The UFC (or MMA in general) brought nearly $86 million in non-gaming revenue to the city of Las Vegas  in 2008.

– Tapout, the industry leading clothing label, has seen its revenues grow at nearly 300% since the beginning of 2007; the company generated $120 million in revenue in 2008.

Overall, the show was quite well balanced. It covered the wide spectrum of MMA – the NHB days, John McCain’s cockfighting, the Zuffa purchase of the UFC, new sanctioning/rules, etc. – but, it also took a look at the sport from multiple perspectives, including that of the fighters, apparel makers, sponsors, government, and UFC competition.

Upon reading about the planned feature – and its title – I envisioned some sort of cynical tone whereby they’d paint MMA promoters as a bunch of greedy, morally uninhibited scoundrals that had taken advantage of a new blood thirsty generation to attain significant profits. Definitely not the case here and well worth your time to check out the hour-long segment.

Station Casinos Inc. Downgraded To 'D' On Bankruptcy Filing

July 30, 2009

— Station filed for Chapter 11 bankruptcy protection.

— We lowered our issue-level rating on the company’s senior secured debt to ‘D’.

— We revised our recovery rating on the company’s senior unsecured notes to ‘5’ from ‘4’.

NEW YORK, July 29, 2009–Standard & Poor’s Ratings Services said today it lowered its issue-level rating on Las Vegas-based Station Casinos Inc.’s $900 million senior secured bank facilities to ‘D’ from ‘CCC’. We removed these ratings from CreditWatch, where we placed them with negative implications on Dec. 15, 2008.

In addition, we revised our recovery rating on the company’s senior unsecured notes to ‘5’ from ‘4’. The ‘5’ recovery rating indicates our expectation of modest (10%-30%) recovery for lenders in the event of a payment default.

We had previously lowered all other ratings on Station, including the corporate credit rating, to ‘D’ following missed interest payments on each of the company’s five senior unsecured and senior subordinated notes earlier this year.

The issue-level ratings downgrade follows yesterday’s filing for Chapter 11 bankruptcy protection in the U.S. Bankruptcy Court for the District of Nevada by Station Casinos Inc. and various of its affiliates. Pursuant to an agreement with the company’s senior secured lenders, none of Station’s casino operating subsidiaries or affiliates were included in the Chapter 11 filings.

This rating action follows our Feb. 4, 2009, research report in which we lowered our corporate credit rating on Station and our issue-level rating on its 6.5% senior subordinated notes to ‘D’ following the missed Feb. 1, 2009, interest payment on the 6.5% senior subordinated notes. At that time, Station also announced a solicitation for votes from eligible institutional holders of its senior unsecured and senior subordinated notes for a restructuring plan under Chapter 11 of the U.S. Bankruptcy Code. We also subsequently lowered our rating on Station’s 7.75% senior notes, 6.875% senior subordinated notes, 6.625% senior subordinated notes, and 6% senior notes to ‘D’, following missed Feb. 15, March 1, March 15, and April 1 interest payments on those notes, respectively.

Complete ratings information is available to RatingsDirect subscribers at www.ratingsdirect.com. All ratings affected by this rating action can be found on Standard & Poor’s public Web site at www.standardandpoors.com; select your preferred country or region, then Ratings in the left navigation bar, followed by Find a Rating.

Update: EA MMA PR Typo

July 29, 2009

Per EA Sports Publicist, Katherine Coulthart:

Please note there was an incorrect statement in today’s earlier EA SPORTS MMA press release about Fedor Emelianenko.  The earlier release stated:

 

“Fedor Emelianenko, a 6’0”, 231 pound Russian heavyweight mixed martial arts fighter, who excels in Sambo and Judo, holds a 30-1 record and is the current WAMMA Heavyweight champion. Prior to signing on with STRIKEFORCE, Emelianenko defended his WAMMA championship by knocking out former UFC Heavyweight Champion Andrei Arlovski.”

 

This statement is incorrect and Emelianenko has not signed with any MMA fight promotion company as he stated in his press conference this afternoon.  We have no insight as to where Emelianenko will sign and was a misstatement on our part.  The only announcement we are making today is that Fedor Emelianenko, Gegard Mousasi and Renato Sobral will be in our EA SPORT MMA video game.

 

Thank you and I apologize for any confusion.

EA MMA: Typo or Slip of the Tongue on Fedor?

July 29, 2009

As Robert Joyner posted earlier, EA MMA announced today that Fedor Emelianenko will headline EA MMA’s fight roster for their coming video game (set for release Summer 2010).

But, check the curious inclusion made in today’s official press release:

REDWOOD CITY, Calif., – July 29, 2009 – Electronic Arts Inc., (NASDAQ: ERTS) announced today that Fedor Emelianenko, the world’s top ranked* MMA heavyweight, will headline the EA SPORTS™ MMA fighter roster.  Emelianenko will be joined by Gegard Mousasi and Renato Sobral, both of whom will be featured in a title bout at the STRIKEFORCE fight on August 15, as the first of a long list of fighters who will appear in EA SPORTS MMA, the all-new mixed martial arts title coming in 2010. 

 

“I have fought all over the world and I am excited to be in EA SPORTS MMA because this game is going to show the global appeal of mixed martial arts,” said Emelianenko.  “I know MMA fans have been wanting to play as me and pitting me against any opponent. Now they will have their opportunity.”  

 

Fedor Emelianenko, a 6’0”, 231 pound Russian heavyweight mixed martial arts fighter, who excels in Sambo and Judo, holds a 30-1 record and is the current WAMMA Heavyweight champion.  Prior to signing on with STRIKEFORCE, Emelianenko defended his WAMMA championship by knocking out former UFC Heavyweight Champion Andrei Arlovski.   

 

Gegard Mousasi, a former Dream Middleweight champion, has a current record of 25-2-1 and won his last match in Dream 9 against Mark Hunt this past May.  The 6’1”, 185 pound Dutch-Armenian fighter will be taking on Renato Sobral to determine STRIKEFORCE’s Light Heavyweight champion and has a fight style that is a unique blend of Dutch kickboxing and judo.

 

Sobral, hailing from Brazil, is known for his aggressive style, grappling prowess, and high-caliber submissions.  He is the current STRIKEFORCE Light Heavyweight champion and has a record of 35-8 with his last victory coming against Rameau Thierry Sokoudjou at Affliction: Day of Reckoning fight earlier this year. 

 

I am very excited to have Fedor, the number one heavyweight in the world, as one of the top fighters in EA SPORTS MMA,” said Executive Producer Dale Jackson.  “He is one of the elite fighters in the sport today and will provide the ultimate competition for our gamers.  The EA SPORTS MMA team at Tiburon has been working on the game for over a year already and we will have a lot more great fighters and other exciting news to talk about soon.”

 

In addition to appearing in the EA SPORTS MMA video game, Mousasi and Sobral will be sponsored by EA SPORTS for the STRIKEFORCE fight. 

 

EA SPORTS MMA will feature the most authentic, intense and broad mixed martial arts experience to date – complete with a vast array of top fighters and fighting styles from around the world.  EA SPORTS MMA will be available on the Xbox 360® video game and entertainment system and the PLAYSTATION®3 computer entertainment system.

 

Payout Opinion:

It’s quite likely that whoever wrote the press release is not familiar with MMA and made a simple mistake in writing that Emelianenko has signed on with Strikeforce – just about everyone else licensed for the game is fighting for Strikeforce.

On a business note, EA MMA will be sponsorsing the up-coming Strikeforce title fight on August 15th between Renato “Babalu” Sobral and Gegard Mousassi.

The UFC may not enjoy having a competing product for its video game, but there are tremendous benefits to competition: it helps to eliminate developmental complacency, thus spurring innovation; intellectual piggy-backing tends to occur which, like a rising tide, helps to float all boats; and, in this case, competition has also brought another blue chip sponsor to the MMA fold – Electronic Arts.

Ultimate Fighting: Fistful of Dollars Premiers Tonight on CNBC

July 29, 2009

On Wednesday, July 29, CNBC takes viewers back inside the Octagon with “Ultimate Fighting: Fistful of Dollars,” revealing how the UFC continues to grow – even as other professional sports face financial crisis. While the recession is putting a beat-down on the economy, Ultimate Fighting’s revenues are up 30%. CNBC’s Scott Wapner travels to Germany for the UFC’s first-ever event in mainland Europe and speaks with Dana White, as well as billionaire backers Lorenzo and Frank Fertitta. Hear what they have to say about the sport’s successes, challenges and growth. And, in just 18-months since CNBC first took viewers inside the UFC, see how this controversial sport has flexed its muscles worldwide to include major sponsors, product endorsements and brand extensions.

Fedor Headlines EA MMA Game

July 29, 2009

In what may be the highest profile signing so far, Fedor Emilianenko announced during his conference call today that he would be signing with the EA MMA game to be released in 2010. Aslo included in the announcement were the official inclusion of Gegard Mousasi and Renato Babalu Sobral. Emilianenko will join other notables such as Randy Couture, Tim Sylvia, tim Kennedy, Benji Radach, Frank Shamrock, and “King” Mo Lawal.

It is not known at this time what impact Fedor’s signing will have on a possible deal to get the Russian star inside the Octagon. The UFC has previously indicated that anyone signing on with the EA game will be blackballed from the UFC. If all other issues are cleared between the two parties, it would be a bit hard to believe this would be the stumbling block that would derail a deal. Such statements of bravado make for good copy, but crow will be happily consumed over such talk if the UFC are able to sign the one MMA star that has eluded their grasp. The UFC and Fedor’s management are currently in talks, with conflicting reports flying about on the possibility of the Fedor’s signing. As we have stated earlier, even if a deal gets done the chances of an imminent announcement, if at all, are not good.

What Affliction MMA Should Have Been

July 29, 2009

By Kelsey Philpott

The fact that Josh Barnett’s positive test for anabolic steroids was able to bring down an entire card really speaks volumes about the level of structure, organization, and most importantly, depth, within Affliction.

A crisis such as this would not have hampered the UFC’s ability to put on an event; nor would it have likely impacted Strikeforce. Some might say it’s unfair to compare Affliction to the UFC or Strikeforce, but I’d argue that’s precisely the point of absurdity in this entire situation.

The real truth of the matter is that Affliction could not hope to compete with the UFC right out of the gate, and to expect otherwise was to set itself up for a rather large and costly defeat.

And, sure, the idea of what Affliction was trying to do is absolutely marvellous. What MMA fan in their right mind wouldn’t want another organization that is paying huge sums to its fighters, puts on some of the best fights in the world, and supports itself through millions in PPV revenue?

But as they say, Rome wasn’t built in a day.

Affliction should have done things properly right from the outset: going small, going responsible, and going from the ground up, all in order to build a solid foundation.

What would have been wrong with Affliction as a regional promoter – doing four shows a year – in any one of the many underserved MMA markets across the US? It could have easily leveraged its brand into a strong following, sufficient media coverage, and likely a TV deal (HDNet would have been a great full-time partner).

More importantly, as a regional promotion, Affliction would have had the opportunity to gain many of things it proved to lack: operational experience, fiscal accountability, organizational structure, roster depth, and a chance at consistency. In other words, the regional promotion business model would have equipped Affliction with all the tools it would have needed to deal with a crisis such as the one that occurred this week.

Call it what you want – the Strikeforce model, responsible management, whatever – this is the kind of approach and business model that would have produced success. It may not have made money right out of the gate, but it would have been a whole lot easier for the clothing line to subsidize a regional show than the international money glutton that Affliction actually produced. You can also bet that they would have been making money by the 3rd or 4th show; again unlike the model they decided to run with.

Further, the greatest strength of Affliction- aside from the brand itself – was Atencio’s passion and commitment to the sport. Under a better, more well-thought-out business model, you have to figure that it would have only been a matter of years before the correctly modelled promotion began to compete for big name contracts (just as Strikeforce has done).

That’s what Affliction should have been.

EA MMA Says License or No "You still have to deliver"

July 28, 2009

The Sports Business Journal looks at the problems and opportunities of putting out a sports video game without the luxury of having an officially licensed product. While EA Sports is usually on the other end of the spectrum, with a surfeit of licenses, the article notes the unusual situation they are in with their EA MMA title:

EA Sports, a target of many independent game publishers given its dominant position within sports gaming, now ironically finds itself in a somewhat similar situation with the development of its mixed martial arts title, slated for release next year. The company does not have a licensing deal with UFC, the sport’s dominant entity, and is now in a war of words with UFC President Dana White over what White perceives as duplicity in EA’s intentions for MMA gaming, a charge the company strongly denies.

EA is pursuing licensing deals with individual fighters, each of whom risks being blacklisted within UFC.

“IP helps you break through the clutter and rise to the top, but having it is not an excuse for making a bad game. You still have to deliver,” said Peter Moore, EA Sports president.

The article notes Midway’s “Blitz” football game achieving moderate success without the luxury of official status. The EA MMA game will be in a much better position than the other listed non-licensed games, having the marketing heft and industry dominance of the EA brand. In-game promotion and cross-title promotion with other EA titles should be a means of EA leveraging their strong market position to push folks towards their MMA title.

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