SBJ: Fight Issue, June 14th
May 25, 2010
Street & Smith’s Sports Business Journal has announced it will be producing a special in-depth issue on the fight business that will be released on Monday, June 14th.
I’ll have coverage of some of the articles here, but I encourage everyone to check them out and pick up a subscription; very much worth the money!
UFC 113: 520,000 Buys (Early Reports)
May 24, 2010
Dave Meltzer of the Wrestling Observer reported last week that he’s getting early reports of 520,000 buys for UFC 113, but that he’s also seeing numbers which could point towards a number even higher.
Early reports on UFC 113 on 5/8 in Montreal have the show doing 520,000 buys, slightly above the 450,000 that the first Lyoto Machida vs. Mauricio “Shogun” Rua fight did. We should note that there were cable reports as high as 687,000 for the show, and trending patterns were only slightly behind GSP vs. Dan Hardy and the highest besides that show since August, which would also indicate something closer to the latter than the former. There are a lot of other measures that also indicate the higher number, but as far as the number of buys from people who would have the numbers and that can be confirmed, the lower number is the best number we’ve got.
Payout Perspective:
The website issues that have plagued MMAPayout.com in the last few weeks prevented me from devoting any time towards putting together a PPV prediction for UFC 113, but the gate and countdown data pointed to 491k (I believe my personal guess was 550k in the comments section of a related post). It was always a pretty good bet that the bout would do over 500k, even if Machida nor Rua were genuine stars, considering that it was a rematch of a highly controversial fight, featured a co-main war of words, and also had Kimbo Slice.
Here’s where things get interesting. I’ve been harping on how PPV buyrates go in cycles and that we were coming up on a big cycle in March. If UFC 114 performs as we all expect it will, the string of events from UFC 111-114 will be the first four-event string in UFC history to sell more than 500k at each event. It won’t be the most lucrative series in UFC history (that still belongs to UFC 97-UFC 101), but it’s still a feather in the UFC’s cap, especially in light of all the people that said the UFC had peaked.
I don’t expect the UFC will make it five in a row with UFC 115, but the UFC is rolling out the movie theaters for the event which suggests they’re looking to give 115 a little extra support (fight week promotion could push that event over the top). However, if the UFC can push 115 above the 500k mark, it should be good to establish a record string of events with 116, 117, and 118 this summer (Lesnar-Carwin, Silva-Sonnen, Edgar-Penn/Couture-Toney).
In fact, the way things are shaping up right now, the UFC could end up beating its mark for PPV buys from last year – something that’s pretty impressive considering they had a very bad start to the year.
AKA Licensing Program
May 24, 2010
American Kickboxing Academy has announced that it will officially begin its licensing program at this weekend’s UFC Expo that coincides with UFC 114 in Las Vegas, Nevada.
The American Kickboxing Academy® is going to present opportunities to license its federally registered trademark at the UFC® Fan Expo™ on May 28-29 at the Mandalay Bay Convention Center in Las Vegas, Nevada. Several American Kickboxing Academy® team members will make appearances at AKA™’s booth, including undefeated heavyweight sensation Cain Velasquez, welterweight number one contender Josh Koscheck, and fan favorites Jon Fitch and Mike Swick. Fans will have the opportunity to purchase AKA™ apparel and collect autographs, as well as to win autographed items through contests. Clients interested in licensing opportunities will have the chance to discuss ways to partner with AKA™, including affiliated training facilities and product licensing.
Payout Perspective:
I can’t help but feel as though we’re finally starting to see a bit of a business evolution within the mixed martial arts industry. Some of these companies have realized that they have valuable properties with significant exploitable potential; and, as a result, they’re now moving to license or sell those properties to earn extra revenue. We saw it first with the UFC’s merchandising and collectibles initiatives – and many would argue that they took too long to do that – and now we’re seeing brands like Tapout and AKA explore more opportunities than what are just immediately in front of them.
UFC 114 Fight Week
May 24, 2010
In the past few years, marketing during fight week has proven extremely valuable in motivating consumers to purchase a PPV event. Thus, I suspect the UFC will pull out all of the stops this week to promote UFC 114, because this event could wind up pushing 800k – which is remarkable for a non-title bout – and really help continue the UFC’s fight interest momentum towards UFC 116.
What does the UFC have in store this week?
UFC Undisputed 2010
The biggest news-generator is likely to be the release of THQ’s UFC Undisputed 2010 on Tuesday, May 25th for the Xbox 360 and PS3 platforms. The game sold 3.5 million copies last year and promises to sell very well this year once again. If you consider that the average gamer is right in the UFC’s demographic wheelhouse, and then take into account that these gaming websites have the ability to reach millions of gamers, the UFC will be getting a ton of pop on fight week from fans reading and watching reviews/videos of the game (and talking about it) on these websites.
UFC Primetime: Rashad vs. Rampage
The final episode in the third UFC Primetime series will air on Wednesday following the broadcast of TUF 11. The fact that an average of 1+ million have watched both of the shows thus far is something that bodes well for UFC 114.
MMA Live & ESPN Coverage
The UFC will also feature heavily on ESPN2′s MMA Live segment this Thursday night (May 27th), but due to other programming commitments will only air a post-fight show for UFC 114 (as opposed to the pre- and post-fight shows it did on ESPN2 for UFC 113). I also wouldn’t be surprised to see Rashad and Rampage doing interviews on ESPN Sportscenter this week.
As I’ve said before, it’s my expectation that ESPN will renew this show for at least another month to see how it will fare with UFC 116. Plus, you have to consider that the ratings for MMA Live on ESPN2 (~130,000 viewers) are slightly above what the network normally gets in that time slot.
However, the question for ESPN remains the same, is a gain in one demographic worth a loss in another? The ratings being slightly higher might not be enough to entice ESPN to continue with the program long-term (then again, I take a bit of an issue with the notion that it’s one or the other – we’ve never seen any hard evidence that these networks are hemorrhaging loyal viewers simply on account of MMA).
UFC Fight Week Promo
The UFC will also continue with its usual array of DW blogs, press conferences, and weigh-ins; all of which will give Rashad and Rampage a chance to spit even more venom than before. If last week’s media conference was any indication, there’s still no love lost, and the fans will likely eat it up.
Next UFC Expo in August @ UFC 118
May 21, 2010
The Staff at MMAJunkie are reporting that the UFC will host a UFC Expo in August to coincide with its first event in Boston, Massachusetts (UFC 118) on August 27th and 28th.
The promotion today announced a third date for the highly popular event to coincide with UFC 118 in Boston. The expo takes place Aug. 27 and Aug. 28 at the Hynes Convention Center, a short trip from TD Garden, which hosts the pay-per-view event.
Payout Perspective:
These events are quite interactive and a great place to connect with the MMA audience. In moving these exhibitions around, the UFC can help keep the event fresh in many different markets, incentivize more people to make a weekend trip (to see the expo and the fight), and to help cultivate a deeper relationship with fans.
I’ve heard rumblings that next week’s expo hasn’t draw as much preliminary interest as last year’s event. While that could still change, it sort of places even more importance on moving the show around. There are a host of great markets that would be very receptive to an expo (as mentioned in the Junkie article) and there’s no reason just to make this a Vegas event.
Rashad vs. Rampage, Episode 2: 875,000 Viewers
May 20, 2010
MMAPayout.com has learned that episode two of UFC Primetime: Rashad vs. Rampage generated 875,000 viewers, which is the fourth best rating in the now eight episodes of the series.
Payout Perspective:
The UFC has to be happy with these ratings – the exposure for the Rashad vs. Rampage fight is definitely going to help the sell. However, while an aggregate of over 2 million in two episodes is far and away better than the other shows have been able to do, neither of the other two Primetime series had the benefit of a lead-in from a TUF program. It’s good scheduling, but it’s also not hard to keep a large percentage of one million MMA fans when you’re following a program with fresh programming.
It makes sense that these numbers dipped by close to 25% from the first episode considering that TUF 11 lost 23% from last week to this week in its own viewing. That would suggest a conversion rate from TUF to Primetime of about 67%.
TUF 11, Episode 8: 1.0 HH Rating
May 20, 2010
MMAPayout.com has learned that the eighth episode of The Ultimate Fighter season 11 earned a 1.0HH rating on the basis of 1.3 million viewers on Wednesday night. The show earned a 1.54 in the M18-34 and a 1.2 in the M18-49.
Quarterly hours: .91, .92, 1.05, 1.02
Payout Perspective:
This was the 1.0 drop that I had anticipated coming a little earlier in the season; it’ll be interesting to see if the ratings bounce back. However, even if the show draws a 1.0 in the next three straight episodes it’ll still end up in the top-five TUF seasons in terms of HH rating averages.
UFC to Make Major Announcement in Toronto
May 20, 2010
The Canadian Press are reporting that the UFC will make a major announcement at Toronto’s Rogers Centre next Tuesday, but it’s unlikely that the news will pertain to legalization in Ontario.
The Ultimate Fighting Championship is set to hold a press conference next Tuesday at Rogers Centre in Toronto, where the Las Vegas-based mixed martial arts organization says it will make a “major announcement.”
UFC president Dana White and chairman and CEO Lorenzo Fertitta will be in attendance at the event, which was announced Thursday and will include a media Q&A.
Payout Perspective:
You never know what you’re going to get with the UFC’s “major” announcements; I sometimes think the boys get a little excited – understandably – about the deals they’re working on and schedule an announcement before everything is signed and sealed.
With that said, I’m inclined to believe that they might finally announce the opening of an office in Canada or a Canadian version of TUF. Those are things that have been openly bandied about in the past; and if it’s not an announcement related to legalization, what else could it be?
Rampage-Rashad Feud Gone Too Far?
May 20, 2010
Damon Martin of MMAWeekly helps to transcribe part of this week’s UFC 114 media conference call with Rashad Evans and Rampage Jackson that, at several points, became quite heated. Martin then poses the following question:
When does trash talk become political talk become social commentary become hate speech? Were Evans and Jackson over the line with the way they went after each other in a public forum?
That’s a question that’s left to be answered by the public, but it would seem that the side show has diluted a great fight into a hate filled, anger ridden, controversy between two fighters who obviously do not like one another.
Payout Perspective:
Sports are a reflection of society – a reflection that can closely mirror many of the challenges that we all face in our daily lives and provide a platform for us to meet and address those challenges.
Thus, I have no issue with Rampage and Rashad’s escalating war of words. This feud, in many ways, embodies the real life tensions that our world faces today: issues of race, socio-demographics, sexual orientation, and sportsmanship (or lack thereof). These are not things to hide from, nor should they be eschewed to some dark corner of the sports world.
This is a fight sport, but it’s more than just a battle inside the cage – it’s an expression and embodiment of the issues above. Better to have those issues out in the open and this conflict channeled properly than to have it fester beneath the surface and explored in a less controlled environment.
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Regardless of what you think about the feud, it’s tough to deny that this will be a boon for UFC business. This fight will sell like gangbusters – impressive considering it’s not a title fight – and the winner of this fight walks away with a new level of popularity that he can take into his title shot to make that a massive event as well.
Lindland on Unions in MMA
May 19, 2010
Zach Arnold of Fightopinion has transcribed a recent interview done with Matt Lindland where he talks about why he thinks the probability of a fighter union forming is pretty low.
“At least in basketball or baseball or football if you don’t like [the politics], you go to another team. If you have a players union and in this sport if you don’t like what’s going on, what’s the other team? You know, essentially you’re relegated to what is considered by the fans as the minor leagues just because you didn’t get along with the management at the time of the one team. So, it’s a completely different industry and it’s not regulated well, you can’t just go to another team, so it’s a lot different you know different stuff about just the business side of the sport.”
“Unless you can get the top athletes and you’re not going to do that. I mean the fighters, they’re all whores, they just fight for the biggest purse and it’s going to be tough unless you could somehow get all the fighters to agree to something like that and you know there’s always somebody going to come up underneath who’s not willing to do it. Like I said, it doesn’t matter who the best guys are, it only matters what the announcers are telling you who the best guys are and the fans are going to believe it.”
“There’s enough support (for a union) but these guys, outside of the cage or outside of the ropes, these guys are cowards, you know they would not dare stand up to the powers-that-be.”
“You only have a finite amount (of years) that you can compete and you want to make as much money as you can in that time and you don’t want to mess around with the politics of the sport.”
Payout Perspective:
I’ve always been of the opinion that the fighters lack the requisite solidarity to join together and unionize. Lindland is exactly right in pointing out that every fighter is out for himself; careers are exceptionally short in this business and guys have to make all the money they can, while they can. However, it’s tough to blame anyone for wanting to avoid the politics. I’m not sure that ‘whore’ is accurate.
The only way I see a fighter union forming is if the Muhammad Ali Boxing Reform Act or some variant is applied to MMA that materially jeopardizes the UFC’s current business model. For example, an act that limits the UFC’s ability to retain fighters for more than a year, denies them access to promotional rights, or prohibits automatic contract renewals like champions clauses. Then it might actually be in the best interest of the UFC to help galvanize the fighters in order to negotiate a collective bargaining agreement; one that might allow the organization to retain league-type business model.
I’ll caution that this is all wild speculation. The Ali Act isn’t likely to be enforced, nor is there any inkling that something similar is coming down the legislative pipeline – lawmakers in the US have enough to worry about.
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In the interview, I found it interesting that Lindland chastised the power of UFC television announcers like Joe Rogan to shape the views and opinions of fans when that was so clearly the intent of his documentary entitled Fighting Politics: The Story of Matt Lindland. The film managed to gather just about every known UFC enemy of state – sometimes with footage that was at least 3-4 years old – and tell the story of Lindland’s fall-out with the UFC from his perspective.
However, as with all things, the truth is probably somewhere in the middle.
Was the film hypocritcal? Sure, but perhaps hypocritical was the point. I’m not really sure how much credit to give Lindland, but it’s conceivable his intent was to be overly facetious and prove the point that just because something is said on camera, doesn’t mean that it’s true.
