UFC introduces economic impact study on behalf of legalization in NY

January 13, 2011

The latest UFC public relations efforts to sway approval for legalized mixed martial arts in New York came at a press conference on Thursday. The UFC introduced an economic impact study which indicated that two UFC events in New York in the first year of regulation would garner the state $23 million dollars.

UFC president Dana White and UFC Chairman and CEO Lorenzo Fertitta reaffirmed its fight for MMA in New York City. The UFC announced that it is committed to two shows in New York upon the legalization of MMA in the state. One of the shows would take place in Madison Square Garden. Another is believed to take place in upstate New York (HSBC Arena in Buffalo)

From the UFC press release:

The study found that holding two UFC events in the state (one at Madison Square Garden and one in Buffalo) will create roughly $16 million in new spending. Additionally, the study found smaller MMA operators will likely hold events that would bring an additional $4 million. In total, $23 million of annual new spending and hundreds of new jobs will be created in the local economy by regulating MMA. Many UFC fans travel from surrounding states, stay for extended periods (at least one night at a hotel), and often arrive hours early for fights, which boosts merchandise and concession sales. New York-based MMA gyms and related industries are also expected to see an increase in revenue from the regulation of the sport. Likewise, local businesses will benefit greatly from MMA bouts, particularly outside of New York City where the economic influx is proportionally greater. This trend follows that of surrounding states which currently regulate MMA fights.

Payout Perspective:

The study makes certain assumptions, but the UFC makes a case based on economics, as to why mixed martial arts should be legalized in New York — it makes economic sense. I found its “trickle down” theory of how MMA would positively affect other revenue streams (e.g., merchandise, local MMA gyms, etc.) as a nice tie in for local New York businesses that may feel the pinch of the current state of the economy. It would be interesting to know how the UFC study determined the annual revenue New York would recieve from “smaller MMA operators” (read Strikeforce, Bellator and other minor league shows) MMA shows. 

We will see this study picked apart by opponents in the coming weeks, but this is an interesting start to what appears to be another campaign to make inroads in the New York market.

8 Responses to “UFC introduces economic impact study on behalf of legalization in NY”

  1. Brain Smasher on January 14th, 2011 12:12 AM

    The 4 million from other MMA shows doesnt seem right. Surely if the UFC brings 16 million in 2 shows at roughly 20K attendance per show. Surely the smallers shows will do much better. I have been to small shows that have done 5K+ in attendance. Granted prices are cheaper but i expect dozens of shows to be ran each year. Every Promotion in the US will want to run in NY. I dont see how 30-50 other events dont equal 1/4 the impact of 2 UFC’s.

  2. Brain Smasher on January 14th, 2011 12:29 AM

    By comparison California lists 75 MMA events on its calendar for 2009. 87 events in 2008.

  3. Steve on January 14th, 2011 7:23 AM

    I think the vast majority of those shows are going to be along the lines of the typical local show that is lucky to draw 1K in attendance and has no TV deal. I would really be interested in knowing what ‘local’ shows you have been to that draw 5K. That certainly is not the norm for most ‘local’ promotions.

    In regards to promoters flocking to NY, I seriously doubt it. There are only a handful of promoters out there with the ability to travel out of their local area (UFC & Strikeforce being the big two), and they are unlikely to hold more than one or two events a year in New York. A Texas based promotion like Shark Fights is not going to suddenly start running shows in New York. Nor is an Oregon based promotion like SportFight, or a California based promotion like Tachi Palace Fights. The real influx of shows is going to be from local NY promoters springing up and New Jersey, Pennsylvania, and Massachusetts promoters crossing the border.

  4. Jason Cruz on January 14th, 2011 8:46 AM

    Steve,

    I agree with you about promoters flocking to NY. There is an expense to doing shows in NY, and a smaller promotion that is operating on a small budget could not risk losing money on a show. I think that promotions from Canada (MFC?) could do well with shows in upstate New York.

  5. Steve on January 14th, 2011 9:54 AM

    I agree about Canadian promoters possibly having success in upstate New York, but I doubt MFC is a likely candidate. They haven’t had much luck running shows outside of Alberta and don’t seem like a good fit to make the 1500-2000 mile trek to New York. I think a Quebec-based promotion is far more likely.

  6. Brain Smasher on January 15th, 2011 1:56 AM

    I have been to a few small shows that drew over 5K. Gracie Fighting Championships in Columbus, Oh. KOTC franchised their name out for a local show with all Amateur fighters and one pro fight and drew in the 3-5K range in Dayton, Oh. Yes most shows will be local shows but many of those people have the same expenses as they would if it was UFC. For example i traveled 3 hours to attend the Gracie event and spent a few days in a hotel. All the expense was the same as it was for the 4 UFC events in Ohio i attended. With the exception the ticket was a little cheaper. I understand most people at local shows dont travel like. But it is still a night out even for the locals which force them to spend money and sparks the economy. When i attend local shows i use fuel, buy food, and spend money at the event. This event also employs many people who in turn make money to spend.

    As for shows flocking to NY. There will be lots. Maybe not large shows but i guarantee M1 quits using NJ so much and uses NY. Others will too. There are to many people and the fan base will only grow there. Also like i said there will be tons of local shows. I dont see how 30-50 shows of any size done relate to more than 4 million.

  7. mmaguru on January 15th, 2011 9:36 AM

    Curious, is the NY market as large as say Vegas, California or potentially Toronto?

  8. BrainSmasher on January 15th, 2011 5:48 PM

    NY commission site claims to over see more than 30 boxing events annually with more promoters recently added. Nevada the in 2010 and 2009 had about 30 and 38 events. So there is not much of a difference between the two in number of events. Im sure Vegas had bigger events though.

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