UFC 129 sets records for attendance, gate and bonuses

April 30, 2011

UFC 129 set an attendance record with 55, 724 in attendance Saturday night in Toronto. The gate totaled $12.1 million ($11.5 million Canadian) according to MMA Junkie.

The records shattered the previous marks of  23,152 (UFC 124) $5,397,300 (UFC 66).

In addition, record bonuses were given to fighters tonight as the Submission, KO and Fight of the Night winners received $129,000 each (in honor of UFC 129 I suppose). A total of $516,000 of bonuses were handed out.

MMA Weekly reports the bonuses as follows:

Fight of the Night:  Mark Hominick vs. Jose Aldo

Submission of the Night: Pablo Garza for his triangle choke of Yves Jabouin.

Knockout of the Night: Lyoto Machida for his crane kick on Randy Couture.

We will have more on the big night in Payout Perspective.

Early start time for UFC 129 scares White

April 30, 2011

Dana White expressed concern over the UFC’s decision to move up the PPV time for the biggest event in the company’s history. The move, announced in March, was done to accommodate the East Coast markets so that audiences would not have to stay up until 1am.

Although a calculated risk White believes it was the right move. Yet, he is not sure that everyone knows that the PPV has moved up one hour.

Via MMA Junkie:

…White is concerned word hasn’t made it throughout the MMA community, which could have a major impact on PPV sales for this weekend’s event. “It’s the most dangerous thing we’ve ever done,” White said. “It’s scary as hell for me.”

Payout Perspective:

While the UFC has blanketed cable television with commercials and its UFC Countdown and UFC Primetime episodes leading up to today’s event, there still may be those accustomed to the 7pm start time. It may have been nice to have started the new time one or two PPVs earlier so fans would get used to the change.  Still, the new time will probably garner more East Coast audiences. As I’ve argued for the west coast, it will be hard to tune into the earlier fights on Facebook and Spike since they are mid-afternoon. But, most people should be able to tune in (or at least DVR) for the PPV tonight. One thing to look at tonight is the ratings for Spike TV’s prelim fights to see if the move up an hour hurts its viewership.

Enjoy the fights!

MMA Elite introduces sports drink

April 29, 2011

MMA Elite rolled out its new sports drink to the masses at the UFC Fan Expo in Toronto on Friday. The fighting and lifestyle brand believed that the sports drink was a “natural progression” for the growth of its brand.

 (Via MMA Elite)

Via press release:

MMA Elite® has secured a licensing deal with Sirius MMA, Inc., a group founded by Bryan Lindsey, a Las Vegas based entrepreneur, and James Akers and the team at Wit Beverage (WBC), to market and distribute a naturally flavored sports drink in North America. Lindsey was first introduced to UBM in February 2010 and has since generated numerous distribution deals with UBM across a broad range of consumer products, for both domestic and international markets.

Lindsey states, “This is an opportunity to bring a naturally flavored sports drink with ‘No High Fructose Corn Syrup’ to a growing worldwide audience and to the professional athletes of the fastest growing sport in the world. Sirius MMA and WBC feels this will be a lucrative deal with a global reach and is proud to be associated with MMA Elite®, the largest MMA lifestyle brand in the world.”

“UBM realized that entering into this product category was a natural progression for the growth of MMA Elite® as a lifestyle brand while remaining solidly intact with its core fan base and the athletes themselves. Considerable time and effort has been put into the drink profile so that MMA Elite® is able to offer a unique alternative to the products currently available”, said Steven Jolna, president, UBM.

Payout Perspective:
As an official partner of the UFC, MMA Elite’s new sports drink will not conflict with Xyience, which is the official energy drink of the UFC. BJ Penn (pictured above) showed up at MMA Elite’s booth today to help promote the sports drink. It will be interesting to see how the new sports drink will be marketed and whether fans will purchase the drink.

Wrestlemania 27 PPV: 1 million buys

April 29, 2011

Variety is reporting that the tentative numbers for the WWE’s annual supershow met expectations with 1 million PPV buys. The buy rate reflects a 30% increase in North America and 15% overseas.

The 1 million buys was helped by the return of The Rock to the WWE roster and the annual celebrity involvement, this time it was Snooki of the Jersey Shore. In 2009, the buy rate neared 1 million with 960K buys and 2010 received a disappointing 885K. 2010’s numbers probably spurred Vince McMahon to make a push for big talent. Hence, the return of The Rock. 

 Via Variety:

WrestleMania is the company’s single biggest moneymaker each year. Last year’s PPV earned $19 million; ticket sales to the Phoenix show chalked up another $5.8 million. But that was down from previous years. In 2008, Orlando’s ‘Mania earned nearly $24 million from PPV buys and another $6 million in ticket sales.

The recession recently caused consumers to reconsider ponying up $50 for WWE’s version of the Super Bowl, or save money by holding viewing parties, causing PPV buys to drop. Fans also complained storylines were weak leading up to the event.

Payout Perspective:

2011 will be an interesting year to see the direction of the WWE. Today, it announced that it has cut its dividend amid weaker financials. It recently changed its name and strategic direction. How much has MMA taken from the WWE’s audience? Is the WWE’s move into other arenas a sign of diversifying for its shareholders? Or, is it for a potential sale to another company (something I contend is unlikely)?

It will be interesting to compare UFC 129’s buy rate with that of Wrestlemania 27.  While many might balk at this comparison, it’s a nice sample of where people are spending their money.

Zuffa sued for “UFC Fan Expo”

April 29, 2011

Toronto-based Hobby Star Marketing has filed an injunction against Zuffa, LLC, citing trademark infringement for the UFC Fan Expo mark used for this weekend’s events at the Direct Energy Center. The lawsuit also names Reed Exhibitions, the convention company running the event.

Hobby Star Marketing is an organizer of Fan Expo Canada. The expo is the largest combined gaming, horror, comic, science fiction and anime event in Canada.

Via Comic Book Resources:

In the federal court statement obtained by CBR News, Hobby Star has filed for trade-mark infringement on the name “Fan Expo” as well as the slogan “The Ultimate Fan Experience” and the web domain www.ufcfanexpo.com. The papers were filed in a Toronto federal court and make no mention of previous UFC events labeled as “Fan Expos” such as a London, England event last summer, nor do they mention anything about the company’s potential plans for a Fan Expo in Las Vegas this summer. This is likely because Hobby Star only have the “Fan Expo” trademark registered within Canada.

The Morningstar News has a statement from Hobby Star Marketing:

“For the past 17 years, Fan Expo Canada has been the only event offering unique experiences and opportunities to interact with icons, industry leaders, and other enthusiastic fans across a variety of genres and modes and we intend to grow dynamically in coming years,” said Aman Gupta, President of Hobby Star Marketing. “We will do everything possible to protect our intellectual property and maintain the integrity of our event and our brand.”

Payout Perspective:

No word on the disposition of the injunction but we can assume that the UFC Fan Expo is not going to be stopped due to this lawsuit. I am not an expert on Canadian trademark law so its not clear what will become of this case. We may assume that Zuffa has filed trademarks worldwide to protect its brand. Not sure right off the bat when Zuffa filed a trademark for “UFC Expo” or “UFCFan Expo”.  As some of the comments from the CBR post indicate, Fan Expo seems quite generic but the claim seems to relate more to the logo.

The underlying fact is that Hobby Star is protecting its brand and trademark. Part of that is defending against all potential threats. Hobby Star is known as a “shrewd player when it comes to defending its brand.” According to CBR, there has been a back and forth in the world of convention organizers which may mean that Hobby Star is making a statement to other entities that it will defend itself regardless of the size of the organization.

We will see if this has any implications on whether the newly announced UFC Fan Expo in Houston will amend its name due to the lawsuit.

Analyzing Dana White’s Recent Video Blog, Interview, & Executive Iceman Promo

April 28, 2011

The promotion for UFC 129 has been in full force over the past couple of weeks, which means tons of interviews and PR work for Zuffa’s staff.  Dana White released his latest Vlog and gave an insightful interview for MMAHeat.com with Karyn Bryant.

 

Payout Perspective:

White’s Vlog was interesting to see in terms of how much his vlogs have changed from the days that he would attack promotions, MMA media, and pretty much let anything go off the top of the head.  Since then, Zuffa pays close attention tot he details now with any sort of media that reaches it’s fanbase and detractors.  In this video, we are presented with a very calm and relaxed Dana who is just strolling around the Zuffa offices playing practical jokes and giving us some insight into how the company works.
Along with interviews and Vlogs, the UFC has also just released a video ” Mr. Liddell: Executive Iceman” that goes along with these vibe they are painting to their audience. You can expect more of these videos from the UFC brass as they try to portray the UFC as a fun and laid-back brand to appeal to the casuals instead of the bloody cage-fighter image painted on to the sport from it’s early days.

We also get to see what White’s reaction was watching the Strikeforce event in San Diego back in April, where he keeps pushing the message that it was a great event and that he is a Strikeforce fan and enjoyed the show.  It was apparent that Dana had a worried look when Daley knocked down Nick Diaz, but was emotional and enthusiastic when Diaz was able to finish off Daley, who had been kicked out of the UFC for sucker-punching Josh Koscheck after their bout.

When Karyn Bryant asks about a UFC Channel, White quickly shy’s away and says that it’s not easy to get your own channel, though brings ups the fact that in a Business Journal article, UFC was the most popular property chosen to have enough content and demand to start one.

TUF 13 Episode 5: 1.5 million viewers

April 28, 2011

MMA Junkie reports that last night’s episode of The Ultimate Fighter on Spike TV a season-best average of 1.5 million viewers. Episode 5 received a 1.3 rating among men 18-49 and a 1.4 among men 18-34.

 Via MMA Junkie:

Wednesday’s episode scored a 1.3 household rating overall and matched the 1.5 million viewers who tuned in for the season debut back in March. They also were up 15 percent from the week prior.

 Payout Perspective:

Perhaps it’s the fight week bump, but TUF tied for its highest ratings this season.  Of course, the 1.5 million debut was disappointing considering the Kimbo Slice-Matt Mitrione season averaged 4.1 million viewers. With the increase in viewership of TUF, we shall see if the ratings positively affected the ratings for UFC Primetime on ESPN2 and Spike TV last night.

CNBC’s “Fistful Of Dollars” Features the UFC

April 28, 2011

Darren Rovell of CNBC interviewed Lorenzo Fertitta on the “Fistful of Dollars” segment that featured the UFC growing from a 2 million dollar purchase to a 1 billion dollar brand. The segment also touched on the Bud Light sponsorship, UFC 129 success, and when they plan to cash out and sell.

 

Payout Perspective:

The interview touched on some very key points, but points nonetheless that we have heard before and that the UFC believes are important to stress to the public and their fanbase.  Here are some of the highlights from the segment:

– In 2001, Frank and Lorenzo Fertitta along with their training parter Dana White bought the UFC for 2 million dollars, have since turned it to a billion dollar brand.

– Points out that 53,000 tickets were sold to their “129th” event in a matter of hours.

– Lorenzo is expecting UFC 129: GSP vs Shields to sell “lots of PPV’s”.

– Lorenza said they are starting to weave on to the mainstream but they have a long way to go and grow domestically and international.

– They claim Lorenzo and Frank own 45% of the UFC each, and White owns 10% …  but we know that isn’t the case after the Abu Dhabi based Flash Entertainment purchased a 10% stake of the company, dropping Lorenzo and Frank to 40.5% of the company each and Dana White to 9%.

– Estimated that the UFC sold around 9 million PPV’s in 2010.

– UFC key sponsors listed in the interview were: Anheuser-Busch, U.S. Armed Services & Burger King.

– Average ticket price for a UFC event is $276, tickets usually priced between $50-$1,000.

– Anheuser-Busch resigning with the UFC shows how valuable the 18-34 male demographic is to them, will make the UFC a significant part of their sponsorship efforts.

– When Lorenzo was asked about any plans to cash-out on the UFC, he stated that he and his partners feel there is a ton more to accomplish in the sport still.

– They highlight that the first UFC Gym opened in 2009, they have a total of 3 at the moment. They also sell branded gym equipment.

– For Ancillary Revenue, they list Gyms, DVD’s, Video Games, and Collectibles.

– The UFC is in 147 countries/territories, 500 million homes worldwide, not including current deals they are working on in China, India, and other big markets.

UFC Central debuts for 129

April 27, 2011

The UFC announced the debut of “UFC Central” on UFC.tv for this Saturday at UFC 129. The UFC is encouraging fans to purchase the PPV online and experience the UFC’s comprehensive coverage.

Via UFC press release:

UFC Central, which begins at 8 p.m. ET/5 p.m. PT, will feature pre-fight analysis and be available for free during the first hour onUFC.TV. Once the UFC 129 live broadcast begins at 9 p.m. ET/6 p.m. PT, UFC Central will only be available to fans that purchased the event for viewing on UFC.TV and will capture interviews with fighters on the fight card during the live broadcast as well as other analyst commentary.

UFC Central will be offered as a seventh video feed and fifth audio feed, leveraging UFC.TV‘s multi-camera view and multi-audio feed experience. During the live event, fans will have the option inside of UFC.TV to select UFC Central as the main broadcast; or, drag and drop it into Picture-n-Picture or Quad View so that UFC Central can be watched and/or listened to alongside the broadcast of the main fight card.

Immediately following the live broadcast, UFC Central will be offered for free at UFC.TV with post-fight analysis, making it the ultimate destination for the most comprehensive UFC 129 news.

Payout Perspective:

Whether you like it or not, you will eventually tap to the internet. At least that is the hope of the UFC as it pushes viewers to get used to watching its product on the internet. UFC.tv has been playing a free fight a day for several days to get fans to check out UFC.tv. Not only are the fights hyping the 129 card, it also familiarizes users to the web site.  If there are no bugs with the technology, this could be a novel viewing experience for UFC fans as they get pre-fight analysis, backstage reporting and post-fight reaction.

The possible theory of why the UFC is pushing UFC.tv is to wean fans of off TV PPV with the eventual hope that the UFC cuts out the middleman by having viewers pay the UFC directly for its fights. The only problem with this is that it is negates having viewing parties and watching at bars. It is hard to fathom having 10 buddies gathering around a computer to watch fights.

Should there be a fighter’s union?

April 27, 2011

In a recent interview with ESPN, Randy Couture voiced his concern for fighters to receive health benefits. These comments raised the issue of whether there is a need for a fighter’s union. While Couture is against a union, he endorsed the need for fighters to receive some type of medical coverage.

Via ESPN:

Couture isn’t interested in spearheading a war for fighters’ rights, but he said there are issues that absolutely need to be addressed. His hope is that Zuffa and the fighters will come together with open minds before a war is the only option left.

Couture points out health insurance when not competing and the need for a pension as two issues he would like to see addressed to take care of fighters. However, Couture does not think unions are always beneficial. He points to the recent NFL labor issues as an example.

The Score disagrees with Couture’s comments:

The disagreement I have with Couture is that he believes that, without any leverage, Dana White and Lorenzo Fertitta will bow to the fighters command and do this. Why would Zuffa invest millions of dollars into fighter safety away from the cage when there is no pressing need to do so? The last line of Couture’s interview says it perfectly “There’s got to be a way to come together and meet on ground that everyone can live with.” This is why Unions exist, so that two parties can come together, on equal footing, and negotiate a common ground.

Whether it’s Couture’s political ideology or the fact that his retirement is imminent and needs to be in the good graces of hte UFC so he can receive a Chuck Liddell-like position in the UFC, Couture believes that Zuffa and fighters would come together to address concerns. While I do not believe there will be a Norma Rae moment in the UFC or Strikeforce, it begs the question of the need for insurance coverage for fighters. Its not clear whether Couture actually thinks that Zuffa and fighters would actually sit down and talk about these issues…let alone think that the discussion would be amicable. Bear in mind, Couture and Zuffa have been involved in litigation. Perhaps Couture is painting a rosy picture on this issue as he fades into retirement.

While there is speculation that some fighters are covered by Zuffa in their contracts, others are not. For an up and coming fighter at the bottom rung of the card, it would be hard to request in their contract a clause for insurance. The fighter market is so competitive that if a fighter is injured, its easy to find someone to replace the injured fighter. There have been instances of fighters going into fights with known injuries but doing it because they need the money to feed their family.

There are distressing stories out there about fighters not being covered by insurance. Former TUF welterweight winner Joe Stevenson had to go to Mexico for x-rays due to the fact that he could not afford it in the U.S. This was after Stevenson had won the six-figure contract as the TUF winner. Then there is the gruesome injury (don’t click on the link if you have a weak stomach) suffered by Corey Hill in 2008. Dana White indicated that the UFC paid for Hill’s medical treatment and rehabilitation. Even though Hill’s medical bills were paid, Hill still had financial problems. Obviously breaking a leg when your profession is being a fighter hurts you financially. One may argue that the individual should be held accountable for their financial fate. But, most fighters give up other careers to focus on their dream of fighting in the Octagon.

For the UFC’s part, it has conducted seminars for its athletes to educate them on the need for coverage. If nothing else, this can provide the necessary information on what is and what is not covered in terms of health insurance coverage. Then, it would be up to the individual fighter to determine whether to purchase insurance.

With no health or disability insurance offered by Zuffa, fighters are left to make the decision on whether to purchase it themselves or roll the dice and hope that they are not seriously injured. Certainly, insurance premiums would be high considering the nature of the work.

Although it would be prudent for an agent or manager to persuade their fighter to purchase insurance, it would be up to the fighter. With all the other expenses in training for a fight, paying for insurance might seem excessive at the time.

Zuffa could provide some sort of fund that would pay for health and/or long-term disability coverage for fighters suffering injuries while under contract with the UFC. But, a foreseeable result of something like this would be lowering fight purses and fight bonuses. Essentially, if money is taken from Zuffa, it would likely find another area to recoup the money.

Moreover, this could lead to the potential for lawsuits if a fighter is denied coverage.Then there is the logistic question of which fighters are covered and if there should be a threshhold of fights an individual must compete in to be covered.

During a web chat in leading up to UFC Fight Night in Seattle Dana White was asked about whether fighters should unionize, Dana White responded that it was up to the fighters. Despite being a neutral answer during the web chat, it’s probable that he would oppose fighter’s unionizing. In fact, he would probably hold a personal vendetta against those attempting to unionize. If you thought denying a media credential was bad, think of what Zuffa would do to fighters attempting to create a union.

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