Will PBC turn strategy into media rights deal?

April 24, 2017

Sports Business Journal (subscription recommended) reports on the current status of Premier Boxing Champions and its strategy of time buys across a broad landscape of networks.  The article looks at the ratings over the court of the innovative and risky experiment.

The hope was to turn the time buys into a lucrative “rights fees” deal.  This has not happened thus far.  Instead, the strategy has seemed to spread the brand thin and ratings have been sporadic.  Recently, Spike TV decided not to pick up its option for PBC stating that it would focus more on Bellator.

Per the article, there is still an opportunity for a rights fees deal but with the UFC shopping its rights package, there is some competition.  CBS might be a potential landing spot for PBC since it already has a tie-in with Showtime and has a $40 million budget for 2017.  In addition, there is the underutilized CBS Sports Network which could use additional live content.  In leadup to the last couple of PBC fights on CBS or Showtime, CBS Sports Network has shown previous fights of boxers that have upcoming fights on the networks which has served as good shoulder programming marketing the fighters.

One of the concerns for PBC is the lack of sponsors to spend consistently in the sport.  Showtime executive vice president and general manager of sports Stephen Espinoza notes that sponsors is where boxing is “living or dying.”  He believes there needs to be more education of sponsors to show that it has a valuable demo to deliver.

PBC has produced 54 cards in the last 12 months that aired across nine channels.  The highest average it has produced was 2.75 million viewers on CBS for two shows.  Its most-viewed show was a Sunday afternoon fight on NBC in August between Errol Spence-Leonard Bundu which aired immediately after the men’s basketball gold medal game.  The fight drew over 4.8 million viewers with a peak of 6.34 million.  More recently, last month’s Keith Thurman-Danny Garcia fight drew an average of 3.1 million viewers with the fight drawing 3.74 million and peaking at 5.1 million.  In February, the return of Adrien Broner on Showtime drew 779,000 of its network subscribers.

Payout Perspective:

The article notes that PBC is at a crossroads in its business model.  Based on the TV ratings, the time buy strategy has not been effective.  Despite the fact, the strategy has not produced desired results the article notes the last couple of events for PBC have produced good ratings highlighted by Keith Thurman-Danny Garcia on CBS.  We should see some decent ratings for Thurman-Andre Berto on Showtime this past Saturday.  Will PBC survive past 2017?  Better events, promoting its top fighters and maintaining a focused network strategy should help a turn around.  Of course, the networks and sponsors which would infuse PBC with an injection of money would help a business that has seeped money since the beginning.

UFC Fight Night 108 attendance, gate and bonuses

April 23, 2017

UFC officials announced the attendance, gate and bonuses from UFC Fight Night 108 from Nashville, Tennessee.  The event drew the second-highest attendance and gate in events in Nashville.

UFC Fight Night 108 drew 10,144 fans for a gate of $755,180.  The event took place at the Bridgestone Arena in Nashville.  The multi-purpose venue varies in maximum capacity from 17,000-20,000 depending on the event.

The $50,000 bonuses handed out for UFC Fight Night 108 went to Cub Swanson, Artem Lobov, Mike Perry and Brandon Moreno.  The main event of Swanson-Lobov drew the Fight of the Night while Perry and Moreno earned Performance of the Night bonuses.

It was the second-highest attendance of the four UFC events held in Nashville but the largest grossing of the four.  The last time an event was held in Nashville prior to Saturday night was UFC Fight Night 73 in April 2015.

The attendance is on par with other Fight Nights and was helped by having local UFC fighters on the card.

Mir handed 2-year suspension for USADA violation

April 22, 2017

USADA issued an official 2 year sanction to former UFC heavyweight champion Frank Mir stemming from multiple positive tests for a prohibited substance.  The tests came from an in-competition test on March 20, 2016 at UFC Fight Night 85 in Brisbane, Australia.

The 38 year tested positive for a long-term metabolite of dehydrochloromethyltestosterone (DHCMT).  It is also known as oral turinabol.  It is a non-Specified Substance in the class of Anabolic Agents and prohibited at all times under the UFC Anti-Doping Policy.  He was provisionally suspended on April 8, 2016.

Via USADA release:

Upon learning of the positive results of the sample analyzed in Tokyo, USADA had all previously collected stored samples for Mir reanalyzed at the WADA-accredited laboratory in Salt Lake City, Utah (SMRTL), which had also recently implemented methodology for the detection of newly identified long-term DHCMT metabolites. As a result of the additional analyses, SMRTL discovered that an out-of-competition sample Mir provided on February 5, 2016, which had previously been reported to USADA as negative for the presence of prohibited substances, was also positive for the same long-term DHCMT metabolite found in Mir’s in-competition sample.

Mir had claimed that the positive result may have come from Kangaroo meat which he ate prior to his fight.

Payout Perspective:

The results likely bring an end to Mir’s career in the UFC.  It also reflects the need for fighters to be vigilant of what goes in their bodies.  Mir does not recall what he may have eaten abroad and does not know if USADA would truly travel to Australia even if he were to list each meat.  Regardless, the finding without any defense or mitigating circumstances meant that Mir will be assessed the 2-year sanction.

Alliance MMA retains law firm to defend itself against investor lawsuit

April 21, 2017

Alliance MMA has announced that it has retained the law firm of King & Spalding to defend the company against a lawsuit filed against it on Monday.  The announcement was made via company press release.

Via Alliance MMA press release:

NEW YORK, NY – April 21, 2017Alliance MMA, Inc. (“Alliance MMA” or the “Company”) (NASDAQ: AMMA), a professional mixed martial arts (MMA) company, announced today that a shareholder has filed a lawsuit against the Company and two of its current officers in the United States District Court for the District of New Jersey, under the caption Shapiro v. Alliance MMA, Inc., No. 1:17-cv-2583 (D.N.J.). The lawsuit alleges violations of the federal securities laws and purports to seek damages on behalf of a class of all shareholders who purchased the Company’s common stock pursuant or traceable to the Company’s initial public offering. The Company believes that the lawsuit is without merit and intends to vigorously defend against it.  “Securities claims like this are often pursued by opportunistic lawyers when there is a drop in stock price,” stated CEO Paul K. Danner, III.  “The law firm of King & Spalding LLP has been engaged to help us fight back, and we plan to file a motion to dismiss this lawsuit.”

 Danner provided a comment to MMA Payout on the lawsuit earlier this week.

Below is a copy of the lawsuit.

Alliance MMA lawsuit by JASONCRUZ206 on Scribd

Payout Perspective:

Rarely do we get the legal strategy of a party but it’s clear that Alliance MMA believes there is no merit in this lawsuit and will seek a dismissal.  The company believes that attorneys are driving the lawsuit.  There are law firms out there that do seek out companies where there is a drop in stock price or issues in financial reporting.  Notably, Alliance MMA traded at a 52 week low earlier this week after the lawsuit was announced.  The lawsuit occurred after an 8-K was issued prior to its annual 10-K report.  MMA Payout will keep you updated.

TUF 25 Episode 1 draws lowest-ever rating for series

April 21, 2017

The Ultimate Fighter 25 debut on FS1 drew 288,000 viewers per ShowBuzz Daily.  The rating is the lowest-ever for the TUF franchise.  T.J. Dillashaw and Cody Garbrandt serve as the coaches this season.

Prior to Wednesday night’s episode, the lowest-rated debut was last season’s TUF 24 which posted 370,000 viewers.

The two-hour premiere aired on FS1 on Wednesday.

Payout Perspective:

I am actually interested in this season but the ratings continue the downward trajectory of the TUF Franchise.  A couple seasons back, FS1 execs noted that TUF should be seen as more of a DVR-viewed show rather than a live event.  Still, the ratings show a decline.  With WME-IMG cutting costs the company will need to weigh the benefit of TUF’s use versus the expense it takes to produce the show.  FS1 does need content for its network so there is some need for it but could the ratings make execs reconsider.

South Korean authorities investigate potential “fight fixing”

April 21, 2017

South Korean officials are investigating a potential fight fixing issue from UFC Fight Night 79 from November 2015.  Fighters Tae Hyun Bang and Leo Kunts were warned by UFC official before their fight on the night per MMA Junkie.

Bang is reportedly under police investigation for allegedly taking a bribe.  One South Korean news outlet reported that Bang took $2 billion Korean won (approximately $1.7 million U.S. dollars) if Kuntz would prevail.  Another report suggests Bang accepted a bribe of $100 million won (approximately $87,000) while wagering $50 million (approximately $43,000) on his opponent.

Bang went from a slight favorite to a massive underdog in betting lines prior to the fight.  The swing in odds may have been the reason that tipped UFC officials to confront both fighters.

Bang defeated Kuntz by split decision.

There have been several other instances in other sports in South Korea where match fixing has been a concern.  In 2016, South Korean police charged 21 people including two professional baseball pitchers in the KBO League on suspicion of match fixing.  In recent years, the authorities have investigated professional soccer, baseball and volleyball players on suspicion of manipulating game outcomes in return for bribes.

Kuntz stated that he did not know what was going on although he confirmed that the UFC talked to him prior to the fight.  He also did not think that Bang tried to lose per comments made to MMA Fighting.

Payout Perspective:

This is the first formal investigation into fight fixing in the UFC.  The issue is a concern for the company considering that the sport always discusses gambling lines.  It’s not the big fights to be concerned with but the lower-tier matchups because those are the one where a fighter does not make as much and there is less scrutiny unless there is a wide swing in betting lines.   Match fixing is an issue in South Korea but the concern also arose at UFC 193 where a betting ban was imposed over concerns with “integrity issues.”

Updated ratings for Bellator 177 and Bellator Kickboxing

April 21, 2017

An update from last Friday’s Bellator 177 has the event peaking at 859,000 viewers per Nielsen.  In addition Bellator Kickboxing last Friday peaked at 452,099 viewers on Spike TV.

Bellator 177’s viewership drew 595,000 viewers in DVR+3 ratings.  Bellator drew 577,000 viewers in overnight plus same day ratings.  Kickboxing’s adjusted viewership increased to 321,000 viewers.  It drew 295,000 viewers and 118,000 in the A18-49 demo per Sports TV Ratings.

Conor McGregor named to Time’s list of “100 Most Influential People”

April 20, 2017

Conor McGregor has made Time magazine’s of 100 “Most Influential People” in the world.  Arnold Schwarzenegger wrote the profile for Time.

The former Governor of California’s writeup on Conor is here.

Previously, Time Magazine picked Ronda Rousey on a list of those “30 People Under 30 Changing the World.”

Payout Perspective:

McGregor’s brazen interviews and outlandish lifestyle coupled with his success in the Octagon has made him one of the top names in combat sports and someone that people not following the sport knows.  He has single-handedly talked himself into a potential fight with Floyd Mayweather, Jr.  Moreover, he’s talked himself into possibly one of the biggest paydays in combat sports.

UFC on Fox 24 drew 1,996,000; Prelims draw 1,105,000

April 20, 2017

UFC on Fox 24 drew 1,996,000 viewers on Fox Saturday afternoon in adjusted ratings to account for the overrun per Nielsen. The UFC Prelims drew 1,105,000 on Fox.

The main card peaked during the main event portion of the telecast with 2,874,000 viewers from 10-10:15pm ET.

UFC on Fox Ratings
Overnights Live + SD
UFC on Fox 1 5,700,000
UFC on Fox 2 4,570,000
UFC on Fox 3 2,250,000 2,400,000
UFC on Fox 4 2,360,000 2,400,000
UFC on Fox 5 3,410,000 4,400,000
UFC on Fox 6 3,770,000 4,220,000
UFC on Fox 7 3,300,000 3,700,000
UFC on Fox 8 2,040,000 2,380,000
UFC on Fox 9 2,410,000 2,800,000
UFC on Fox 10 2,550,000 3,220,000
UFC on Fox 11 1,990,000 2,500,000
UFC on Fox 12 2,020,000 2,500,000
UFC on Fox 13 2,270,000 2,800,000
UFC on Fox 14 2,820,000 3,049,000
UFC on Fox 15 2,430,000 2,745,000
UFC on Fox 16 2,290,000 2,800,000
UFC on Fox 17 2,280,000 2,781,000
UFC on Fox 18 2,430,000 2,685,000
UFC on Fox 19 2,130,000 2,500,000
UFC on Fox 20 2,440,000 2,975,000
UFC on Fox 21 2,200,000 1,983,000
UFC on Fox 22 2,690,000 3,178,000
UFC on Fox 23 2,020,000 2,189,000
UFC on Fox 24 1,740,000 1,996,000

In addition, the prelims drew 1,105,000 viewers.  The event aired on Fox and preceded the main card.

UFC on Fox 23 Prelims: 619,000 on FS1

UFC on Fox 22 Prelims: 679,000 on FS1

UFC on Fox 21 Prelims: 1,122,000 on Fox

UFC on Fox 20 Prelims: 1,261,000 on Fox

UFC on Fox 19 Prelims: 1,400,000 on Fox

UFC on Fox 18 Prelims: 702,000 on FS1

Payout Perspective:

The prelims were two hours and was the lowest rated in the history of the prelims on Fox.  The UFC on Fox 24 rating is the second lowest-rated ever in Fox history.  As pointed out by one of our readers, UFC on Fox 21 was slightly lower.

Formerly WSOF, Professional Fighters League announces new structure for fighters

April 19, 2017

The World Series of Fighting is being repackaged as the Professional Fighters League.  The league will begin in January 2018 according to a press release sent out on Wednesday.

The inaugural season will run for 10 months and will feature seven different weight classes.  Similar to league play, fighters will compete in three regular season fights with the best records moving to a playoff and then a championship round.  There will be $10 million in prize money with $1 million going to each winner of the 7 divisions.  The remaining 3 divisions will go to regular season and playoff competitors.

The Washington Post have announced that a group led by several D.C.-area businessman are spearheading the re-launch effort.  Russ Ramsey, an investment banker and hedge fund manager along with venture capitalists Donn Davis and Mark Leschly are the co-founders of the Professional Fighters League.  Sports franchise owner Ted Leonsis is also an investor.  Leonsis owns the Washington Capitals, Mystics and Wizards.  Also, members of the Lerner family who own the Washington Nationals are investors.

There is no current television deal as the NBCSN TV deal expires at the end of 2017 although according to MMA Fighting, talks are underway with several media outlets.  MMA Fighting obtained an email to fighters from Ray Sefo stating the change.  It also noted that every fighter will have regular fights (no less than 3 per year), they will receive a monthly paycheck and have the opportunity to be champion.

Payout Perspective:

The announcement was a surprise for fighters as none knew of the details of the new venture.  Of course, there are still more questions to ask.  First, are the fighters now employers?  Second, with the mandate that every fighter have at least three fights, how many former WSOF fighters be included on its roster.  Third, will fighters receive insurance.  Of course, what happens if a fighter is injured and cannot fight the rest of the year.  Will they continue to receive a monthly paycheck.

Obviously, the infusion of cash from the investors seems to be the reason for the newfound promises.  Of course, the big need is for a media rights distributor that will pay for the content with the hope that it can find key sponsorships to carry it through the inaugural season.  We shall see what happens.

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