UFC on Fox 28 draws 2,037,000 viewers; prelims draw 1,214,000 on Fox

February 28, 2018

The official live and same day ratings for UFC on Fox 28 revealed the show averaged 2,037,000 viewers on the network Saturday night.  The prelims which aired on Fox prior to the main card drew 1,214,000 viewers according to Nielsen Media Research.

The prelims started 30 minutes later than scheduled due to an overrun from a college basketball game.  It was the best prelims telecast on Fox since July 2016.  On Fox Sports Go and Fox Now the telecast had an average minute audience of 11,814.  The prelims featured Renan Barao and Brian Kelleher with the New York native earning the victory over the former champ.

UFC Fight Night on FOX averaged 2,037,000 viewers on Saturday according to Nielsen Media Research. The ratings include the overrun which saw Jeremy Stephens stop Josh Emmett.  Saturday night’s performance was 15% better than last month’s 1,771,000 viewers. On FSGO and FOX Now the telecast had an average minute audience of 11,067.  The show peaked with 2,731,000 viewers from 10-10:15pm ET.

The fast overnights had the main telecast with 1.82 million viewers.

The FS1 UFC Post-fight show drew 192,000 viewers.

Saturday night provided stiff competition on the networks as NBC’s coverage of the 2018 Winter Olympics drew 11,422 viewers.  The NBA on ABC Saturday featured Golden State and Oklahoma City with the Warriors blowing out OKC.  But, the game drew 4,051,000 viewers.

Payout Perspective:

The ratings did improve from last month which is a positive for this event.  It did have some stiff competition.  Surpassing 2 million viewers overall is an achievement for this card.

Amazon to stream UFC PPVs

February 28, 2018

Amazon is picking up the rights to UFC PPVs according to a report from the Sports Business Journal.  Terms and length of the deal were not disclosed ahead of a formal announcement later this morning.  The company will stream UFC 222 this Saturday for a priced of $64.99 HD.

As with UFC.tv, the PPV will be available for purchasers for 24 hours on Amazon.

The UFC is shopping its media rights and the Amazon deal indicates it is willing to split its properties into digital and television.  The UFC’s current deal with Fox is reported to be $120 million per year and $160 million in the last year.  Fox has made an initial offer to the UFC for $200 million annually.  The UFC claimed to want $450 per year over 10 years.

The move reflects Amazon’s continued move into sports rights.  Last year, it obtained the right to stream NFL Thursday night games.  It also is bidding for Premier League streaming rights.

Payout Perspective:

Digital streaming rights is competitive as Amazon is competing with YouTube and Facebook for rights to digital events.  Obtaining rights to the UFC likely means the end to sales of its PPV on its own site (or at least a significant loss in sales).  With many people cutting the cord, streaming rights are becoming more valuable to a core audience.  Still, the key to the next UFC television deal will be finding a partner that will be willing to improve on Fox’s initial offer of $200 million.

CSAC revokes Jon Jones’ fight license and fines him $205,000 for failed drug test

February 27, 2018

The California State Athletic Commission unanimously voted (6-0) to revoke Jon Jones’ fight license and invoke a $205,000 fine against him for a banned steroid in his system discovered in a pre-fight drug test at UFC 214.

The $205,000 fine is 40% of his $500,000 disclosed pay (plus $5,000) for his matchup with Daniel Cormier at UFC 214 on July 29th.

At a hearing held on Tuesday morning, the California State Athletic Commission heard Jones’ testimony as well as those from two experts that opined on Jones’ test results and how he could have had Turanibol and its metabolites in Jones’ system.  Jones did not dispute the finding but seemed to rest his case on the fact that he did not knowingly take the substance.  Jones did not appear to be a very good witness advocating on his own behalf.

Notably, Dr. Daniel Eichner stated that he has never heard of an case where a medication, supplement or otherwise to have been tainted with Turanibol or its metabolites.

Jones may re-apply for a CSAC license at the conclusion of his case with USADA.  Jones will need to make a request before the CSAC and receive a majority vote.  His license revocation was set to expire on August 28th per ESPN.com’s Brett Okamoto.

USADA has yet to rule on Jones’ case although his representatives believe it could happen as soon as next month.  According to the UFC Anti-Doping Policy, Jones, a potential second-time offender, could be facing a 4-year ban.

Typically, other states would honor California’s license revocation, so any thought that Jones could fight in another state is unlikely.

Payout Perspective:

The prospects of Jones in a UFC octagon in 2018 looks bleak.  While, the CSAC did not issue a longer suspension, it appears that they are awaiting USADA to do the duty.  Jones’ admission to the test findings likely seals his fate.  The strategy of arguing that Jones did not knowingly take Turinabol but offering no other reason for the test had no effect in mitigating the penalties.  I would not expect USADA to mitigate any penalty either but we shall see.

Superfly 2 on HBO Saturday night peaks with 753,000 for Rungvisai win

February 27, 2018

HBO Boxing’s Saturday night telecast, Superfly 2, drew 639,000 for the main event featuring Sor Rungvisai and Juan Francisco Estrada peaked at 753,000 viewers according to Nielsen.

Runvisai successfully defended his WBC super flyweight title against Estrada with a majority decision.  The co-feature saw McWilliams Arroyo defeat Carlos Cuardras and draw 548,000 viewers and peaked at 598,000 viewers.  The opening fight on Saturday night saw Donnie Nietes stop Juan Carlos Reveco after he was stunned at the end of the 6th round and the ref decided to stop the fight in the 7th.  The fight drew 432,000 viewers and peaked at 533,000.

Payout Perspective:

In comparison with “Superfly” held this past September which saw the rematch between Rungvisai and Roman Gonzalez draw 796,000 viewers and peaking at 835,000.  The ratings for this past Saturday’s event were on par with HBO’s first event in January when Lucas Matthysse stopped Tewa Kiram.  The fight peaked with 769,000 viewers.  The opening bout on that night drew 659,000 viewers and peaking with 731,000.  The ratings may be attributed to the lack of Gonzalez on the card.  Rungvisai may start to pick up some momentum with his second title defense and the appealing fight style.  The “Superfly” cards are great ways to package the lighter weight divisions and hopefully we see more of these in the future.

Danny Garcia tops salaries for HBO event at Mandalay Bay

February 26, 2018

MMA Payout has obtained from the Nevada Athletic Commission the payouts, attendance and gates from last week’s boxing event at the Mandalay Bay Events Center featuring Danny Garcia and Brandon Rios.

The event sold 4,139 tickets for a gate of $925,180.  There were 1,439 total comps.

The payouts were as follows:

Danny Garcia $1,250,000 def. Brandon Rios $500,000

Yordenis Ugas Hernadez $40,000 def. Ray Robinson $30,000

Anthony David Benavidez $400,000 def. Ronald Gravil $125,000

Edwin Rodriguez $12,500 def. Lionell Thompson $14,000

Cameron Ray Burroughs $3,000 def. Jonathan Louis Esquivel $2,000

Joseph Don Spencer $2,500 def. Uriel Gonzalez Anquilo $1,750

Ladarius Miller $10,000 def. Carlos Padilla $8,000

Andres Cortes $4,500 def. Fatioou Fassinou $3,000

Brian Gallegos $4,500 def. Sulaiman Segawa $3,000

Payout Perspective:

A lot of comps for this event with Garcia making more than the entire gross gate for the event.  Aside from Rios, Benavidez, the 168 pound title-holder made the most on the night.  The breakdown of purse sheet was an interesting look at how much is advanced, withheld and given to managers.  According to NAC, Benavidez paid his manager $133,320.  It was the most paid out to a manager.

Plaintiffs’ expert in UFC Antitrust lawsuit takes turn picking apart Zuffa’s economic expert

February 26, 2018

Dr. Andrew Zimbalist had the opportunity to offer a rebuttal report in response to a UFC’s economist undressing of his opinion on the damages in the plaintiffs’ case in the UFC antitrust lawsuit.

In the report he goes after Zuffa’s economic expert, Dr. Roger Blair as he claims that his analysis “provides no insight into Zuffa’s market power or monopsony power.”  As is the case with most rebuttal reports, Dr. Zimbalist picks apart the analysis from Dr. Blair.  He notes that while Dr. Blair pointed out that he did not originally define a market in his original expert report, it was not in his assignment to do so.  Thus, the critique “makes little sense.”

Here, Dr. Zimbalist has the opportunity to critique Dr. Blair’s definition of the market in stating that the basis of revenue generated, not the number of bouts or events.

Thus, the belief is that Dr. Blair is being too broad in his analysis of the market whereas Dr. Zimbalist is being more centralized.

Dr. Zimbalist also defends his use of the “yardstick” method in his original report:

The yardstick method I use to calculate damages, namely, selecting a group of comparators with as much similarity as possible with the target industry or company is one that is used commonly in real estate appraisals. It is also one of the three basic methodologies (comparable sales) employed to value companies: asset based valuation; discounted cash flow valuation; and, comparable sales valuation. More importantly, as Dr. Blair admits, the yardstick approach is a “recognized” approach to calculating damages. However, he claims that my yardstick approach is not acceptable because my comparators are not sufficiently similar to UFC, save the different organizations of their labor markets.

He also defends his use of boxing data in his original report:

Moreover, I also use professional boxing as one of my yardsticks, which suffers from none of the defects Dr. Blair suggests infect my team sport comparators. Boxing is similar to MMA in virtually every respect other than the amount of monopsony power the promoters can
exercise over the athletes, and the absence or unenforceability of many of the challenged
contractual terms due to the Muhammad Ali Act. Boxing has similar total revenues to UFC and
is therefore of similar scale and scope. Boxing promoters have an identical business model to
MMA promoters, with identical sources of revenue such as gate, PPV receipts, licensing fees,
and merchandise. Boxing promoters also incur identical costs to MMA promoters, such as purses for athletes, advertising and promotional expenses, timekeepers, referees, judges, and medical personnel. They also incur some television production costs As in MMA, boxers do not
collectively bargain. Indeed, none of Zuffa’s experts points to any distinguishing characteristic
that would make boxing an inapt yardstick. The only criticism Zuffa’s experts raise is with my
calculation of fighters’ share of revenue in boxing. I address that criticism below.

He also picks apart Dr. Blair’s arguments that the UFC’s conduct is procompetitive citing the flawed comparisons with pro sports free agency.  In this case, he takes issue with the examples of the NFL’s Andrew Luck and Von Miller used by Dr. Blair:

However, the specific examples that Dr. Blair discusses illustrate the important
contextual difference between the relatively competitive market for NFL athlete services and the
current UFC-dominated market for top MMA fighters. Dr. Blair cites the contract negotiations for two NFL players, Andrew Luck and Von Miller.  Both players negotiated contracts with their respective teams without reaching unrestricted free agency Andrew Luck’s team, the Indianapolis Colts, signed Luck to a five-year contract extension prior to the final season on Luck’s rookie contract. The total value of Luck’s contract was $122.97 million with $87 million guaranteed. Von Miller’s team, the Denver Broncos, applied the Franchise Tag to Miller after his final season on his rookie contract and, before the season under the Franchise Tag began, the Broncos signed Miller to a five-year extension worth $114.1 million with $70 million guaranteed. As both Luck and Miller approached free agency, the availability of a competitive labor market allowed them to negotiate contractual terms which allowed them to capture something close to their marginal revenue product, and reflected substantial increases from their prior contracts. UFC fighters have no such prospects.

As noted by Dr. Zimbalist, the issue in the above negotiations rested on the amount of guaranteed money as opposed to the overall contract number.

Also an interesting specific comparison is Dr. Blair’s analogy between the UFC’s “champion’s clause” and the “NFL’s franchise player rule.”  While the NFL’s rule is advantageous for the player that is “tagged,” the champion’s clause does not present the same reward.  Some of the portions of the report are redacted as to the champion’s clause discussion but the arguments remains true that

The report also addresses Zuffa’s other experts which we will get to in another post.

Payout Perspective:

The rebuttal is allowed of the plaintiff as a form of response to the defendant’s report.  Similar to the defendant’s report it is meant to poke holes at the opinion formulated by the opposing side.  Key to note in Dr. Zimbalist’s rebuttal to Dr. Blair’s critique is how he explains how free agency in other sports is different from that in the UFC as it relates to allege procompetitive benefits.  The negotiations differ since the NFL contracts are fought over the amount of guaranteed money in a contract versus the overall value of the contract.  This is due to the fact that many contracts of exorbitant amounts are never paid out that amount, are renegotiated for lower terms or terminated prior to payment.

UFC on Fox 28 draws 1.82M viewers in overnight ratings

February 25, 2018

UFC on Fox 28 drew 1.8 million viewers on Fox Saturday night’s fast overnight ratings.  Despite stiff competition from the NBA and the Olympics the event was able to stave off its worst ratings since being shown on the network.

The event drew 1.82 million viewers, a 0.6 rating in the A18-49 demo and a 3 share according to Television By Numbers.  The ratings do no include the overrun into the 8pm PT hour.

The telecast featured Jeremy Stephens taking on Josh Emmett in a featherweight matchup.  Stephens KO’d Emmett to earn the victory.

The UFC on Fox went up against the Winter Olympics on NBC, the NBA on ABC and a rerun of Big Brother on CBS in the first hour and a 48-Hours rerun in the second.  Both replays on CBS outdid the two hours of MMA on Fox.

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
UFC on Fox 25 1,640,000 2,046,000
UFC on Fox 26 1,780,000 2,107,000
UFC on Fox 27 1,590,000 1,770,000
UFC on Fox 28 1,820,000

Payout Perspective:

The low ratings were expected.  If there is any solace is that it improved on last month’s dismal UFC on Fox ratings.  It also improved from PBC on Fox ratings last week.  Up against the Olympics which drew over 9 million viewers and NBA basketball chipped away at any sort of casual viewership.

UFC on Fox 28 attendance, gate and bonuses.

February 24, 2018

UFC on Fox 28 took place in Orlando on Saturday night and main event headliner Jeremy Stephens continued his winning ways earning a bonus for his stoppage against Josh Emmert.

While the stoppage was not in dispute, the beginning of the end for Emmett started with what look like a knee to a grounded opponent that narrowly missed Emmert.  Even though it was avoided the fight was stopped shortly thereafter.

In addition, Ilir Latif, Alan Jouban and Ben Saunders earned the other $50,000 bonuses.  Jouban and Saunders earned fight of the night with Jouban stopping his teammate, while Latif earned the other Performance Bonus with a first-round win over Ovince St. Preux.

The event drew 10,124 fans for a live gate of $1,064,303.50 at the Amway Center in Orlando, Florida.  It ranked third among the three UFC events that have been held at the venue. UFC on Fox 17 in December 2015 and UFC on Fox 11 in April 2014

The numbers were announced post-event.

Payout Perspective:

It was an entertaining night of fights but one might expect ratings to hover around 1.7 million viewers as it went up against the Olympics on NBC and the Warriors-Thunder NBA game on ABC.  Stephens is ascending his way up the Featherweight ranks and should be considered a contender to challenge for the title after the winner of Ortega-Edgar.

Zuffa’s economic expert dismisses Plaintiffs’ opinion on damages in Antitrust lawsuit

February 23, 2018

In the latest round of filings in the UFC Antitrust Lawsuit, the UFC provided an expert report from Roger D. Blair.  Dr. Blair’s report was meant to rebut the assertions made by Plaintiffs’ expert Andrew Zimbalist.

Dr. Blair’s report argues Dr. Zimbalist’s “yardstick” method of assessing plaintiffs’ damages in the lawsuit was inappropriate and flawed.

Dr. Zimbalist does not conduct a yardstick analysis. He does not search for a
business that is comparable to Zuffa in all important respects. Instead, he uses the sports leagues that he has available to him (NFL, MLB, NBA, and NHL) and some limited data from boxing. He then calculates an average PTRR across these five sports. Even if the PTRR were relevant, which it is not, this average across five different sports cannot serve as a yardstick for Zuffa’s but-for PTRR.

Dr. Blair does not identify a relevant market as he claims that Dr. Zimbalist “never identified a relevant market, nor assessed concentration in any market.”  He does suggest that if you were to define the relevant market it would consist of “all promoters that promoted an MMA athlete who previously competed for the UFC, then the shares of the qualifying promoters within that market and HHI could be calculated.”

Notably, Dr. Blair reviews contracts of the Big 4 leagues in comparing with the UFC contract terms in showing that exclusionary practices through contract extensions are procompetitive.  Dr. Blair gives examples of contracts such as Andrew Luck, Von Miller and Mike Trout.

Despite the claim that the UFC contract’s are exclusionary because they impose exclusivity on athletes, he notes contractual language in other sports that limits athletes:


 

Dr. Blair notes that there are two ways to estimate damages:

Further in the report, Dr. Blair claims that Dr. Zimbalist’s method of calculating Zuffa’s pay-to-revenue ration (PTRR) is not valid:

Dr. Zimbalist calculates Zuffa’s pay-to-revenue ratio (PTRR) as the ratio of UFC athletes’ compensation to Zuffa’s total revenue. Similarly, he calculates PTRR for each of the sports in his yardstick. Dr. Zimbalist’s measure of damages is the difference between the UFC athletes’ compensation as a fraction of Zuffa’s total revenue (Zuffa PTRR) and the average of the fraction of total revenue going to athletes in boxing and the four major league sports in North America (proposed yardstick PTRR) multiplied by Zuffa’s revenues. This measure of damages is fatally flawed.

Here, Dr. Blair claims that labor share of total revenue can vary widely.

Dr. Blair also claims that the comparison with the four major leagues are incorrect because each has a union and bargained collectively with management.

…the athletes in the four major leagues are unionized and bargain collectively with management, while MMA athletes are independent contractors and are not unionized. Collective bargaining likely impacts compensation in the four comparator sports leagues in myriad ways, but at minimum, one would expect that unionized athletes would have increased leverage to demand higher pay, which would impact the percentage of revenue they receive. As a result, one likely cannot compare compensation between unionized and non-unionized athletes in a yardstick analysis because the compensation outcomes would differ regardless of the differences in competition between the yardstick and target firm.

Here, readers may view this as a concession that a union would be better for athletes since unions have “increased leverage to demand higher pay.”  While this may have been an indirect concession on the part of Dr. Blair and the UFC that unions are successful vehicles for better wages, the argument was that the yardstick method claimed by Dr. Zimbalist was not correct.

Further, in his report, Dr. Blair makes this assertion about Dr. Zimbalist’s opinion on multi-year contracts:

Dr. Zimbalist appears to assume all multi-year contracts will be found to be anticompetitive, despite their presence across the comparator sports used in his proposed yardstick. To the extent the court or jury does not find all multi-year contracts to be anticompetitive, they will be left with no valid estimate of damages from Dr. Zimbalist.

He also asserts that Zuffa’s bout compensation various tremendously by Athlete.  However, this section of Dr. Blair’s report is redacted in its entirety.

Payout Perspective:

Dr. Blair’s report is as expected from the UFC.  It was clear that it would oppose the damages claim from Dr. Zimbalist and would criticize the method in which he came up with his damages estimate.  Dr. Blair outlines the differences between the big 4 leagues as well as the small amount of data he used in boxing.  The argument is that Dr. Zimbalist method is not sound when contemplating damages in this case is because it is different from the 4 pro leagues and there is just not enough data from boxing to make the comparison.  The question would be what would have satisfied the UFC’s economic expert?  As we see in Dr. Zimbalist’s rebuttal report, he takes issue with Dr. Blair’s critiques.  With the UFC filing a motion to exclude Dr. Zimbalist, the battle of the experts is a key issue in this lawsuit if it goes to trial.

UFC 222 part of Vegas “Ultimate Sports Weekend”

February 22, 2018

The UFC is promoting the first weekend of March as the Ultimate Sports Weekend.  In addition to UFC 222, the NHL, Rugby and NASCAR will all be in town the first weekend in March.

Billed as the Ultimate Vegas Sports Weekend, it is an interesting promotion to tie in all that’s happening in Vegas that weekend which is typically a pre-cursor to a big group of visitors coming in March for March Madness.

There are 3 Division I NCAA Conference Tournaments in Vegas in March and many will come to Vegas to watch the slate of games the first weekend of the NCAA Tournament.

The Las Vegas Golden Knights are a surprise team in the NHL and will be playing the Ottawa Senators on Friday, March 2nd.  The Rugby World Cup Sevens will be playing in Vegas the weekend of March 2nd.  NASCAR will be holding an event at the Las Vegas Motor Speedway on Sunday March 4th.

Payout Perspective:

The promotion is a good way for all of the sports and organization to work with one another into ensuring the optimal attendance for the events in the city.  The Golden Knights are in its inaugural season and unlike most first-year teams, they are very good.  Rugby and NASCAR and MMA are niche audiences and the hope is that tourism will get an influx of visitors to come and check out these events.  It’s a smart move as there are concerns with tourism after the horrific events of last year.

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