April 22, 2015
In light of Zuffa’s announcement that it has changed the policy through which it will compensate fighters under the Reebok sponsorship deal, a manager of UFC fighters has spoken out about the deal and the sponsorship landscape. Oren Hodak of KO Reps who represents Johny Hendricks, Ovince St. Pierre and Joe Lauzon among others has expressed his opinion on the problems with the current state of MMA sponsorship.
“The current problem in the MMA landscape is the managers/agents that are in the business. They aren’t working hard enough or smart enough going after non endemic brands. They are simply seeing a logo on another fighter and then contacting that company. Or even more pathetic is agents calling another agent to help them out with a deal,” Hodak told MMA Payout. Hodak holds a Master’s degree in Sports Marketing and worked in the sports industry for several years before opening up his MMA management company.
“KOreps has had great success giving companies such as Reebok, Bass Pro, Smart Stop Self Storage, Instaloans and most recently Parts-express.com their first real taste of Octagon exposure in addition to partnering with fighters outside of the cage,” stated Hodak. “Sure, the sponsor tax takes money out of budgets from your core MMA clothing and supplement companies but there are plenty more companies out there with a sports marketing budget. Over the years the UFC has slowly raised the sponsor tax and added numerous categories to the non-approved list, giving fighters less and less opportunity. In turn, managers have an excuse as to why they aren’t producing and UFC has fighters openly complaining about sponsorship money.”
On Monday, the Sports Business Journal reported that the UFC had changed the way it would pay its fighters through the Reebok sponsorship deal which goes into effect in July. Instead of relying on media rankings, it would base the sponsorship pay on the number of fights an individual has had under Zuffa. This would include fights in Strikeforce and WEC after both were acquired by Zuffa. The change in the policy was said to be based on speaking with a number of fighters and managers.
“Some fighters may come out ahead with this new deal but I believe the fighters with professionally qualified sports management behind them will not,” Hodak added, “We have already heard from numerous fighters losing deals because they can’t utilize the valuable fight night impressions surrounding tv viewership.”
It’s clear that despite the change in payment structure, the UFC-Reebok deal will still affect the bottom line of many fighters. Hodak points out an issue he sees as a manager of fighters. It’s an interesting viewpoint and a constructive critique on the nature of the business. It also calls into question the management practice of some in the industry. Not only will the sponsorship landscape change in the UFC, but the management of fighters may change too. We shall see how this plays out in the UFC after the Reebok deal is put into place this summer.
April 21, 2015
In a surprising turn of events, the New Jersey court that issued the preliminary injunction preventing Rampage Jackson from fighting on Saturday’s UFC 186 card has reversed its decision. At this point, no court records have surfaced but Bellator has issued a statement indicating that it is “disappointed (the court) reversed the injunction as to the April 25 fight.
Bellator has released a statement on Rampage, saying it is “disappointed (the court) reversed the injunction as to the April 25 fight.”
— Brett Okamoto (@bokamotoESPN) April 21, 2015
Jackson released his own announcement via social media:
One can only guess the reasons for the Court to reverse its decision at this point. In its opinion issued on April 7th, it appeared that the Court seemed dead set that Rampage had breached his contract. Unless there was a procedural defect, the Court must have been persuaded by another issue it overlooked to reverse its opinion. MMA Payout will have more as the information becomes available.
UPDATED: Not surprising, the UFC is pleased with Tuesday’s ruling overturning the preliminary injunction. “We are happy with the decision from the New Jersey Court allowing Rampage to fight in Montreal this Saturday night,” UFC President Dana White said, “I am looking forward to seeing Rampage back in the Octagon.”
April 21, 2015
The third episode of Show Money talks Rampage injunction, an update on the UFC Antitrust lawsuit, Phil Davis to Bellator and the dismissal of Zuffa’s lawsuit in New York. I join Bloody Elbow’s Paul Gift and John Nash to talk, debate and discuss these issues.
April 20, 2015
Sports Business Journal reports (subscription recommended) that the UFC is making a change to the way it will compensate its fighters through the Reebok deal. Instead of paying fighters based on media rankings, it will pay fighters based on a “tiered system” based on tenure or number of UFC bouts fought.
There will be 5 tiers based on the number of fights an individual has had with the UFC. The article indicates that the UFC will count fights with the WEC and Strikeforce into the number of fights an individual has fought with the organization. There will be tiers of 1-5 fights, 6-10 fights, 11-15 fights, 16-20 fights and more than 21 fights according to the article.
Title fights will be an exception to this rule as the fighters will receive greater compensation. The UFC declined comment on sharing the amount of money each tier would receive.
The change is based on speaking with fighters and managers about the new Reebok deal according to UFC senior vice president of global consumer products, Tracey Bleczinksi.
The article includes quotes from Glenn Robinson of Authentic Sports Management and Ronda Rousey’s manager Brad Slater. Robinson indicated that the sponsorship money has dried up over the years and that the Reebok deal is “more sustainable.” Slater acknowledged that despite the number of sponsors a fighter may have, the total money earned was not “a really significant number.”
The new “tiered” system appears to be a much more fair system than the media rankings which were widely criticized. The system which rewards a fighter based on time served in the UFC (or WEC or Strikeforce) is a much more stable way of determining how a fighter will be compensated through the Reebok deal. It also gives a fighter incentive to do their best to stay in the UFC. Still, the unknown is how much a fighter will be paid through the deal. The UFC does leave itself an out as the policy allows it to pay fighters more in championship bouts (e.g. McGregor at UFC 189).
The article points out that the change was based on discussions with fighters and their managers about the deal. It’s interesting that these discussions happened now and not during the time prior to the Reebok announcement. The new change should give a fighter more certainty as to what tier they are in and an expectancy as to how much they should receive from Reebok.
April 19, 2015
Televison By Numbers reports that the UFC on Fox 15 event on Fox Saturday night drew an average of 2.43 million viewers which narrowly edged out the New York Rangers-Pittsburgh Penguins NHL game on NBC.
UFC on Fox 15 scored 2.43 million viewers, a 0.9 rating among the 18-49 demo and a 4 share. The event ran from 8:00pm-10:00pm. There was little, if any overrun as Luke Rockhold stopped Lyoto Machida in the main event. The NHL on NBC (8:00pm-11:00pm) drew similar ratings with 2.41 million viewers, a similar 0.9 rating in the 18-49 category and a 3 share.
The UFC event was also up against the NBA Playoffs which aired on cable.
UFC on Fox 11 event which aired about the same time last year drew an initial overnight rating of 1.99 million viewers and was adjusted up to 2.5 million viewers.
In terms of overall viewership for the night, TV By Numbers is reporting that 48 Hours on CBS drew 6.25 million viewers in the 10pm slot Saturday
This is a very good rating for the UFC considering it went up against the NHL Playoffs. While it’s only the first round, one would think that the New York-Pittsburgh matchup would draw considerable interest from the two of the biggest television markets. MMA Payout will have more on the ratings as they come in.
|UFC on Fox Ratings|
|UFC on Fox 1||5,700,000|
|UFC on Fox 2||4,570,000|
|UFC on Fox 3||2,250,000|
|UFC on Fox 4||2,360,000|
|UFC on Fox 5||3,410,000|
|UFC on Fox 6||4,220,000|
|UFC on Fox 7||3,300,000|
|UFC on Fox 8||2,380,000|
|UFC on Fox 9||2,800,000|
|UFC on Fox 10||3,220,000|
|UFC on Fox 11||1,980,000|
|UFC on Fox 12||2,500,000|
|UFC on Fox 13||2,800,000|
|UFC on Fox 14||2,820,000|
|UFC on Fox 15||2,430,000|
April 13, 2015
The adjusted viewership for Saturday night’s PBC primetime telecast on NBC drew 2.9 million viewers. The show peaked with 3.4 million viewers.
The ratings reflect a 15% drop from its debut in March which drew an average of 3.4 million peaking at 4.2 million.
NBC Sports PR tweeted out further info:
Sat.’s #PBConNBC averaged 2.9 million viewers, ranking as 2nd most-watched boxing broadcast in 17 years, trailing only NBC’s first PBC event
— NBC Sports PR (@NBCSportsPR) April 13, 2015
Viewership for PBC on NBC on Sat. increased every half hour & peaked in final rounds of Garcia-Peterson with more than 3.4 million viewers — NBC Sports PR (@NBCSportsPR) April 13, 2015
PBC on NBC was up 162% among avg. viewers, and up 190% in the P18-49 demo compared to avg. afternoon boxing telecasts on NBC from 2012-14
— NBC Sports PR (@NBCSportsPR) April 13, 2015
More information on the ratings can be found in our initial post.
It’s clear from the numbers that the second network telecast of Al Haymon’s PBC did not do as well as the debut. The show’s peak this time around was the average viewership for the debut. What is interesting is the positive spin in coverage of these boxing ratings as opposed to what you might read from MMA ratings. The last NBC Sports tweet is indicative of the positive view on the ratings. While we might conclude that boxing will do well in the 18-49 category, the 190% seems overblown as to the actual amount of difference. Moreover, it does not factor in the amount expended in the marketing and promotion of PFC versus those afternoon boxing telecasts. Regardless, the viewership is good for the sport no matter how you want to view it.
April 12, 2015
The second event for Premier Boxing Champions on NBC network television drew 2.62 million viewers in Live + Same Day ratings according to Television By Numbers. It also drew a 0.7 rating in the 18-49 demo and 3 share for its 8:30pm-11:00pm airing.
The ratings are down from its debut in March of 3.13 million viewers in fast overnights and the adjusted viewership of 3.4 million. We might expect an adjustment of the 2.62 million but it likely won’t exceed the PBC debut on NBC.
PBC featured Danny Garcia defeating Lamont Peterson and an entertaining opener on the show with Andy Lee and Peter Quillin fighting to a draw. The Lee-Quillin fight was the more exciting of the two as Lee fought back from two knockdowns to score one of his own and getting a draw.
NASCAR Sprint Cup on Fox outdrew PBC Boxing with its 2 hour showing on the network from 8-10pm. It drew 4.65 million viewers with a 0.9 rating and 4 share.
In the quarter hours TV By Numbers breaks down PBC’s ratings:
8:30-9:00 – 0.7 rating, 3 share, 2.62 million
9:00-9:30 – 0.7 rating, 3 share, 2.62 million
9:30-10:00 –0.7 rating, 3 share, 2.80 million
10:00-10:30 – 0.9 rating, 3 share, 2.97 million
10:30-11:00 – 0.9 rating, 3 share, 3.07 million
PBC went up against the NCAA College Hockey Championship Game on ESPN and NASCAR on Fox. Also of note, in the 10:00-11:00 hour, 48 Hours on CBS outdrew PBC in total viewers 5.07M to 3.07M. Despite not doing as well as its debut, the production of the show was well done. It’s clear it’s a big investment when Bob Costas is on the show. We will see if viewership picks up over time. Certainly, Haymon, et al are prepared to stick it out with its investment.
April 11, 2015
The Plaintiffs in the Le v. Zuffa, LLC (and related) antitrust case(s) have filed its opposition to Zuffa’s Motion to Transfer Venue to Las Vegas. Its main argument is that the forum selection clauses in the plaintiffs fight contracts are inapplicable in this antitrust action.
Earlier this year, Zuffa filed a motion to transfer venue from the federal court in San Jose to the federal court in Las Vegas citing, among the issues, the contractual agreements signed by the fighters. Also, it argued that many of the witnesses are residing in Vegas thus it would be more convenient for this litigation to occur in Las Vegas.
On Friday, Plaintiffs filed opposition to the motion which states that the forum selection clauses (the contractual language in the fight contracts binding fighters to bring legal action in Vegas) are not applicable in this antitrust matter. It argues that the contractual language only related to issues “to interpret or enforce” the contracts and Plaintiffs argue that the contracts are only relevant to the effect that the UFC used them as part of its anticompetitive scheme. The Plaintiffs go on to state in its pleadings that the UFC “torture the text of the Agreements and ignore the weight of authority that defeats its Motion.” Essentially, the UFC misinterprets its own contracts in this matter.
UFC has issued its own statement in relation to the opposition filed Friday:
“As expected, the plaintiffs have filed their opposition to our motion to dismiss. Nothing in their opposition changes our view that their complaints are filled with conclusory allegations that are not adequate to support their antitrust claim. As we laid out in our motion to dismiss, UFC has competed in a lawful manner that has benefited fighters and built UFC into a premier organization in the sport of Mixed Martial Arts.
Indeed, UFC properly competes with other MMA promoters, fairly compensates its athletes and has created a product that is enjoyed by millions of fans around the world. Our legal position is solid and we intend to prevail in this lawsuit.”
The hearing date on the motion to transfer venue is set for May 7th.
In addition to this motion, Zuffa has filed a motion to dismiss with the opposition brief pending.
MMA Payout will keep you posted on this motion. Plaintiffs argue several other points in its opposition which will cover in the coming days. Essentially, the Plaintiffs argue that despite the fighters signing their fight contracts which subject them to jurisdiction in Las Vegas, the headquarters of the UFC, the claims that they bring do not relate to the enforcement of the contract. The contract is only evidence of the anticompetitive nature of the organization. In addition, Plaintiffs argue that key individuals do reside in San Jose and thus it should stay in the district. Also, they claim that based on median time of filing to trial, it is faster (25%) to trial in San Jose than Las Vegas.
April 7, 2015
MMA Payout had the opportunity to speak with University of Missouri professor Nicholas Watanabe. His most recent study focuses on research related to the PPV habits of UFC fans as opposed to those that attend live events. The results are interesting.
Notably, his findings suggest that Heavyweights draw more on PPV than other weight classes. However, those that attend UFC live events are not as picky when it comes to which weight classes are on a particular card. In the interview, we cover his study which is featured in the latest edition of the International Journal of Sport Finance (cite: 2015, Vol 10, No. 1, 26-41). The study is entitled, “Sources of Direct Demand: An Examination of Demand for the Ultimate Fighting Championship.”
We also talk a little Mayweather-Pacquiao as well toward the end of our talk.
April 6, 2015
In its latest issue, Lorenzo Fertitta spoke with the Sports Business Journal (subscription required) on the UFC taking a tougher stance on drugs. Fertitta shed some light on the need for a new policy after the spate of failed drug tests.
While there was nothing in the article that added on to what the UFC has already said about its new policy on drug testing, Fertitta talked about being more proactive about the issue in asking what the UFC could do rather than what the commissions could do.
In the SBJ article Fertitta is quoted as saying: “We needed to stop having academic debates on the legalities of our contracts and just go do this.” He added, “You get hung up in a conference room with a slew of lawyers. We could debate this for years to come and never get anywhere. We’ve always run this business for the long term, so we’re going to do this.”
The UFC will pay for additional tests for its fighters and will advocate for a 2 year suspension for any fighter who tests positive for a banned substance. He indicated that the UFC will “advocate rather than act” at this point due to the current employment contracts of its independent contractors.
However, Fertitta intimated that future contracts would reflect the stiffer penalties for drug violations. These contracts would also include an appeal and arbitration process for suspended fighters.
The UFC will implement its new drug policy on July 1, 2015.
Fertitta takes a shot at lawyers although in the article he indicates that there are complex legal issues to implement its new policy when it comes to an appeal and arbitration process. Thus, he needs them. We saw the issues the UFC had when it came to the appeal process with Cung Le and the new appeal/arbitration policy will be interesting if the suspensions are longer than what commissions require. Obviously, the new contracts will pose a question for fighters. Sure, the drug policy is a good thing to adhere to fairness, but how much of an independent contractor’s rights are being given up?