July 24, 2015
The fight attracted a record 16,019 fans to the MGM Grand Garden Arena, plus a $7.2-million live gate and 1 million pay per view buys, proving McGregor’s sizable drawing power. Some 3,000 Irish fans converged on Las Vegas and left deliriously happy.
UFC 189 would be the first PPV hitting 1 million PPV buys since UFC 168 which featured Silva-Weidman II and Tate-Rousey in December 2013. Prior to that, you’d have to look to July 2010 and UFC 116 (Lesnar-Carwin) for a PPV to strike 1 million PPV buys.
If the PPV number is correct, it shows that the ratings from the UFC 189 Prelims were an inconsistent indicator of PPV success. UFC 189 Prelims on FS1 drew only 847,000 viewers. The televised Prelims usually entice “on the fence” fans to purchase the PPV. Here, one might conclude that people already were set to buy the PPV because of McGregor. This would be great for the UFC as it has a confirmed PPV star in the new interim Featherweight champion.
It’s interesting that the information on PPV buys was somewhat buried in the bio of McGregor and not officially announced by the UFC. Usually, when organizations do well business-wise there is some release about the information. For instance, Bellator’s tentpole events 131 and 138 ratings were announced immediately when received as the company was happy with the great ratings. Here, no official announcement. We shall see if we get an official announcement soon.
July 16, 2015
Welcome to another edition of Payout Perspective. This time we take you to UFC 189 which was the biggest event in years for the company taking place at the MGM Grand Garden Arena.
McGregor wins interim Featherweight title
The gamble for the UFC paid off. Conor McGregor stopped Chad Mendes with just seconds remaining in the second round to win the interim Featherweight title. McGregor was in trouble early as he could not stop takedowns and was being held down by Mendes. But, McGregor was able to escape a guillotine attempt and used his power to KO Mendes.
McGregor actually has a coaching spot on TUF this fall and then it’s likely Jose Aldo. Mendes showed well for himself considering he did not have a full camp. He is still at the top of the list of challengers for the Featherweight title.
Lawler outlasts MacDonald in bloody war
It was the best fight in some time and likely a prime example of why this sport can never gain mainstream acceptance. Robbie Lawler’s lip and Rory MacDonald’s nose exemplified the dedication, discipline, heart and fearlessness it takes to make it to the top of this sport. Although MacDonald was ahead on the judge’s cards, he succumbed to the pain and crumpled to the mat in the fifth round after another shot from Lawler.
For Lawler, Johny Hendricks seems like the next opponent for Lawler. Many have said that this fight may have changed the trajectory of MacDonald’s career forever. We shall see.
Attendance and gate
It was the biggest attendance and gate for a UFC event ever since UFC 129 in Toronto. Attendance stood at 16,019 for a gate of $7.2 million. Dana White stated that ticket sales actually surged after Jose Aldo pulled out of the fight getting the gate over $7 million.
On the secondary market the “get in” price at the start of the Fight Pass Prelims was $665. According to Darren Rovell, the median price paid on Stubhub was $500 which was the highest since Silva-Sonnen II ($450).
Conor McGregor, Thomas Almeida, Rory MacDonald and Robbie Lawler earned the $50,000 bonuses.
McGregor and Mendes topped the salaries making $500,000 each. The full list is here.
Promotion of the Fight
The promotion of the fight started with the expensive and well-chronicled world tour with Jose Aldo and Conor McGregor. The Embedded episodes were entertaining as those occurred this past spring. Most of us were hoping that July would come soon. Of course, the fight did not happen and we were given Chad Mendes. More Embedded episodes occurred to promote the fight and even some controversy as it appeared that an episode featuring Conor training in wrestling was edited out. The theory was that it would give Mendes some advantage.
Dana White appeared on ESPN, the Jim Rome and other outlets. Notably, he stated in a radio interview that Aldo would have made $4 million at UFC 189. He also stated on Jim Rome that McGregor wanted to bet him $3 million that he would knock out Mendes. Apparently, he knew what he was talking about.
This was the first event where Reebok uniforms were exclusively used. Overall, it was not as bad as I had thought although I am sure there are some fight fans that will miss the aesthetic of different sponsors on the shorts as well as fight banners.
The official UFC sponsors were in the Octagon including the movie “SouthPaw,” Draft Kings, Toyo Tires, Harley Davidson, Fram,Bud Light, Corn Nuts, Metro PCS, Musclepharm and Monster Energy Drink had the center.
Reebok presented the Embedded episodes featuring McGregor and Mendes.
In addition to announcing an individual deal with Reebok, Rory MacDonald had a Monster logo on its shorts. Same for Conor McGregor. McGregor also starred in a commercial for Game of War.
Toyo Tires also sponsored Chad Mendes and sent out an eblast about the challenger.
Although it was announced in early June, the UFC announced a partnership with Las Vegas Monorail making it the “Official Las Vegas Transportation of the UFC.” While this seems silly, the fact that so many people from out of town (especially Irish McGregor supporters) likely took it as a method of transportation probably made the sponsorship worth its while.
Odds and ends
The changes in production were subtle but great. While there might be a lot of criticism about spending 6 months and who knows how much money to change the “C” in the UFC, the presentation at the weigh-ins and the actual show were top-notch.
The live singing entrances for the main events were an interesting touch.
It was interesting that this fight was not offered in movie theatres like other events before it.
One critique about new UFC production, rounds now noted by filled in marks like balls/strikes in baseball. I like numbers to tell me rounds.
The uplighting and other stage enhancements for the weigh-ins were great. It gave UFC 189 that big fight feel. Of course, the atmosphere with so many Irish there made it feel that much more electric on television.
This was the first event with the USADA drug testing protocol.
It appears that cutmen have lost their sponsor deals when Reebok took over this month but are not a part of the Reebok deal. We will see where this goes.
Mendes has been stopped in two championship fights with seconds left in a round.
I already booked my hotel for UFC 200 which will be in the new MGM-AEG Arena July 2, 2016
1M Google searches for Conor McGregor and UFC 189 related searches. Another 100k for Robbie Lawler.
— Adam Swift (@AdamMSwift) July 13, 2015
Much has been scrutinized about what the PPV buy rate will be for UFC 189. Despite Aldo pulling out late, it appears that it did not hurt PPV sales. The pre-buys for the event appear to be strong which is based on the number of people that purchase the PPV prior to the day of the PPV. The google searches appear strong but the Prelim rating was under 1 million viewers. So, we shall see. My gut reaction is that the PPV did between 550K and 600K buys which solidifies McGregor as a legitimate PPV star.
June 17, 2015
Welcome to another edition of Payout Perspective. This time we take a look at UFC 188 taking place from Mexico City, Mexico.
Werdum Undisputed HW Champ
Fabricio Werdum defeated Cain Velasquez to earn the undisputed Heavyweight title. It was a submission that ended the long-running win streak of Fedor Emelianenko. It was another submission that ended the Heavyweight title reign of Cain Velasquez. Werdum’s guillotine choke ended the night for Cain who seemed gassed despite continuing to come forward during the fight. It was one final lunge at Velasquez that spelled his doom as it seemed that Werdum had a smile on his face as Cain attempted a takedown but was caught by Werdum.
It has been two years since Cain Velasquez had been in the Octagon. It probably was not rust from not fighting but the altitude of Mexico City that could have been the issue. He spent two weeks in Mexico City but Werdum had been there for over a month.
Werdum could face Andre Arlovski or Stipe Miocic next.
Alvarez escapes Gil
Eddie Alvarez scored a split decision over Gilbert Melendez in an exciting co-main event. Despite having his left eye almost shut after round 1 due to a Gil elbow strike, Alvarez came back in rounds 2 and 3 to eke out the win. It must have been a relief for Alvarez to finally get a W in the Octagon after his ordeal with Bellator and losing in his UFC debut last fall.
The decision could have gone either way and these two probably do not lose too much (Eddie #4, Gil #5) in the rankings after the fight.
Next up for Eddie Alvarez? Possibly Benson Henderson since they were originally scheduled to fight earlier this year. We could see this in South Korea in November.
Attendance and Gate
The event drew 21,036 which was 36 more than the UFC’s event last year in the same venue. No gate was announced so we do not know if how many comps were provided.
Fabricio Werdum, Patrick Williams, Yair Rodriguez and Charles Rosa earned the $50,000 fight bonuses. Werdum and Williams earned the Performances of the Night and Rodriguez and Rosa earned the Fight of the Night.
Promotion of the Fight
UFC Embeddeds provided some controversy as Werdum accused Cain of being a “Fake Mexican.” Essentially, Cain is American first and not from Mexico. It was an interesting accusation that reminded me of Oscar de la Hoya-Fernando Vargas from years past. Of course with recent news events about identity, it would be topical if not for the fact that no one seemed to care.
Similar to UFC 180, Doritos advertised for this fight by having the fighters’ likenesses on Doritos bags. It also offered a contest for fans to meet and greet UFC fighters.
(pic via Josh Sanchez twitter)
The Octagon sponsors included MetroPCS, the movie Self/Less, Doritos, DraftKings, Bud Light, Cinemex, BetCris, UFC Mobile from EA Sports and Monster Energy Drink in the center.
BetCris is a Mexican online gambling company. Self/Less is a movie from Universal Studios. It received a little promo featuring Forrest Griffin.
Cain added Monster Energy Drink to his list of sponsors which included Affliction, Oak Grove Technologies and American Ethanol.
Notably, Werdum was sponsored by Reddot.
Odds and Ends
Alvarez’s Underground King shirt, originally made by Jaco, is already on sale (i.e., reduced in price) at the UFC.com store.
Two fights ending in the first round on the UFC Prelims meant a very short night of fights on tv. Speaking of which, it was on FX instead of FS1 due to scheduling conflicts.
UFC 188 was shown in select theatres once again. It would be interesting to know how many people actually went to theatres to watch it.
Is Henry Cejudo ready for Demetrious Johnson yet?
In looking at the success of this event perhaps we look at how it did in comparison to past June PPVs. Traditionally, June PPVs have been terrible. The average PPVs from 2012-2014 is 132,000 buys. Google Trends for UFC 188 showed interest from Mexico by mediocre interest from the United States. Still, one would think that it had to improve on last June’s PPV of 115,000. I have an optimistic estimate of 200,000 PPV buys.
June 13, 2015
With UFC 188 set for Saturday, we shall see whether the event featuring Cain Velasquez and Fabricio Werdum improve upon June’s usual dismal PPV buy rates.
Based on the info compiled by MMA Payout:
2011 UFC 131, Vancouver, BC – Dos Santos vs. Carwin – 330,000
2012 UFC 147, Belo Horizonte, Brazil – W. Silva vs. Franklin – 140,000
2013 UFC 161, Winnipeg, Manitoba – Evans vs. Henderson – 140,000
2014 UFC 174, Vancouver, BC – Johnson vs. Bagautinov – 115,000
This year’s June event takes place from Mexico City, Mexico. The card is stacked with Mexican and/or Mexican American fighters.
One would think that the return of Cain Velasquez as he takes on the interim Heavyweight Champion Fabricio Werdum would draw more than the 181,000 average for June PPV buys the past 4 years. Moreover, Gilbert Melendez versus Eddie Alvarez is a real strong co-main event. Yet, there seems to be a lack of buzz for the event. Notably, despite a sellout in Mexico City last October, the PPV buy rate drew just 185,000.
The last time a June PPV surpassed 500K buys was Chuck Liddell’s last UFC fight against Rich Franklin in 2010. UFC 115 drew 525,000 PPV buys. With the big July card up next, June’s PPVs seem to be overlooked. This time, June’s PPV offers some big fights. The question is whether fight fans will tune in to pay for it.
June 11, 2015
Forbes announced its annual list of highest paid athletes. As expected, boxer Floyd Mayweather, Jr. topped the list earning $300 million including endorsement deals. His opponent, May 2nd, Manny Pacquiao landed second on the list.
Mayweather tallied $285 million in pay from June 2014 to June 2015. He earned $100 million on fight night against Pacquiao but the revenue does not include PPV (which were an astronomical 4.4 million buys), gate ($73 million) and fight sponsorships ($13 million). According to Forbes, the fight is expected to gross $600 million once the dust settles. For his May fight, he also earned another $15 million in sponsorship money from Hublot, FanDuel and Burger King. Mayweather’s earnings also include his September 2014 fight with Marcus Maidana.
Pacquiao landed second on the list earning $160 million. The earnings include his November 2014 fight in Macau against Chris Algieri. Pacquiao earned $125 million in pay from the Mayweather fight and $23 million from his Algieri fight. He drew $148 in pay and drew $12 million in endorsements from a variety of sponsors including Nike, Foot Locker, Wonderful Pistachios, Nestle’s Butterfinger and a variety of Filipino sponsors. Prior to the event, it was reported that Pacquiao would garner $2.25 million from sponsors on his trunks alone.
It’s the third time Mayweather has topped the list and his earnings set the record for athlete earnings in a year. Tiger Woods earned $115 million in 2008 which was the previous record.
Wladimir Klitschko made the Forbes Top 100 paid athletes at #63 making $22.5 million. There were no MMA fighters on the list.
The list reflects the fact that boxing’s top stars command the most money. Overall, the sport of boxing may not pay all of its fighters well, but the earning power of Mayweather and Pacquiao show that the sport is still a draw when there are big fights. The money made by Mayweather this year is based on the split in revenue from the Pacquiao fight in which he controlled a dominant share of the money drawn from the event. It’s unlikely we’ll see another athlete earn this much money in a 12 month span for a long time.
May 19, 2015
MMA Fighting posed the question as to how well will UFC 187 do this weekend in light of the big Mayweather-Pacquiao fight earlier this month. Despite the steep PPV price of $90-$100, an estimated 4.4 million people paid to see the fight. Now, will combat sports fans turn around and pay another $60 this weekend?
The question infers something about combat sports fans — they don’t have the money to buy both PPVs. Granted, paying an extra $160 on your monthly cable bill does dent in a household’s leisure budget. While many on social media like to trash the Mayweather-Pacquiao event for their own self-indulgence, it still did astronomical financial business. And, based on the financial numbers, it was an event that many did not want to miss regardless of how much the PPV cost.
Although there is no precedent for a boxing event affecting a UFC PPV, the article uses the Mayweather-Canelo Alvarez fight in September 2013 as an example in how UFC PPVs were affected. The price point for the “The One” was $75 HD which was the most for a boxing PPV until this May. The next three UFC PPVs did alright business but could have done better.
Via MMA Payout Blue Book:
UFC 165 – 09/21/13 Jones vs. Gustafsson – 310K PPV buys
UFC 166 – 10/19/13 Velasquez vs. JDS III – 330K PPV buys
UFC 167 – 11/16/13 GSP vs. Hendricks – 630K PPV buys
It was not until December 2013’s big card at UFC 168 (Rousey-Tate, Silva-Weidman II) that the UFC bounced back. The end of year card drew over 1 million PPV buys. Notably, it was the last time a UFC hit 1 million buys and it was the first PPV increase in some time ($55 to $60).
Still, the question is whether boxing will hurt the UFC. There are various factors which may be contributing, or independent of the buy rate for this weekend’s UFC. Boxing does skew an older audience and it does perform well along ethnic lines. Also, do not discount the Mayweather-Pacquiao fight as a “once in a lifetime” thing even if it may have occurred too late for fight purists. Frankly, the fight was for the casual fight fan because they know the two fighters and have been waiting to see the fight for so long. In addition, the unique partnership between HBO/Showtime to drive the event helped. It initiated its satellite and cable distributors to actively solicit those subscribers into purchasing the event (i.e., it offered assistance to subscribers to order the event prior to the day of it.).
So does the big numbers for Mayweather-Pacquiao mean the casual combat sports fan will be checking out of UFC 187?
Regardless of what we may think of the UFC fan, it does skew younger than the boxing audience and based on surveys, within the demo, these fans have money to spend. Will it hurt the PPV buy rate for this weekend? I would suggest that you might look at the last trends for Memorial Day weekend.
What used to be a big weekend for the UFC has turned into a mediocre one. In the past 4 years, only 2012’s JDS-Mir garnered over 500K PPV buys.
2015 – UFC 187 – Johnson-Cormier ?
2014 – UFC 173 – Barao-Dillashaw 215,000
2013 – UFC 160 – Velasquez-Bigfoot II 380,000
2012 – UFC 146 – JDS-Mir 560,000
2011 – UFC 130 – Rampage-Hamill 325,000
The double main event should help sell this weekend’s PPV. Johnson-Cormier and Weidman-Belfort are both title matches that should bring some interest. While it’s hard to gage whether Chris Weidman is a PPV draw, he has made enough appearances on FOX/FS1 for people to know him. The absence of Jon Jones may have hurt PPV sales but taking him off the card was likely best for long-term business. The two title fights and the lack of boxing this weekend should help get this PPV up to over 500,000 PPV buys. We shall see.
May 14, 2015
The Wrestling Observer (subscription recommended) reports the PPV estimated buy rates for the last two UFC events. UFC 185 drew 275,000 while the much-maligned UFC 186 garnered somewhere between 100,000-125,000 buys. It also updates the estimate for UFC 184.
The PPV estimates are based on information obtained from Dave Meltzer. UFC 185 featured two title fights with Rafael dos Anjos winning the lightweight title from Anthony Pettis and Joanna Jedrzejczyk’s victory over Carla Esparza for the women’s strawweight title. Yet, it failed to break 300,000 PPV buys.
Most expected the poor PPV buys for UFC 186 so the 100,000-125,000 PPV buy rate estimate seems appropriate and might even be better than anticipated. It’s the second time that Demetrious Johnson has main evented a PPV with such low PPV buy rates. His fight at UFC 174 against Ali Bagauitinov mustered just 115,000 PPV buys. UFC 186, taking place in Montreal, was hindered by the cancellations of the rematch between TJ Dillashaw and Renao Barao and then the Rory MacDonald-Hector Lombard fight was called off. On top of that, there was the removal of Rampage Jackson from the card only to be added back onto the card after a trial court’s injunction was overturned by a New Jersey appellate court during fight week. UFC 185 featured Demetrious Johnson taking on Kyoji Horiguchi.
On the bright side, UFC 184 PPV featuring Ronda Rousey’s quick tapout of Cat Zingano is up to 590,000 buys.
Below are the PPV buy rate estimates this year so far:
While the UFC had a great first quarter of PPVs, it has produced two shows that many believe underperformed and/or underwhelmed. Even with two title fights and hometown favorite Johny Hendricks on the UFC 184 card, it still did not produce on PPV. UFC 185 was expected to draw low PPV numbers based on the constant shuffling on the card and the stark reality that Johnson just does not draw PPV buys. We should see a bounce back with next week’s UFC 187. Even without Jon Jones, we should see a decent buy rate with Weidman-Belfort and Cormier-Johnson heading the card.
May 12, 2015
Yahoo! Sports reports that the official PPV buys for the May 2nd fight between Floyd Mayweather and Manny Pacquiao drew an astronomical 4.4 million PPV buys that equates to more than $400 million in revenue. The numbers shatter the old PPV buy rate record set by Mayweather and Oscar De La Hoya in 2007 and the revenue record set by Mayweather and Canelo Alvarez in 2013.
The live gate for the event also drew more than $72 million which also did better than the previous record set by Mayweather-Alvarez. According to the NSAC, Mayweather-Pacquiao drew 16,219 for a gate of $72,198,500. May-Alvarez drew 16,146 for a little over $20 million.
The PPV outdid the 2.2 million PPV buys set by Mayweather-De La Hoya in 2007.
Kevin Iole’s Yahoo! article also indicates that May-Pac sold more than 46,000 closed-circuit seats in Clark County, Nevada which pushed total revenue to more than $500 million.
Mayweather Promotions CEO Leonard Ellerbe attributed Mayweather’s star power as well as social media as well as the mainstream media push. Of course, Pacquiao’s presence probably assisted in the interest in the fight too.
It’s clear that despite some negativity surrounding the fight did not diminish any of those wanting to purchase the PPV or watch the fight in person or closed-circuit. Social and mainstream media probably helped with the promotion of the fight but the pro-active nature of the cable and satellite distributors to push subscribers to purchase the PPV ahead of time also helped with the buy rate. The revenue records were likely considering the $100 PPV price point for HD or $90 for SD. Also, the high ticket prices and lack of comps were also factors for the record-setting gate.
April 23, 2015
The UFC issued a statement regarding the situation. The statement in part reads:
Due to contractual issues, DISH Network will not be offering UFC 186: Johnson vs. Horiguchi on Pay-Per-View this Saturday. While all other providers in the U.S. have come to an agreement on renewal terms, DISH Network has elected not to renew its distribution agreement with UFC.
Via MMA Junkie:
The industry leader signed a multi-year deal with Dish that ended on Jan. 31, though an extension was inked for March’s UFC 185, according to a person familiar with the UFC’s agreement. The person requested anonymity because he was not authorized to speak publicly on the matter.
A Dish Network rep confirmed the impasse with the UFC and that it would not offer the pay per view to its subscribers. It did indicate that the two sides were in negotiations for further events.
According to this Broadcasting & Cable article in which Dish inked a deal to carry the Weather Channel, Dish Network is a notoriously difficult negotiator. Of course, the UFC probably is seeking a bigger percentage of the PPV revenue. At this point, it has some leverage in a new deal since it had a big first quarter of 2015 with its PPVs and Dish has lost PPV revenue due to the WWE Network. You may also argue that due to the bigger cut HBO/Showtime is taking from PPV revenues from distributors, Dish is not seeing returns via PPVs. Thus, the UFC is seeking a better contract. Of course, UFC 186 is one of the weakest cards (on paper) despite the return of Rampage Jackson to the card. We will see if the two sides will be able to come to an agreement by UFC 187 which looks to be a big show.
April 18, 2015
The New York Times reported on the unusual need for a central system to be used for the logistical payouts for Manny Pacquiao and Floyd Mayweather with respect to the long-awaited fight coming May 2nd.
The article primarily relies on quotes from Pacquiao promoter Bob Arum with respect to how the gross revenues will be divided between the two fighters and other ancillary entities.
For Pacquiao, he is on the wrong-end of a 60-40 revenue split but should clear over $100 million when all is said and done. Of course, the IRS will take its share from Pacquiao (and Mayweather we assume) right off the top.
Rival networks, HBO and Showtime are co-producing and co-distributing the PPV event. They have dueling shoulder programs on its respective networks and in a unique production agreement, each of the networks’ broadcast teams will participate in the event (including dueling ring announcers). The two sides have created a central accounting system to ensure what one might believe is “integrity” in splitting the revenues from what should be the biggest event in boxing history (at least from a gross profits standpoint).
The central system will distribute the revenue in accordance with the contracts of the two fighters.
All revenue from the fight would be put into the central accounting system. This would include foreign broadcast rights, closed-circuit income, ticket sales, sponsorships, merchandise sales, etc. The estimate of these monies per the NYT is at $130 million. In addition, PPV revenue which could gross $300 million also goes into this pot.
Most of the PPV revenue will go to the fighters minus 15% (7.5% each for HBO and Showtime). You may recall that HBO and Showtime were in vigorous negotiations with the satellite and cable companies regarding the PPV distribution for the event.
A “wrinkle” pointed out by Arum is that the winner of the fight will receive a 51-49 percent split for revenue between $160 million and $180 million. Thus, ideally the winner will receive $10.2 million while the loser gets $9.8 million. The amount over $180 million reverts to the 60-40 split in favor of Mayweather.
Despite the lofty price point for this PPV, it is believed it should break the PPV record. Similarly, the $72 million gate at the MGM will break a record as well. One might assume the same for international rights, closed-circuit money, sponsorships and merchandise. It’s clear that the logistics for splitting up the revenues required a central system (we assume with necessary checks, balances and protocols).