Iaquinta still not happy with UFC

April 24, 2017

Al Iaquinta is not mincing words when he it comes to the UFC.  In an interview on The MMA Hour with Ariel Helwani, he talked about the UFC bonus system and how it controls everybody.

Despite being on an 8-1 win streak since TUF 15, Iaquinta has spoken out about fighter pay and event contemplated retirement.  He pulled out of UFC 205 due to a dispute over his pay.  Without another UFC post-fight bonus, he tweeted his displeasure with the UFC.

Iaquinta had been banned from post-fight bonuses because of the UFC’s belief that he purposely skipped a UFC fighter summit in Las Vegas.

Iaquinta stated that the $50,000 bonuses is used as a way to control the fighters.

Payout Perspective:

It’s obvious that bonuses are a way to entice fighters.  You hear some fighters (mostly those lower on the pay scale) request in their post-fight interview for the $50K bonus.  The more exciting the fight, the bigger possibility that a fighter may get the $50K.  So, you can see where Iaquinta is coming from.  However, this “carrot and stick” happens in all forms of business and not just the UFC.  The more interesting issue will be what the UFC decides to do with Iaquinta.  Certainly, the easiest thing to do would be to not renew Iaquinta’s deal once it is over and allow him to leave for Bellator.

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.

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.”

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.

S&P Global reaffirms UFC Holdings, LLC debt rating, outlook

April 17, 2017

S&P Global Ratings reaffirmed UFC Holding’s first lien “B+” rating after news of seeking $100 million in additional loans.  Due to its high leverage, S&P rated UFC Holdings, LLC as having a negative outlook.

For a definition of S&P’s ratings, look here.  A “B” rating is characterized as, “more vulnerable to nonpayment than obligations rated ‘BB’, but the obligor currently has the capacity to meet its financial commitment on the obligation. Adverse business, financial, or economic conditions will likely impair the obligor’s capacity or willingness to meet its financial commitment on the obligation.”

The UFC plans to use the additional loans for “earn-outs” and other payments to the Fertitta brothers and Flash Entertainment, the previous owners of the UFC, if the UFC achieves certain benchmarks with its EBITDA “sometime this year.”  As indicated last year, the company must achieve $275 million EBITDA within 12 months.  In the following 12 months, it must achieve $350 million EBITDA to achieve a monetary benchmark.

S&P noted that through 2018, it expects an adjusted leverage above 9x which is “pro-forma” for the additional $100 million term loan add-on.  But, it adds that the company has a “plausible and robust growth path.”  Thus, S&P affirmed its “B” corporate credit rating on UFC Holdings, LLC and “B+” issue-level rating on the company’s $1.475 billion first-lien term loan due 2023.

In July 2016, UFC Holding’s LLC was given a “B” rating and a negative outlook on a $1.45 billion first lien loan to acquire Zuffa, LLC.  As we wrote back in July, “the financing for the deal to acquire the UFC will consist of the $1.45 billion credit facility which will consist of a $150 million revolver due 2021 and a $1.3 billion term loan B due 2023.”

According to the S&P report, it affirmed its “CCC” rating for the second-lien term loan of $425 million due in 2024.

Also of note, WME-IMG will receive $25 million in an annually management fee.  It also states that an upgrade in rating will not occur prior to a new domestic media rights contract is renegotiated.

The report notes that while the UFC has a strong appeal to the 18-34 demo, “it needs to continue to develop fighters” that appeal to this target demo.

Prior to the acquisition by WME-IMG, in November 2015 Zuffa, LLC had a company corporate rating of BB and its outlook was stable.  This was an upgrade in outlook which was previously negative.

The report from S&P Global Ratings came out on April 4th.

Payout Perspective:

As in July, S&P seems optimistic on UFC Holdings, LLC and its ability to repay the debt (at least for the first-term loan).  The report notes that the WME-IMG and its other investors may provide “temporary” financial support in the event of unexpected financial difficulty.  This may attribute to the rating in comparison to previous ratings for Zuffa, LLC.  Despite the additional loan capacity, UFC Holdings, LLC’s rating did not slide and it still projects a negative outlook for the holding company.  Obviously, with the increase in debt capacity the negative outlook seems warranted.  Then there is the issue, or nonissue, of the company’s EBITDA.  Federal regulators announced concerns with the “add-backs” included in its EBITDA forecast.  The projected EBITDA forecast appears to be linked to the belief that it will increase its media rights deal.  WME-IMG has reduced costs since taking over which was highlighted by the reduction of the UFC work force which should please investors looking to scoop up its debt.  The S&P report seems bullish on its EBITDA noting a “plausible and robust growth path.” B

UFC on Fox 24 draws lowest-ever overnight rating

April 16, 2017

Television By Numbers reports that UFC on Fox 24 drew 1.74 million viewers on Saturday night.  The event is the lowest rated UFC on Fox ever although it does not include the overrun.

UFC on Fox 24 featured Demetrious Johnson defending his UFC Flyweight title against Wilson Reis.   Johnson defeated Reis via armbar submission.  Also, Rose Namajunas submitted Michelle Waterson in the co-main event of the main broadcast which aired from 5-7pm PT.

UFC on Fox drew a 0.6 rating and a 2 share in the adult 18-49 demo.

According to Nielsen, the Easter tradition of ABC showing The Ten Commandments drew over 5 million viewers.  A prime time showing of the NHL Playoffs drew 2.29 million viewers on NBC.

Notably, The Ten Commandments drew a 3 share in the adult 18-49 demo, the best in the 8-10pm time slot.

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

Payout Perspective:

It’s the lowest rated UFC on Fox ever although you might see a bump since the Demetrious Johnson-Wilson Reis did not start until about 5 minutes left in the time slot window.  Still, you would have expected better ratings for Namjunas-Waterson.  Unfortunately, some will see this as an indictment on the lack of drawing power for Johnson who has to be considered one of the best pound-for-pound fighters ever.

Last April’s UFC on Fox 19 drew over 2.1 million viewers.  In 2015, April’s UFC on Fox 15 drew 2.43 million viewers.

Next Page »