Welcome to another edition of Payout Perspective. This week we’ll be taking a look at the business side of UFC 106 which was held on Saturday, November 21st at the Mandalay Bay Resort & Casino in Las Vegas, Nevada. The event featured the Octagon return of Tito Ortiz as he took on Forrest Griffin in the light heavyweight main event.
UFC 106 by the Numbers:
Attendance and Gate Figures
The announced attendance for the fight was 10,529, which drew a live gate of approximately $3 million (an updated figure should be available from the NSAC in the coming days).
Disclosed Fighter Payouts
- Forrest Griffin, $250,000 (including $150,000 win bonus) def. Tito Ortiz, $250,000
- Josh Koscheck, $106,000 (including $53,000 win bonus) def. Anthony Johnson, $17,000
- Amir Sadollah, $30,000 (including $15,000 win bonus) def. Phil Baroni, $25,000
- Antonio Rogerio Nogueira, $100,000 (including $30,000 win bonus) def. Luis Arthur Cane, $19,000
- Paulo Thiago — $16,000 (including $8,000 win bonus) def. Jacob Volkmann, $6,000
- George Sotiropoulos, $20,000 (including $10,000 win bonus) def. Jason Dent, $8,000
- Caol Uno — $20,000 (no win bonus, majority draw) def. Fabricio Camoes, $10,000
- Brian Foster, $12,000 (including $6,000 win bonus) def. Brock Larson, $26,000
- Kendall Grove, $44,000 (including $22,000 win bonus) def. Jake Rosholt, $15,000
- Ben Saunders, $20,000 (including $10,000 win bonus) def. Marcus Davis, $27,000
Disclosed Fighter Bonuses
- Fight of the Night: Josh Koscheck vs. Anthony Johnson ($70,000 each)
- Knockout of the Night: Antonio Rogerio Nogueira ($70,000)
- Submission of the Night: Josh Koscheck ($70,000)
MMAPayout.com PPV Buyrate Prediction
A weighted average statistical regression analysis of two different variables – viewership in Countdown to UFC and live gate revenue across 30-40 events – was used to derive a linear equation that allows us to input UFC 106’s respective Countdown (445,000) and live gate ($3 million) values in order to determine an expected buyrate figure for the event:
- Countdown Prediction: 340,000
- Live Gate: 555,000
- Weighted average: 447,000 buys
There are some rather large discrepancies in the pre-fight indicators – more so than normal – and I feel that’s largely because of the rapid fight changes that have plagued the card. UFC 106 was supposed to be another 1 million+ card for the organization given Lesnar-Carwin and Ortiz Griffin, which is why the gate fared so well (early buyers anticipated watching Lesnar defend his title). However, the Countdown to UFC figures showed a very low level of interest in the fight (445,000 is the second lowest Countdown total of the year for the UFC).
It’s really tough to get a gauge as to exactly how popular both Forrest and Tito are right now. Tito is coming off an 18 month layoff, but is one of the more charismatic sellers in the fight game. Griffin is coming off an embarrassing loss, but he’s got a remarkable amount of support within each event itself.
At this point 340k seems a little low, but anything in the 400k range wouldn’t surprise.
Business Story Lines:
– Griffin rebounds with split over Ortiz: It was a genuinely entertaining fight between two veterans looking to rebound and get their careers back on track. The series is even-up at 1-1, and the close, split decision nature of the fights almost demands a rematch between the two at some point. The crowd reaction to both fighters was interesting. Perhaps three or four years ago Ortiz would have had the support of the crowd, but Griffin seemed to be the more popular choice among fans in the arena and at the bar (save maybe in Huntington Beach).
– Koscheck and Johnson in strangest fight of the year: Johnson looked to have Koscheck on the run before delivering a knee to Koscheck’s head while he was on the ground. Koscheck fell over in agony, despite the replays suggesting that there wasn’t as much contact with Johnson’s knee as it might have seemed. Johnson was later the recipient of a few solid eye-pokes (most will recall his first fight against Kevin Burns where he was poked and dropped to the mat, at which point the ref called the fight).
It’s a little surprising that this fight was given FON honours – there were probably more entertaining bouts on the card – but it seems like there could be some political elements to the decision as it helps to smooth things over with the Koscheck and AKA camp (and reward the guy for stepping up on short notice so often).
While not a dive, the Koscheck knee did seem to be an embellishment. It’s not serious – Koscheck isn’t known for that type of behaviour – but from the perspective of a sponsor, it does bring to light the issue of accountability. These fighters are, in many cases, being paid a lot of money by sponsors, and they must be mindful to represent them in a responsible manner. It’s largely an issue MMA has been able to avoid, but as the sponsorship dollars continue to increase over the next few years, it’ll definitely be a point of contention for sponsors considering the reputation MMA has in some mainstream circles.
– Ortiz, Griffin for TUF?: The rumours have been swirling for the past few weeks about who might be asked to coach the next season of The Ultimate Fighter, and at the press conference Ortiz openly expressed a willingness to coach against Forrest on the show. It’s something the UFC will probably strongly consider, because the TUF show would help to hype a rubber match, Ortiz and Griffin would add two great personalities to the show, and it would be one of the rare instances where the series doesn’t tie up a UFC division for 8 months.
– Prospect Watch:Amir Sadollah, Brian Foster, and Paulo Thiago picked up victories and each looked pretty impressive. Thiago is probably the furthest along (having already beaten Josh Koscheck), but Foster managed to stop Brock Larson despite being fouled twice. However, Sadollah probably has the best to be the most popular fighter of the three – he’ll need a few more fights at the middle level of the division before he contends, however.
Anthony Johnson and Jake Rosholt performed reasonably well in each of their bouts but failed to pick up victories. Johnson and Rosholt both have a lot of potential, but are fairly one-dimensional fighters at this point. Johnson, in particular, is dynamic enough to be a significant draw if he can hone his skills (and develop some take-down defense).
– Various fighters wearing various UFC jocks:Paulo Thiago, amongst others, were wearing what appeared to be UFC branded jocks under their shorts. It leads me to wonder whether this might be the start of a further merchandising expansion into the equipment side of the business – something that would coincide well with the opening of several UFC Gyms in 2010.
The idea that the UFC could not only start its own line of gyms, but supply its clients with workout equipment, has the potential to be a serious revenue stream for the company. Moreover, the side benefits are enormous: the gym is a teaching tool and 24-7 advocate for the sport, and the equipment can further cement the UFC as the MMA brand.
– UFC 106 puts on a solid night of fight:the expectations of most were fairly low for this event, largely on account of Lesnar-Carwin being dropped from the card. As a result, the fights simply spoke for themselves. There were a mix of decisions, submissions, and stoppages that created a solid night of entertainment.
It was nice, for a change, to watch an event just for MMA, and not because it was the make or break of something.
The UFC with a lot more merchandise and the gyms?
Remember the XFL, people.
The moral is to stay with what you know.
It was a good event for a salvaged event.
It was an above par UFN card, not exactly a PPV card. I predict a 450K buy rate as well, possibly as high as 500K.
p.s., i think we’ve seen peak UFC in 2K9. With the video game, Ufc 100, the emergence of brock. it will be tough for them to match this year in 2010.
PG:
I don’t disagree in many ways, but it’s not as if the UFC is jumping into foreign territory here. They’re making reasonable line extensions within the MMA industry that, regardless of their direct effect on the bottom line, should further the UFC as *the* MMA brand.
There are some 26,000 martial arts training centers in the US, and the enrollment is growing – not just in males but females. The UFC is partly responsible for that, and should make an attempt to leverage their position in the market to capitalize on that growth.
The UFC poker, on the other hand, isn’t something I’m very keen on, but we’ll see how long that lasts. I think they’re in a place right now where they can afford to experiment. They just have to pick their spots.
It was a very entertaining card, one I watched with about 6 casual fans and they all really enjoyed the fights. It shows what depth in an organization can do, considering the UFC had to scramble a few times to finalize the card.
It really amazes me with all the talk about the UFC “peaking” in 2009. At the end of the day they may have peaked, but they have one major card to play to see if they can push to the next level and that’s a network TV deal, especially if that deal is with ABC/ESPN. They will get a huge push if that happens, now maybe it is a niche sport that peaked, but a network deal will give it a big chance to push it to a whole new level. I think a perfect main event for a network debut would be Tito/Forrest III
Hi Stan,
There is obviously room for growth in international markets, but I’d be a bit weary to think they are making the type of percentages oversees as they do in NA which makes you wonder why they even venture of shores – maybe to sell T-Shirts? PPV is their core revenue and I don’t see that changing.
As for a TV deal, they’ve tried so many times and failed. From what I understand this is due to their inability to release some of the creative control. The big 4 are not going to sign a deal with the UFC that does not make sense. Especially if its for 5 million viewers (CBS/Strikeforce). Without Kimbo, the UFC’s numbers on SPIKE are pretty lackluster. Without Brock, they have no one else to sell on major TV.
I do make some assumptions about a network TV deal, but your making the same assumptions that Zuffa is never willing to change their business model. Obviously to this point they haven’t been willing to give up certain things or a deal would be done, however, I find it hard to believe they will just sit on the sidelines if their business starts to stagnate or drop for a significant amount of time.
As far as nobody to sell, well, that’s part of the reason of signing a network deal, you use their marketing and increased exposure to build new starts. Fedor had little success breaking into the U.S. market through the PPV model and limited exposure on the FSN PRIDE highlight show, but with CBS they were able to introduce him and a basically completely unknown in Rogers and they produced good ratings.
I find it hard to believe that with effective marketing the UFC and a network, say Fox or ABC/ESPN couldn’t promote the hell out of Randy, Chuck if he comes back, Forrest, Carwin, Machida, Shogun, etc. and make them interesting to the public.
The Kimbo phenomenon is what it is, it is basically impossible to duplicate and I think the UFC did the smart thing in taking advantage of it with TUF and in the future with a UFN or two.
We will see, this is an important stretch for the UFC to weather and see if they can grow.
I think an important part in a UFC network TV deal may be how well a 2nd Strikeforce show on CBS does. If CBS is able to build on the first show and gain ratings in important demos then it puts more pressure on other networks to add a MMA promotion and gives the UFC more leverage in keeping more control. However, if the ratings stay the same or drop then MMA becomes a little less desirable to other networks and the UFC finds itself in a similar position it is in now.
sorry about some of the typos, ripped it off quickly and didn’t proofread!!
good post stan, i agree
i think the ppv buys of ufc 100 is rigged..its really below 1 million..