The Sports Business Journal reported last week that the UFC brokered a deal with online slot machine maker Endermol. The deal licenses fighters’ likenesses and fight footage from the UFC on slot machines.
The UFC sees this as a good extension of its brand that may expand in the future.
Via the Sports Business Digest:
Endemol Games is a subdivision of Endemol, a Dutch-based television company known for various American television shows including Deal or No Deal and Extreme Makeover: Home Edition.
The deal creates a new revenue stream for the UFC, with the company receiving revenue on a flat licensing fee plus a percentage of the game’s handle, should certain net profit incentives –$1 million dollars annually — be met.
Payout Perspective:
This is an interesting extension of the UFC brand at this point in the company’s history. Its gone mainstream with the Fox deal and the brand is in front of more eyes than ever before. So why is it licensing its brand out to a gambling establishment? It does create a revenue stream outside of its PPV model which can only help the company. The Fertittas are familiar with the gaming industry so they would understand the market and revenue it could earn if it licensed out its brand. Also, the slots will likely appeal to the 18-34/49 demo the UFC covets. If the business picks up, we can see UFC slots in the US.
Don’t a lot of UFC events take place in establishments that feature row upon row of slot machines?
In the UK (where gambling is nationally legal), a number of slot machines are placed in pretty much every pub/bar/club as well as plenty of other establishments, particularly betting shops (of which there are usually 2 or 3 in every town). So the market is broad. Also, it seems MMA has gained a strong following in gambling circles, as Sky sports’ (the UK’s biggest sports broadcaster) coverage of UFC on their website pretty much stems from their ‘Sky bet’ gambling portion of the site. So it seems they are trying to push the UFC as a betting sport in the UK, and maybe throughout Europe.
Thw strange thing is the timing as Endemol is in violation of their loan covenants and will either be sold at 50 cents/$ (time warner deal) or transferred to debtholders in a debt for equity swap. There are plenty of articles out there on this is anyone is interested.
As a stream, it is as good as any. Wife likes the slots and they have all orts of themed ones now (monopoly,, wheel of fortune, etc ) so a UFC one would not be out of line. Key would be if they can sell the machines to casinos.