Ring Of Sports Marketing


FOX Offers $200M To UFC For Media Rights

Negotiations for the UFC media rights are underway and the first offer from FOX is well below what WME-IMG valued them at.  WME-IMG CEO Ari Emanuel was one of the key negotiators between FOX and UFC for the first media rights deal so he had a good idea going into this next negotiation window what the right value for the rights in 2018 should be.  However, the live sports media rights market has been cooling over the last few years as subscriptions to ESPN have decreased and people are regularly cutting the cord on their TV and going with streaming-only options.

The current agreement runs through 2018 and more offers will come in but the UFC will also be competing against other live sports options, like the WWE, which has good ratings and some overlap in demographics.  Companies like Amazon have also become a bigger player in live sports.  Amazon has media rights to the NFL and Jeff Bezos direction with the company is pointing towards creating new, exclusive streaming content that people will pay for, therefore becoming Amazon Prime members.

At the start of 2017 the media fees paid to the UFC will be $160 million, after being $115 million a year when the deal first began in 2011.

The media rights could also be for a digital only platform that Dana White has brought up recently.

Ringside Analysis:

In order for the UFC to reach its revenue goals in 2018 and beyond, WME-IMG was really putting a lot of weight into a big increase in their media rights deal.  While Darren Rovell states that even WME-IMG didn’t think $450 million was realistic, the $200 million offer in a market that appears lukewarm seems a little further below their optimistic assessment than they would like.

I’m sure WME-IMG and the UFC were looking to take their rights into the open market.  By going to the open market they probably envisioned that they could get a better deal with more competitors in the marketplace.

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