Ring Of Sports Marketing

Posts tagged ufc

Boxing

Mayweather-McGregor Earns 4.3 Million PPV Buys in US

Showtime has announced that Mayweather-McGregor earned 4.3 million PPV buys in the US.  The network also stated that the fight generated $600 million in total revenue.

The 4.3 million figure is well below what Dana White has stated in the past, which means that the 6.5 million buys White references must be including international buys.

Mayweather-McGregor is second to Mayweather-Pacquiao with PPV buys, MayPac generated 4.6 million buys, and gate revenue, MayPac generated $72,198,500.  Mayweather’s fight with McGregor on August 26th generated $55,414,865.79 in sales.

Showtime exec Stephen Espinoza told ESPN:

“The pairing of Floyd Mayweather and Conor McGregor brought together two very significant and distinct global fan bases in one truly unprecedented event… The remarkable results are all the more impressive considering that the planning, marketing and execution took place across a span of just 72 days from the initial announcement to fight night. Together Showtime and Mayweather have now accounted for the three highest grossing pay-per-view events of all time.”

Ringside Analysis:

The primary goal of this fight was to make everyone involved a lot of money.  Mission accomplished.

The marketing for the event included a world press tour that got ugly at times, an All Access series that has always preceded Mayweather fights aired on Showtime, and plenty of commercials on sports networks.  What is unique about this boxing event is that the UFC also helped sell the event.

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MMA

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.

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Boxing / UFC

Dana White Says UFC Could Begin Promoting Boxing

On the same podcast that Dana White said that the future of the UFC’s broadcast rights could be on a digital platform, the President of the UFC also said that one day boxing could be under the umbrella of the UFC.

Rumors first began that Dana White was going to expand into boxing last summer.  While promoting Mayweather-McGregor, White wore a shirt that said “Zuffa Boxing.”  White said that he has no plans to leave the UFC because it is his passion.  He also says that he is still under contract and can’t leave per the rules in the contract for WME-IMG acquiring the UFC.

Ringside Analysis

Dana White is a former amateur boxer, boxing trainer, and boxing fan.  When he partnered with the Fertitta brothers to take over the UFC and push it to its $4 billion sale he thought he could make a fight promotion company that avoided the mistakes boxing did.  He has already begun to obtain a promoter’s license.

Some believe that this is a sign that White and the UFC think that the market is softening on MMA and it is time to expand into something that is going to be more lucrative.  I view the expansion into boxing as a way to promote fighters in forms of martial arts they have mastered and also into new revenue streams.  While MMA may be a more long-term mainstream sport, the UFC could also expand into niches like boxing or muay thai.  Mayweather-McGregor has shown that there is a strong desire for cross-over competition if the personalities are right.  In a way, the UFC could really be moving back to its roots of matching wrestlers with kung fu masters.

The UFC is expanding into its first fight in mainland China at the end of this month, is looking for a big increase in revenue for their next broadcast rights, and are getting more international sponsors than they have before.  What the UFC is today could be a fraction of what it is in the next 10 years.

Entertainment Business / UFC

Next UFC Broadcast Deal Could Be a Digital Platform

On The Unnamed Podvideocast with Jason Gay, Dana White said that instead of going with a traditional network for the UFC’s next broadcast deal the MMA company could instead use a digital platform.  White says that with the declining subscriptions to ESPN and seeing his own kids prefer digital devices to television that the future is with digital, over the top (OTT) platforms.

Dana White says:

“I think where you really see it is, look at ESPN… Look at how powerful ESPN was five years ago, what they were getting per sub. Their subs are dropping. They’re scrambling to figure it out right now.”

“There’s no doubt that the internet and OTT is where it’s all going. So, it’ll be interesting to see when the smoke clears who’s still around and who’s not.”

ESPN once considered buying the media rights to the UFC and was rumored to be interested in buying the UFC before WME-IMG, but decided to pass.  The World Wide Leader in Sports has also been aggressively pushing its own app with a streaming service starting in 2018.  The ESPN streaming service will feature Top Rank Boxing.

The UFC already has an OTT service called Fight Pass but this new service would be much more comprehensive in terms of live events.

A distinction between the UFC and other organizations like the NFL is made on the podcast.  The NFL doesn’t produce its own events.  Networks like FOX and CBS produce the events for broadcast.  The UFC produces all of its own events regardless of whether a given event is for PPV or if it is for Spike.

Ringside Analysis:

Every sports organization from the MLB to the NFL to NCAA Football is looking for ways to speed up games and make them fit into a smaller, more convenient time frame.  Very few people have enough time for three and a half hour football and baseball games.  Dana White says that the UFC is one of the best positioned sports for the future:

“Fighting, it works everywhere, all across the planet,” White said. “Now with technology, we’re getting to the point I always dreamed about. I always used to say, ‘We’ll take this thing all around the world, build a fanbase, build some talent in every country around the world and then we’ll get to a point in time where everybody can watch it at the same time — on the same platform.’ We’re getting to that day.”

The UFC may look to split up broadcast rights to traditional distribution channels, like television, and digital streaming.

 

Ratings / UFC

Stephen Espinoza and Showtime Show Interest In Partnering with the UFC

Showtime Sports Executive VP and GM says that he will be reaching out to the UFC about being broadcast partners.  The UFC’s broadcast agreement with FOX is coming to a close and if the network and the UFC cannot reach an agreement on a new broadcast deal then companies like CBS, Showtime, HBO, or NBC may bid high enough to be the main broadcaster in the future.

Dana White was critical of Showtime with how it handled Strikeforce but praised the network after the UFC and Showtime worked together on the Mayweather-McGregor fight.

Ringside Analysis:

Showtime and HBO use boxing to get subscribers.  The new subscribers who want to watch a fight hopefully end up finding a new favorite TV show or the movies that the network airs and eventually become full-time subscribers.  However, while Showtime and HBO pay the promoter for the rights to each fight, making for an easy revenue stream for the promoters, it limits the exposure of the fights and fighters.  Because people have to pay extra to watch a fight it is likely that most will opt to watch a basketball or baseball game on ESPN, a channel they already get, instead of paying a monthly fee for a new, premium channel.  Maybe Showtime will get the more popular fights on their network, but that would probably require a hefty price tag.  CBS would be a big player to help promote the UFC but access to the network may not be in the cards for this broadcast agreement.

UFC

Conor McGregor Won’t Fight Again In UFC Unless He’s Co-Promoter

UFC Lightweight Champion Conor McGregor has not stated whether his next fight will be a MMA match or a boxing match, but before he does another fight in the UFC he demands to be a co-promoter.  At the debut of his biopic, McGregor was asked about his next fight.  He said that Tony Ferguson was a likely opponent in the UFC but also that a few boxing matches were possible and that discussions were open.

Conor McGregor said:

I was promoter on the Mayweather fight, and we’re in current negotiations… I ain’t stepping in that octagon again unless I’m part owner of the whole setup – I’m a promoter.”

“We’re in the contract negotiation stage. It’s got to, they’ve got to entice me now because, I came from a billion-dollar fight. I want equity, I want pay-per-view. I want to be a true partner. You have to entice me now. I want to be a partner. I want to be a promoter and I want to be a fighter for me to continue.”

Conor McGregor has asked for part ownership in the UFC before.  When the UFC was first sold to WME-IMG he wondered why he was excluded from any ownership in the company while WME-IMG sold off shares to celebrities in other sports and entertainment, like Tom Brady.

McGregor was technically a co-promoter in his fight against Mayweather but Zuffa later was legally required to be listed as a promoter in the fight so that they could pay Conor McGregor.

Dana White responded saying:

Dana White basically says that Conor McGregor is such an international draw that they are going to make some exceptions for him.  White also says that Conor McGregor is easy to do deals with and is also a huge asset to the company because he is willing to fight anyone at nearly any time.

Ringside Analysis:

I don’t think in an ideal world that the UFC would ever have a co-promoter because they don’t want to put any other company on par with the UFC.  The UFC has placed a lot of emphasis, especially since Zuffa first bought the company, about establishing the UFC brand.  The UFC is nearly synonymous with MMA but acts more as the NFL.  NFL Commissioner Roger Goodell said that one of his responsibilities is to “protect the shield” and the previous owners, with White, defended the UFC passionately.

The UFC has made exceptions for Conor McGregor before.  In the past the UFC hasn’t let fighters compete outside of the UFC in other sports but they let McGregor fight Mayweather.  McGregor made a lot of money for himself, WME-IMG, and also did a lot of promoting for the UFC.  The UFC had a rule against fighters holding belts in two different weight classes.  Conor McGregor won the UFC Lightweight Championship while simultaneously holding the UFC Featherweight Championship.

Part of me is wondering if the UFC is killing the golden goose by giving so much power to McGregor.  It is unlikely, but certainly possible, that the UFC is giving Conor McGregor what he wants because now McGregor knows how much money he could be making boxing or fighting as an independent MMA fighter and running his own shows, taking fighters from other MMA promotional companies.  The UFC has been behind in revenue goals for the last year and I hope that the short term money they’re chasing now, which remind me of some of the mistakes boxing made in its decline, don’t hurt the long-term success of the UFC.

Sponsorships / UFC

UFC Signs First Official Airline Partner with AirAsia

The UFC has announced a new partnership with AirAsia.  The sponsorship agreement is for multiple territories, leaving open the possibility for other airline partnerships in different parts of the world.  AirAsia will do their first activation on November 25th when the UFC has their first event on mainland China.

AirAsia was founded in 1996 and is a low-cost carrier based in Malaysia.

UFC Vice President of Asia-Pacific Kevin Chang said in the press release:

“This deal is an indication of how much UFC and the sport of mixed martial arts have grown in Asia and around the world… AirAsia is an innovative and fast-growing brand, we thank them for the support and we’re looking forward to creating engaging branded content for fight fans and AirAsia customers to enjoy.”

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Sponsorships / UFC

Modelo To Replace Bud Light as Official Beer Sponsor of the UFC in the US

Image result for modelo beer

The UFC will start a new, multi-year sponsorship deal with Mexican import brand Modelo Especial as the new official beer of the UFC.  Modelo will replace Bud Light who was the first major sponsorship agreement for the UFC nine years ago.

UFC COO Lawrence Epstein said this about the partnership with Bud Light:

“When Bud signed on to be our sponsor, it sent a significant message that UFC was a real player in the sports landscape…  It gave us a tremendous amount of credibility with other sponsors. And not just sponsors. Television networks and venues and, frankly, anybody involved in the business of sports entertainment around the world.”

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MMA / Sports Law

Conor McGregor May Speak to US Congress on Extending Ali Act to MMA

Conor McGregor is only a few weeks away from the richest fight of his career and is now supposedly going to speak to Congress about extending the Ali Act to MMA Fighters.  Congressman Markwayne Mullin has been told by Conor McGregor’s team that McGregor is going to go to Capitol Hill and advocate for passing a bill that would help give greater transparency to the financial information in MMA in order to better protect MMA fighters.

The Ali Act was passed in 2000 and is designed to help protect fighters through financial transparency, tighter regulations, and help maintain the integrity of the sport.  One of the cornerstone parts of the Ali Act is that it protects fighters from “coercive contracts.”  Other key parts are aimed to separate promoters from the managerial process of the sport.  Boxing has rankings determined by independent commissions and promoters are not able to have a “direct or indirect financial interest in the management of their fighters.

Ringside Analysis:

UFC COO Lawrence Epstein gave commentary on the article written by Telegraph Sport.  Epstein says that the UFC exceeds any requirements when it comes to the health and safety of fighters, which is certainly true.  The UFC uses USADA for testing for performance enhancing drugs in athletes, which boxing as a whole does not, (Although some fighters require that their opponents undergo extensive testing with USADA) and the UFC has invested millions into a new performance training center near corporate headquarters in Las Vegas to help reduce the number of injuries that fighter sustain during training.

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Regulations / UFC

UFC and USADA Release New Anti-Doping Policies

The UFC has changed the USADA drug testing process for a fighter entering into the UFC after willingly leaving.  Previously, a fighter only had to be part of a drug testing pool for four months leading up to a fight.  The new rule now states that a fighter must be in the drug testing pool for at least six months.  There is still an exception to this rule.  The exception can be applied by the UFC for, “exceptional circumstances or where the strict application of that rule would be manifestly unfair to an athlete.”

Athletes who willingly left the UFC, for professional reasons or retirement, will have to wait the full six months.  Athletes who did not leave the UFC by choice or are entering their first UFC fight only need to be in the pool for a month.  Jeff Novitzky, UFC VP of athlete health and performance told MMA Fighting:

“The majority of these changes are athlete driven.  Early on in this, we knew there had to be a balancing act between the strength and comprehensiveness of the program and the fairness to the athlete. Over the year and half, this program has been in existence, we have consistently encouraged feedback from fighters and camps about how to make this program stronger, more comprehensive and, just as importantly, fairer to the athletes. All of these changes are a result of that interaction and feedback from athletes and camps.”

The timeline for when fighters are in competition has now been defined as beginning at noon the day prior to the fight and ending once the fighter has taken his post-fight drug test.  Nate Diaz forced a clear definition after he said he was using cannabidiol oil at a post-fight press conference.

One other policy change is that a fighter who is appealing a ruling has a conference call with an arbitrator rather than having an evidentiary hearing.

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