The UFC Emerges Stronger From a Dangerous Summer

by Michael Rome on Aug 17, 2008 10:37 AM EDT in News

I wrote a piece called "Zuffa's Dangerous Summer" in April, and pointed out three potential threats: 1) Affliction's first show; 2) EliteXC on CBS; and 3) Randy Couture winning his case and pursuing the Fedor fight in one of these competing promotions.

It's now August, and it looks like Zuffa will emerge from this dangerous period as the undisputed top player in the industry.

Affliction did far better than I guessed when they first announced the show, but they spent so much more money to do it that they have cut their second payroll by millions of dollars, and do not look to be a formidable threat at any point in the near future.

EliteXC is on the ropes, reeling from significant financial loss and management issues. CBS does not pay them enough for them to survive without Pay Per View, but who knows if we'll ever see that? They are not a threat, they are more like an occasional novelty act that will serve to build up names on CBS that will get better deals when they eventually sign with the UFC. Lesnar-Kimbo may be a fight we see in 2009 in the UFC. If they do survive and stay strong, they still won't be any kind of threat to the UFC.

Finally, things have not gone particularly well for Randy. The arbitrator could rule for him, but his best chance was always a Texas judge hating Zuffa's unfair contracts and allowing Randy to go elsewhere. The possibility of Couture fighting Fedor for a new promotion is the only real remaining threat to the UFC's dominance right now.

If I had to evaluate the state of the UFC right now, I would say it is excellent. They are doing strong pay per view numbers without Chuck Liddell, Tito Ortiz, or Randy Couture, the overseas expansion is now profitable, and they have a few very big fights on the horizon. The piece they need to fall into place now is a network deal on terms that are good for them, and I suspect that by early next year they will get it.

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Great observation. I sometimes fail to look back to where the ship set sail. The UFC has created some big, new players (fighters), as well as convinced me that it is okay to have a $120.00 cable bill every month. All while other organizations are flushing millions of investors dollars down the commode.

Also, Rome, I humbly admit that I am wrong about Affliction. They came in with a short-sighted, “go big or go home” plan. I shall eat crow stew while ordering my next UFC pay-per-view, and enjoy it while routing on Zuffa brand fighters. But, I will be wearing an over-priced Affliction shirt while doing so.

by Heenan on Aug 16, 2008 7:21 PM EDT 0 recs

yeah…. they will prob do over 500k on each of the domestic ppv’s from may to august….that is strong….their baseline ppv sales jumped from prob 425k up to around 500k……..

i would add Chuck vs Rashad to the over 500k crowd, but it may pull a Chuck vs Jardine number and do 475k instead…..

Mike Goldberg on robnashville:
"His analysis is so analytical"

by robnashville on Aug 16, 2008 7:25 PM EDT 0 recs

My prediction is 500-525. I think 9 months off Chuck will have fans wanting to see him, it’s not 2 weeks after a bigger free one like last time, and Rashad Evans drew shockingly well in the main event last year in November against Michael Bisping. He may be a boring fighter, but he knows how to talk trash well. I also like that they’re promoting this show as these new young stars against the old guard of Franklin and Chuck.

December will probably beat last year’s big show too. Mir-Nog will be the co main event after 12 weeks on TUF, and BJ-GSP is still the likely main event despite GSP’s recent comments. The combined unique buy bases of Hawaii and Canada combined with the obvious champ vs. champ promotion will make this fight a monster. I’ve also heard rumblings that they may try to do a multi week buildup on Spike TV leading into it, like a multi part countdown. I think GSP’s comments were more a negotiation tactic anyway, and even if he does wait until 2009, Liddell-Forrest could easily step in in December if he beats Rashad.

by Michael Rome on Aug 16, 2008 7:34 PM EDT up 0 recs

yeah…. if you read me, you know i’ve been an advocate of doing those bj vs gsp shows as stadium shows…… i would put chuck vs forrest on new years and put superbowl sunday as gsp vs bj in montreal….

i think chuck vs forrest would do 750k on new years…i know you are even more optimistic than me on that, i think you said over 800k

i know they like to do the super bowl show in las vegas, but they did a little over 7k paid last year for the brock show (but they made out like a bandit on the buy rate) …maybe that is too soon to hit vegas after the new years show, just my opinion

Mike Goldberg on robnashville:
"His analysis is so analytical"

by robnashville on Aug 16, 2008 7:50 PM EDT up 0 recs

Honestly it is maybe time to move the Superbowl show elsewhere, or move the New Years show to Montreal. Two expensive shows in 5 weeks is tough in the same market.

It’s so hard to know how Chuck-Forrest would do. I think it’s a monster, but it depends on how they promote it. With something like the HBO special it would do unbelievable numbers, but they still only do one show to promote their pay per views. I think if they attached at the end of the last 4 weeks of TUF a half hour show building either of the big fights, and then had the final countdown show a few weeks later…it would be very effective.

by Michael Rome on Aug 16, 2008 8:02 PM EDT up 0 recs

Hey Michael

I’m wondering what you considered to be the successful aspects of the Affliction show.

by LiuLang on Aug 16, 2008 9:02 PM EDT 0 recs

inb4 IT'S A TRAP

by LiuLang on Aug 16, 2008 9:05 PM EDT up 0 recs

It did upwards of 90-100,000 buys, which is far better than anyone expected. Overall it was a big failure, but it was less of a failure than I anticipated. It also did a good job setting up future fights.

by Michael Rome on Aug 16, 2008 9:19 PM EDT up 0 recs

the nest show...

Yeah they cut their payroll but their next show won’t do half those buys and won’t do half the gate of the 1st show…

by mmalogic on Aug 16, 2008 10:15 PM EDT up 0 recs

I don’t know about those numbers Jordan Breen said on his show last week it only did Between 55,000 and 70,000 at the most ???

by Shocbomb on Aug 17, 2008 7:05 PM EDT up 0 recs

It did higher. I got an estimate last week of 94,000, and Dave Meltzer recently said on his show he’s hearing now it looks like 90-100. Still, it’s the difference between losing 4 or 5 million, it’s not like it’s the difference between success and failure.

by Michael Rome on Aug 17, 2008 9:37 PM EDT up 0 recs

brother Rome gets it right...

Spot on analysis.

Also Yes Ive been saying the “star building system” the UFC has needs to evolve into a multi part countdown ala 24/7 hbo.

It should be a half hour episode after a weekly fight night.

The documentary/countdown should be based on the main eventers and co main eventers getting ready for the fight emotionally, physically, etc… from the moment they find out to weigh in.

Also it should include the Dana from how the card is put together, etc…

The title of this series should be something along the lines of: "Road to UFC ____ (number of the UFC)

I don’t believe the UFC is ready for a weekly live event infrastructure wise though.

by mmalogic on Aug 16, 2008 9:46 PM EDT 0 recs

I think they are. It only needs to be a 1 hour show anyway, 2 fights as well as interviews, videos, and news building up current events. Hold it at the Pearl or something in Vegas weekly, give the live fans some prelim fights, and put the kind of decent fights that currently go 3rd on main cards on the TV shows as main events. Something like Mac Danzig vs. Mark Bocek from UFC 83 for example would be a perfectly acceptable TV main event.

by Michael Rome on Aug 16, 2008 9:59 PM EDT up 0 recs

That’s an interesting approach… it certainly would keep costs down.

I would also want the weekly fight night main events to serve as a way to build a fighter so he can carry/add to a PPV ala what they did with anderson silva.

Also not only for building a new star but helping resurrect an old one who lost a few but has a chance to come back.

the undercard should be prospects looking to break out as contenders.

A total of 3 fights would be safe. (1 pretaped and the other 2 live) if you want a 1 hour weekly episode.

I personally believe if they do this right they can take this on the road and make it a 2 hour show.

Building brand equity wherever they go, building local stars and ofcourse selling tickets to the smaller “palm-like” venues.

by mmalogic on Aug 16, 2008 10:11 PM EDT up 0 recs

My only concern about a 2 hour live show is it ends up like a WWE situation, where you have 2 hours of live fights every week…and there’s just way less incentive to buy the PPV every month, especially when you get 4 fights the next monday.

by Michael Rome on Aug 16, 2008 10:35 PM EDT up 0 recs

The multi part countdown has to be a true cock tease where you can’t take it until you release (buy the ppv).

And this is where Branding the fighters becomes important. The UFC can do so much more to facilitate this but they don’t because it’s a conundrum…

If they can figure out how to lock in fighters where they are not tearing down and building them up depending on where they are in their contract negotiations and obviously where the fighters are taken care of…

Then every UFC fighters brand is tied to the UFC and it would be a smart investment to further that.

The UFC brand can’t be everything to everyone… but there is a fighter out there for every demographic, geographic and psychographic.

This is where niche marketing comes into play.

Right now the UFC is hesitant in GSP headlining another show in canada… why?

Because they want UFC sell outs not GSP sell outs.

If they make that his home base then he has more leverage in renegotiations and can potentially become a competitor.

This “conundrum” needs to be fixed and until it is the UFC will not be able to penetrate markets as effectively as they can.

by mmalogic on Aug 16, 2008 11:14 PM EDT up 0 recs

Maybe they could have a non-televised show each month and show a few fights each week along with interviews/previews/hype etc.

To go with your wrestling talk, make it more like old school WWF Superstars Saturday mornings as opposed to Monday Night Raw.

by Phildo on Aug 17, 2008 12:55 AM EDT up 0 recs

The problem with the WWE model is that they have their big stars wrestling every week. With the UFC, people are still going to buy the PPVs if the weekly shows are being headlined by Florian/Lauzon, Huerta/Guida, etc.

by Mike Fagan on Aug 17, 2008 12:30 PM EDT up 0 recs

I think the UFC could do well with a two hour program that has one or two live fights, mixed together with older taped fights. Marketing the big (or growing) fighters with their most impressive showings will encourage new viewers to see them on PPV. The one or two live fights on a weekly basis could be up and comers with the occasionally well-hyped fight, or a quarterly all-live card. But a weekly all-live card would be overkill. And I don’t think anyone wants to watch highlight shows or old fights every week. But a combination of all of these things as well as bio’s, interviews and hype pieces on various fighters/fights could make for a very entertaining (and profitable) program.

by Blackout612 on Aug 17, 2008 5:13 PM EDT up 0 recs

Will UFC where Networks will be paying to get it on air like they pay for the NFL? Thus, having no need for PPV?

by The Bronzeville Bully on Aug 16, 2008 11:02 PM EDT 0 recs

Well, thats a potential future, but right now they want to be paid big money for a few shows a year and do the rest on PPV.

by Michael Rome on Aug 16, 2008 11:04 PM EDT up 0 recs

yeah… the economics just aren’t there for a move away from PPV to TV on a broader scale…. they would have to get massive rights fees to offset the lost PPV cut, which isn’t feasible for the networks….

Mike Goldberg on robnashville:
"His analysis is so analytical"

by robnashville on Aug 16, 2008 11:11 PM EDT up 0 recs

I think if things keep going the way they are within the next year or two you will see the UFC put on a weekly TV show with live fights probably on spike ? Especially if all the orgs that are in trouble go under and the UFC signs alot of new fighters.The bootom line they keep building up there overall fighter numbers that they have under contract they are going to need somewhere for there up and coming ,prospects,and not so popular fighters to fight.They are not going to put
12 fights on a undercard of a ppv now. Why not take those type of fighters and try making some money from there fights and live show on spike would do just that.

by Shocbomb on Aug 17, 2008 7:15 PM EDT up 0 recs

The word is...

The word is the network TV deal they are working on is not primarily for live events :)

Let’s just say if the deal gets done expect a whole new slew of fans akin to the “tuf noobs” that emerged after the ultimate fighter.

Actually now that I think about it… it’s a genius play.

by mmalogic on Aug 16, 2008 11:43 PM EDT up 0 recs

Network TV

The UFC needs to change their thinking on network TV.

They need to be stead fast on control but lenient on monetization.

Why?

Because they spent aprx 30 mil for UFC branding.

They can get a better effect of branding by signing a network deal… so they need to look at it as advertising solidifying “Ultimate FIghting” and then figure out the proper monetary deal.

Maybe license all their overseas shows as they generally produce only 4m in PPV revenue.

2m per show to license and write the 2m off as brand advertising.

Try to schedule them a week before a US ppv where it can be promoted and you can write even more off.

by mmalogic on Aug 16, 2008 11:23 PM EDT 0 recs

That’s an interesting twist. I’m curious what they could do besides TUF, some kind of new formatted reality show?

by Michael Rome on Aug 16, 2008 11:54 PM EDT 0 recs

Tuf was based on the american Idol model.

Theyre trying to do something that will appeal to a large enough audience so it can be sustainable for at least a few years and of course a segway into live events still being relevant at the conclusion of the seasons.

The thinking is if they can create a fan base on the network for the live events through a trojan horse they can replicate the success of tuf with spike.

what would have happened if they just started out with live events on spike… probably wouldnt have been as successful.

Even with a larger fan base now post tuf every metric indicates the numbers wont add up with a network deal long term.

I’m hearing Hughes will probably be involved.

by mmalogic on Aug 17, 2008 12:22 AM EDT up 0 recs

I don’t think the UFC needs a TV deal anymore. They are in the PPV business just like Dana has said. I also heard him say that signing with a network is practically signing your company away.

by steveoc24 on Aug 17, 2008 1:52 AM EDT 0 recs

hey Michael,

i was wondering why the ufc doesnt put the lhw belt on the line in november and instead are waiting for maybe next year for forrest to defend his title?

is it becuz the ufc is hoping for a liddell-griffen match up?

and wen do u think is gonna be the next time that they might put it? (other then maybe december)

by bigislandboi808 on Aug 17, 2008 6:14 AM EDT 0 recs

They want Liddell/Griffin. Plus, who could he defend against? All the contenders are tied up. Rampage won’t be getting a shot until his legal problems are cleared up, Wand is 1-3 in his last four fights, and Machida is fighting the month before.

I think it will be Liddell/Griffin in February at the superbowl show if he beats Rashad.

Regarding Mir and Nogueira, I think they want to wait until TUF is over to have them fight, but I agree they should be on the November card which currently has nothing.

by Michael Rome on Aug 17, 2008 2:28 PM EDT up 0 recs

Oh, ok great news. :)

Thx for replying :)

by bigislandboi808 on Aug 17, 2008 7:52 PM EDT up 0 recs

Oo i just thought of a scenario…

You know when GSP said he would like to take the rest of the year off and stuff….would the ufc do a lw title defense for bj with kenny at the new years show…and if he wins that then maybe a superfight in hawaii?? (assuming the ufc is coming to my home state next year) :)

Just a thought lol.

by bigislandboi808 on Aug 17, 2008 8:01 PM EDT 0 recs