Dave Meltzer: UFC 108 Estimated at Roughly 300,000 Buys
by Michael Rome on Jan 25, 2010 12:58 PM EST
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Early reports of the UFC 108 buyrate based on trending patterns were overly pessimistic. In this week's Wrestling Observer Newsletter (subscription only), Dave Meltzer reported that the show pulled in an estimated 300,000 buys based on early numbers rather than trends. The numbers come from cable companies and are more accurate than the trending numbers.
If this number holds up, it means the show did the numbers most experts expected it to do ahead of time. The week of the event I gave myself a pretty large margin for error, predicting the buyrate would fall between 260,000 and 325,000 buys:
This is truly the show that will test the North American base number. My suspicion is that the base is somewhere around 300,000 buys, which is still a healthy number, but hitting that base over and over again will push it lower. The only hope for a decent number is Rashad's popularity coming off the reality show, but I'm hard pressed to see this doing better than 325,000, and I wouldn't be surprised if it dipped as low as 260,000 buys.
After UFC 108, Dana White crowed that critics were proven wrong. He also claimed the show would do between 400,000 and 500,000 buys. Of course, nobody can tell ahead of time if a fight like Joe Lauzon vs. Sam Stout is going to be a standard lightweight decision or a shockingly exciting fight. People can tell ahead of time though that nobody is interested in that fight and that the numbers will be as low as the company can possibly do in North America.
I wrongly predicted the show itself would be boring--it turned out a lot of the fights were exciting. But I was correct about the fact that the card was dreadful from a public anticipation standpoint, and would draw the worst North American number in a long time. Fightlinker put it best: sometimes the prelims on a show end up being particularly exciting, but that doesn't mean the UFC should charge $50 to see prelims on PPV.
The number for UFC 109 will be very interesting. There is already a pretty good amount of press coverage for Randy Couture vs. Mark Coleman and the fight is two weeks out. The show will benefit from the long gap since UFC 108, but at the same time Randy is being asked to draw a buyrate with no help whatsoever. Mark Coleman has never drawn a big number in North America, and there's nobody else on the card that resembles a draw.
Will fans be sold on the idea of seeing two active UFC hall-of-famers fight? My guess is the answer depends on how much Mark Coleman decides to ham it up on the countdown show. If he antagonizes Randy and says some of the things he's said in the past about Couture, the fight could end up being a pretty decent draw.
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even with all those injuries,
I guess the UFC sky still isn’t falling yet.
by Anton Tabuena on Jan 25, 2010 12:03 PM EST reply actions 1 recs
Wow
Didn’t Affliction go out of buisness?
by KING FEDOR on Jan 25, 2010 1:59 PM EST via mobile up reply actions
I don't understand
how it takes so long to get the actual buyrate. Shouldn’t the PPV company know immediately how much they sold?
Does anyone one have more insight into the process and why we have to go through all these projections without knowing the real numbers?
Goldie: "Michael Jordan-esque in his grappling skills is Travis Lutter."
Rogan: "No, no he's not. No."
you can still purchase the PPV through your cable provider in the weeks after the event, though I assume the majority of sales occur on the actual night. The other answer is that the UFC may not want to release actual buy rates, especially for low-sales shows.
by Graven Image on Jan 25, 2010 12:26 PM EST up reply actions
We are talking stone age technology. Cable companies mostly suck . They might even float the money and delay payment as part of the contract. Also, this is not just one company. It is many companies, a few big players being cox, comcast, directv, dish, but the dirtobution company has to gather all the numbers and the money could be delayed at any stage.
Some people think I am a dumb, ugly human being, but really I am a beautiful ape, with exceptional verbal skills.
This card was the BEST example as to why people buy the UFC brand and not the fighters. While big draw fighters will cause the cards PPV buys to increase, a larger fan base is interest in the “UFC”. This is what Dana and company has been hoping for. We can only hope they push bigger and better cards now that they have an addicted base of 500,000ish.
If they fail on the bigger better cards, they will see their numbers sink slowly causing MMAsup and smoogy to have orgasms of joy. When and if this happens, that is when the number 2 promotions needs to strike.
I wish we had a Friday Night Fights MMA version on ESPN.
Well yeah, a fight card without even a single fight people care about would be a real stinker. Things would have to be real, real bad if they can’t come up with a single interesting fight.
If 108 was the UFC desperately scraping the bottom of the barrel, well, that’s pretty good.
"an excellent example of why most MMA "journalism" is a joke. Pseudonyms like "toxic" and shitty writing like that dopey article"--- Joe Rogan.
As for 109
The show will benefit from the long gap since UFC 108
This and more so since I skipped buying the 108 PPV. Its been nearly two months.
The fight card as a whole looks more appealing to me (largely thanks to Maia and Marquardt) even though I would argue the main event looks worse than 108.
I feel the same about the main event.
Randy will hump Coleman and Coleman will be too tired to get up. Sounds exciting.
For these numbers
“The numbers come from cable companies and are more accurate than the trending numbers.”
Which actual cable companies do these come from? I don’t think the sourcing for these numbers is at all clear.
by Jonathan Snowden on Jan 25, 2010 12:51 PM EST reply actions
Sure, that is the most logical answer….
by Jonathan Snowden on Jan 25, 2010 3:07 PM EST up reply actions
It would be interesting to know roughly what the UFC considers “break even” for a PPV show – 250,000 buys? This question is complicated because there is an oppotunity cost to hosting a show on PPV — yes you get $50 a pop but you lose any advertising revenue you might have received from Spike (depending on how that deal’s structured) and you might cannibalize (a likely limited number of) future buys since someone plunking down $50 for 108 might not have the budget to buy more than a couple fights a year. There is also, I imagine, more of a risk that if the show fails future PPV efforts will be hurt. Since the fights were entertaining, that probably isn’t the case here however.
To be clear I’m not using “break even” in the sense that you’re making enough money to cover operational costs (fighter salaries, advertising, etc.) but rather I mean it in the sense that “breaking even” implies an expected positive NPV.
oh no he di-in't. I can just imagine Iverson "we talkin' bout net present value"
somebody break out their HP 10-b II financial calculator.
Goldie: "Michael Jordan-esque in his grappling skills is Travis Lutter."
Rogan: "No, no he's not. No."
lol
Perhaps in an alternate universe where Iverson is an i-banker at GS.
by The Darkness on Jan 25, 2010 2:55 PM EST up reply actions
Opportunity Costs is spot on…
It’s kind of pushing it with 13 ppv shows a year which is pretty much the ceiling in volume on ppv events- so if you only have 13 “opportunities” to bank on (ppv being the largest revenue producer currently) then yes, you lose big time in opportunity costs every time you put up a sub par card.
Some think “oh, if Zuffa does decent numbers with no-names then that will only encourage them to keep delivering shite”… when in reality that it doesn’t work like that. If Zuffa can do decent numbers with rubbish then will do great numbers with Filet Mignon. And when you only have 12 or 13 “tables” you ONLY want to serve Filet Mignon if you can help it.
by mmalogic on Jan 25, 2010 2:28 PM EST up reply actions 2 recs
and you want to upsell those tables
on full bottles of wine and dessert.
Follow me on Twitter @KidNate
And good wine, not those cheap blush wines.
"I see him beating Anderson Silva. I see him picking him apart. Him at a 131 years old...(trails off)." - Tito Ortiz on Vitor Belfort at Affliction:DOR
by Rundownloser on Jan 25, 2010 6:27 PM EST up reply actions
The problem with this is there’s more to it. Zuffa wants to expand to X number of countries and do live events there. Unfortunately they don’t have a television platform for those events, so the amount of PPV shows they can do per year before oversaturating the market is a smaller number than X.
Example:
Zuffa this year wanted to do 5 UK events. But with Abu Dhabi and Australia on tap, it looks like we won’t see a UK event until the summer. The Ireland event in January was cancelled due to lack of stars. If a show like this did 450-500k buys, we would see all 5 UK events this year with watered down cards. The only thing holding them back from doubling the amount of cards so they can go all around the world is the PPV buys issue.
by Michael Rome on Jan 25, 2010 2:50 PM EST up reply actions
When you say they don’t have a television platform for those events, do you mean that they don’t have a cable (or the equivalent) channel to broadcast the show on? Just wondering.
I wonder whether the UFC might consider a strategy where they showcase only local (non-established) fighters in markets they want to penetrate, e.g., mexico and the philippines, and broadcast it over the Internet on HDNet (or something like that) to avoid the problem you raise (to the extent I understand the issue) and also problems with PPV cannibalization. They could do this through a sister organization (the equivalent of a Strikeforce Challengers). This would allow the UFC to gauge a country’s interest in MMA, build up interest in MMA and possibly develop prospects.
I know that they were considering branching off and doing TUFs (I believe) in other countries. I thought that this could be an effective strategy although they’d need to tailor the show to fit the interests of whatever country it was being based out of.
by The Darkness on Jan 25, 2010 3:14 PM EST up reply actions
Sure, market realities always improves the product. The UK events werent going to be ppv though. Nobody believes the market can bear 24 ppv events a year, the increase was going to be free – the current deals more than make enough to cover it. The problem is they realized even if it’s free and it’s a numbered show on on a saturday night it almost has the same negative effects (and obviously the injuries didn’t help).
The UK shows will end up being fight nights on a weeknight. A numbered show in the UK at this point doesn’t work. All the big boxing fights from the UK (calzaghe, etc… come to the US) One big ppv event a year in the UK (UFC 110 or 102 type of quality) could work… but the rest have to be fight nights and ideally on a weeknight.
Unless you’re breaking into a market a numbered show makes little sense and Zuffa is improving the product and the plans to conform to these market realities.
In the perfect world the shows would not have hurt the 13 ppv’s and you could do another 12 big numbered events and give it away free on saturday night… and it would have been good for everyone because eventually – where TV programming is headed – Zuffa will be a subscription model so the more content the better.
If a fight night doesnt fit and it still needs to be on a Saturday night then a new brand needs to be developed so the ppv brand doesn’t get further watered down.
Either a new brand needs to be developed that fits inbetween UFC numbered events and fight nights to serve this purpose or fight nights will have to make do for now.
In terms of Gate Action – Canada can bear 4 major events a year, Same with Las Vegas, MSG can do at least one, Boston, Australia… pretty soon you’re gonna have to do alot of major events just to keep up with the demand at the Gates. Unfortunately this doesnt lend itself to a ppv model… a Network TV model – maybe but risky… a subscription model – yes, either as an isolated product or part of a package (comcast, etc…).
Comcast just launched “TV Everywhere”. This is a glimpse of the future. Spike, NBC, ABC, etc… will mean nothing. Whoever owns the content will mean everything. The same way paper has become obsolete to disseminate news, The platform for Network TV, Basic Cable, and Premium Cable will follow suit.
by mmalogic on Jan 25, 2010 4:04 PM EST up reply actions 1 recs
My back of the envelope calculations:
300000 buys x $45=13.5 million
UFC Cut of that x.5= 6.75 Million
Gate for 108= 1.9 million
Gross Revenue= 8.65 million
Fighter Payroll (disclosed) 850,000
Est. overhead (venue rental, production costs, non-fighter payroll, advertising) 2 million.
Net Revenue= 5.8 million
Rashad is probably the only one that got a PPV percentage, so that’s a factor. But basically the only question is how much the overhead for these events are, cause that’s the only number I’m totally pulling out of my ass. But it looks like the break even point for the UFC would be much much lower… like 130,000 buys. Maybe less.
"an excellent example of why most MMA "journalism" is a joke. Pseudonyms like "toxic" and shitty writing like that dopey article"--- Joe Rogan.
Good stuff although I would guess that advertising costs are themselves significantly more than $2 million given how much they advertised on Spike and elsewhere. I would also note that your calculations do not include sponsorship dollars that the UFC receives. I would guess that as MMA continues to become more prominent sponsorship dollars will come to represent a larger and larger portion of the revenue stream.
Also note that “break even” is being used slightly differently in your post because it doesn’t factor in the opportunity cost of doing the show on Spike and hidden costs such as cannibalization of future PPVs revenues. (Nevertheless I don’t disagree that the UFC likely turned a “profit”).
It’s very difficult to know much about what the UFC makes given how little info is disclosed about these events.
by The Darkness on Jan 25, 2010 3:19 PM EST up reply actions
As I understand it
the sponsorship fee is more of a “prove you’re a legit company” than a profit making scheme. There are so many upstart clothing brands of guys in a garage with heat transfer equipment and American Apparel blanks that they want to weed out.
Also, keep in mind that UFC is the only brand that sells at events… no Affliction, Bad Boy, or Silver Star sales there. Between shirts, guys who think their girlfriend would look hot in the ring girl bikini, $20 programs, and the promotions sponsors (Harley Davidson, Bud Light, etc) there’s even more income on every event.
As for the Spike cards, it’s hard to get better demo specific advertising than UFC shows. The video game and movie industry knows it. Assassins Creed 2 and whatever horror-turned-torture-porn movie know that it’s the best ad space on cable for them.
"Someone is WRONG on the internet. What do you want me to do? LEAVE? Then they'll keep being wrong!"
-Randall Munroe
the sponsorship fee is more of a "prove you’re a legit company" than a profit making scheme
I’m pretty sure The Darkness was talking about the money the UFC gets from Harley Davidson, Bud Light, and whatever crappy action/horror movie is hitting theaters next week.
I wasn't sure which he meant
so I addressed both. Actually, everything you said was mentioned. Cool.
"Someone is WRONG on the internet. What do you want me to do? LEAVE? Then they'll keep being wrong!"
-Randall Munroe
Hey, it happens.
Forgiving bro-hug time?
"Someone is WRONG on the internet. What do you want me to do? LEAVE? Then they'll keep being wrong!"
-Randall Munroe
At 130k buys you would have to also assume the gate would suffer as well.
Global TV Distribution, there’s some good money there as well and only growing.
whatever the PPV number is
Whatever number the UFC releases as the PPV buys, take that number and divide by 2 and then you’ll have the real numbers.
Thank god you were here to clear that up.
by ufc4 on Jan 25, 2010 3:13 PM EST via mobile up reply actions
It took over six months to get a fifth comment from morph999, but I think we can all agree that it was worth the wait.
Bolts from the Blue // "He looks like a catfish" - Nick Hardwick on Brandon Siler
Bloody Elbow // " looks like your comment violated rule #4. and it’s a heck of a rule, rule #4" - Kid Nate
by Richard Wade on Jan 25, 2010 4:54 PM EST up reply actions 3 recs
LMFAO
This guy’s comments are awesome, I wish he’d come along more often. Check out this gem from MMA Mania:
Lesnar wasn’t even sick ….at any point Do you realize that Lesnar and Dana can say anything they want about his health and there is absolutely no way to verify or dispute it? You’ve been taking for a ride. We all have. It’s time to realize that Dana and Lesnar were lying the whole time. They wanted to wait for some reason. Who knows. Maybe they decided that Lesnar fighting Carwin was a bad idea. They’d rather give him Mir again since Mir is a company man and Dana puppet. I guarantee that Lesnar was never sick.
And another beauty:
I’ve never known Finkelstein to lie. I have known Dana to lie but not Finkelstein. Dana is just stirring to pot again and all you guys have taken the bait like idiots yet again. He knows whatever he says will be posted all over the internet. He’d rather this get posted than, "UFC 108 did horrible numbers". Don’t you get it ? Fedor is not coming to the UFC, ever. I really highly doubt it. Do you think Fedor and his coaches don’t realize that UFC is fixing fights? I’m quite sure they know that they are fixing fights. I don’t think Fedor wants to be involved in that.
And finally:
UFC is a private company. Is it possible UFC sold more than just 10 % to Abu Dhabi? I think so. They are under no obligation to give us the real numbers. What if they sold the whole company? What if they sold the whole company and Dana and Fertitta Bros are being kept on for a few years as managers until the whole deal is completed. What if that is the deal? You wouldn’t know about it. Dana says, "one day, I’ll be out of the picture". Under the deal, they wouldn’t be allowed to say what really happened. If they told you that the entire company was sold, people would flip out, boycotts would ensue. This way, everyone is still happy and Abu Dhabi takes over.
Through some extensive research I did manage to find a pic of our friend morph999:
by ufc4 on Jan 25, 2010 9:31 PM EST up reply actions 2 recs
This guy is great :D
Fedor is like Nikola Tesla
http://www.mmamania.com/2010/1/20/1261799/fedor-emelianenko-i-am-polar-bear#29236772
Just like I said ealier $2 million dollar gate, 300k buys a very exciting card sounds to me like UFC 108 was another successfull show for Zuffa. It just keeps proving that they are so far ahead of the game it’s not even funny, honestly what more can you ask for after all the injuries and negative articles for a show.
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