UFC's Market Dominance an Overwhelming Deterrent to Emerging Startups

The UFC's growth and dominance of the market is making it hard for emerging startups to have any chance of growth. (Photo by Victor Decolongon/Getty Images)

On Thursday, Ken Hershman, executive vice president and general manager of sports and event programming for Showtime, resigned after a nineteen years with the subscription-based network. Hershman was pivotal to the growth of mixed martial arts, bringing the sport to the network in 2007 in the form of EliteXC. EliteXC inevitably failed, but Hershman kept his resolve, adding Strikeforce to the portfolio and helping the small California-based promotion become a major player in the mixed martial arts' world.

Hershman isn't leaving the industry however. He's been named the new president of HBO Sports, opening up the possibility that HBO will lift their embargo on the sport. In the aftermath of the news, there were also questions revolving around Showtime's continued committment to the sport. Will they work out a deal to keep Strikeforce on Showtime? Will they remain in the MMA business?

BloodyElbow.com's own Brent Brookhouse opined yesterday that Hershman's move to HBO is likely focused more on helping boxing grow on the network versus bringing in a new option:

Hershman's move to HBO isn't likely to bring MMA to that network either. Boxing remains a big part of HBO's identity and despite uninformed opinions that the network will eventually give up on the sport, they actually are investing even more in the sport. In 2012 the network is launching a midweek boxing show that will feature competitive fights on a smaller budget to try to aid the process of building up stars.

I couldn't agree more, and I find it perplexing that the immediate reaction from many fans and media was the blatantly optimistic opinion that HBO will now open its doors to MMA. As for Showtime's future in the sport, Strikeforce is an option, although there are many reasons why staying connected to Zuffa may be the wrong way to go.

These are only micro issues underneath the larger macro problem that start-ups and networks promoting MMA are entering the sport with an even steeper slope than we've ever seen before. The UFC's expansive reach, years and years of brand saturation, and buyout of the second largest promotion in the world has turned their large lake into an ocean, sucking the water from all the smaller lakes and ponds. They control a vast majority of the relevant talent in the sport with only a few outliers who are able to draw any semblance of interest from fans.

Ten years ago, start-ups had options. EliteXC and Strikeforce both fed off veteran talent, both to promote their main card and test young prospects, while also taking advantage of regional honey holes like southern California. The more options, the more talent was willing to negotiate and take the best offer, especially when those smaller promotions were gaining traction in the television landscape. Fast forward to today, and we see that EliteXC has crumbled, Strikeforce has been swallowed by Zuffa, and casual interest outside of the UFC is at an all-time low.

Look no further than ProElite for proof. I'm not attempting to be the most cynical man on the planet, but it's difficult to see a progressive trend of growth when Pedro Rizzo vs. Tim Sylvia and Andrei Arlovski vs. Travis Fulton are the top two fights on one of the newest start-ups in the sport. The proven formula of growing prospective talent while bringing in name value doesn't work any longer because name value has disappeared. Who is Reagan Penn and Mark Ellis, assuming they progress into bona fide talents, going to fight down the road?

The optimistic fans will throw Bellator right into my face. Look at what they've done! They've signed a bevy of great prospects, many of which are featured on the 2011 World MMA Scouting Report. They have notable names that fans will tune in to watch. Unfortunately, they are hindered by MTV2's decision to keep them on Saturday nights, going head-to-head with the UFC, and that's not their most glaring problem.

Whether it's a start-up promotion or an established brand like Bellator, finding recognized veterans to prop up cards and draw in fans who wouldn't normally watch the card is becoming harder and harder to do. In fact, it's impossible to do these days. Bellator is going to find out quickly that Eddie Alvarez has nobody to fight. Same goes for the rest of their champions.

What does any of this have to do with Showtime and HBO? In my opinion, Showtime's best option is to let Strikeforce go and start their own series. It isn't necessarily a promotion, more of a series of shows designed to build cheap programming and maintain subscribers. After the failure of EliteXC and the piece-by-piece stripping of anything worth a damn from Strikeforce by the UFC, Showtime's biggest issue has been outside forces crushing their MMA programming.

The problem, however, is that there isn't any talent to build from. It's pointless for HBO to waste the money entering the market unless they want low budget, cheap programming regardless of name value. Same goes for Showtime. Even if they retain Strikeforce, it's going to be tough for them to gain enough steam to move away from sustainability into growth. The mere second a prospect begins showing signs of greatness, Zuffa will swoop in and sign him to a UFC contract.

Smaller promotions in North America and beyond serve a purpose as development platforms for prospects, but I believe the days of spectacular growth, growth seen in two or three years in the market are gone. There isn't enough recognizable talent available to help small promotions gain eyes, and building prospects to a casual fanbase requires money to promote them. Even the latter is a risky endeavor. Will fans care more about Eduardo Dantas if they spend a lot of money promoting him? Who has he beaten? Who is Wilson Reis? Those are questions people will ask.

Be honest and ask yourself... what fighters, outside of Zuffa, would you actually tune in to watch? Most will cite Bellator fighters, perhaps Nate Marquardt, Roger Huerta, or Shinya Aoki. How many of those are viable options for a promotion like Titan FC to bring in? Will that help them keep your interest for a prolonged period of time? Probably not. The point is that it isn't a large number. It's so small that there are barely any options for regional promotions looking to make an impact to consider. 

This isn't the boom years of MMA any longer. The upward trend is slowly flattening out, and the UFC has come out as a massive presence. In North America, they dominate the landscape. Internationally, there is opportunity. More on that later. For promotions like Shark Fights and Titan Fighting Championships however, it doesn't look good. 

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