It looks like the UFC on Fox is a reality. Sports Business Daily laid out the basics of the deal -- $90M/year for 7-8 years, four shows per year on Fox, Spike/Versus content moving to FX, but everything else is up for speculation until someone from Fox or the UFC agrees to comment on the record.
Here's the biggest questions raised by the deal:
1. Will the UFC maintain control of production?
The UFC protects its brand image like a mama bear with her cub. Rumored deals in the past have fallen through as a result of the UFC's insistence that they control the broadcast. The terms of the deal, to my amateur eye, suggest that the UFC left some money on the table for that to happen. That still doesn't preclude Cleatus the Robot from shadow boxing in the corner of our screens.
2. How will the UFC balance Fox shows with pay-per-view events?
Luke Thomas thinks we won't see mega events on Fox. I expect to see a big show for the Fox debut. That show is going to receive a lot of press, and it's important for the UFC to deliver to the best of their ability. Past that, I expect we'll see PPV-quality shows on the level of UFC 132, if not a little better than that. UFC 132, by my estimation, pulled in less than $10M in PPV revenue (assuming a 50/50 split of a $50 ticket). The way I break down the Fox deal is $15M/Fox show and $30M/year for the FX content. If that's the case, the economics make sense for legit big shows on the network. I wouldn't expect GSP or Lesnar on Fox outside that first show, however.
3. Will Fox have a hand in the match making?
Showtime played (plays?) a major part in the Strikeforce match making, and there's a reason you see so many TUF guys on Spike TV shows. Networks have a big role in determining which games get the national broadcast, which is why you see the Red Sox and Yankees so much on ESPN's Sunday Night Baseball, for instance. It's hard to imagine Fox without some recourse in determining who gets on the network, so the biggest issue here is just how much influence they are given.
4. How much of the contract is guaranteed?
There would be a certain irony if Fox cut the deal two or three years in due to poor performance. I expect the UFC will draw well on network television, but their incentives change if Fox has the ability to jettison the deal. They couldn't afford putting on half-assed shows that function as a three-hour informercial for the PPV model.
5. What does this mean for the fighters?
The big-time draws like GSP and Lesnar are going to want to stay away from Fox unless the UFC guarantees them money to supplant their loss of cuts of PPV revenue. For everyone else, especially the guys at the low end of a main card, this is an opportunity to make good money on sponsorships. A lot of guys just got an artificial pay raise with this move.