Ultimate Fleecing
UFC’s deal with Fox was supposed to secure its future. So why is the premier mixed-martial-arts promotion in such bad shape?
By Tim Marchman and Tomas Rios
Posted Thursday, Dec. 6, 2012, at 4:34 PM ET
If you have a television, and that television receives one of the many stations owned by Fox, you’ve probably seen the ads. On Saturday! There will be fights! Benson Henderson! Will be defending his lightweight title! Against Nate Diaz! B.J. Penn! Will be fighting! Rory MacDonald! There are clips of men punching other men, and torquing their limbs as grandiose music plays. The Ultimate Fighting Championship is on Fox!
If you’re like the vast majority of television owners, none of this means anything to you. Building a sport is not quick work, and so the fact that the UFC—not long ago a barely legal fringe concern—hardly registers with the general public is unsurprising. What is surprising is that, just more than a year after the UFC signed a major rights deal with Fox, its business appears to be in a dangerous downturn. The UFC, it seems, was quite literally not ready for prime time.
“That’s all bull****,” says UFC president Dana White of any suggestion that his company looks a bit like a deer pinned under a lion. “That’s all bull****. There’s a bunch of **** out there on the Internet, when you listen to all the crock of **** out there with people who have no ****ing clue what they’re talking about.”
The facts, though, read like this. UFC’s Fox debut last November averaged an impressive 5.7 million viewers. Its last two offerings, by contrast, both drew an average viewership of about 2.4 million. The current season of The Ultimate Fighter reality show has averaged 835,000 viewers for FX on Friday nights, a huge decline from past seasons. And sales of the UFC’s pay-per-view cards are all but guaranteed to decline for a second straight year, from an estimated 9.27 million PPV buys of 16 events in 2010, to 6.49 million buys of 16 events in 2011, to 5.28 million buys of 12 events in 2012 with one card yet to air.
There are a variety of explanations for all of this. Eric Shanks, the president of Fox Sports, cites communication issues between Fox, FX, and Fuel, the three main stations running UFC content, the difficulty of finding a proper format in which to present an event-driven sport, and “confusion in the marketplace” caused by Spike, former home of the UFC, continuing to run old fights on what seems like a constant loop. Dana White points to an unprecedented string of injuries to top fighters this year—“Eight out of 12 main events fell out. That’s 67 per cent! That’s crazy! That’s unheard of!”—as well as top heavyweight draw Brock Lesnar’s departure for pro wrestling.
Still, the simplest and most logical explanation for the decline is this: The UFC has been running lousy shows. Until fairly recently, White could rightly claim that his fight cards were a better deal than those put on by boxing promoters. At that point, he was taking advantage of UFC’s virtual monopoly on top mixed martial artists, staging main events that fans clamored to see and undercards with another two, three, or four interesting bouts. Lately, though, top stars like Jon Jones and Anderson Silva have been fighting walking speedbags like Vitor Belfort and Stephan Bonnar, while spent fighters who should have retired years ago, such as Tito Ortiz and Antônio Rodrigo Nogueira, have topped the preliminary cards.
“My wallet is still yelling at me for spending 50 bucks,” groused one writer about a lame June card. A month later, another event inspired this lede: “Dana White was ‘embarrassed’ by UFC 149, while most fight fans were simply bored by it.” A month after that, UFC actually canceled UFC 151 for want of a main event, leaving open the question of whether a dull night of fights is better than none at all.
Why has UFC been running lousy shows? Some of it is down to luck, and some is down to the nature of a sport where even tightly controlled training involves serious violence. A lot of it, though, is a consequence of how badly UFC got played by Fox.
When White and company proudly unveiled the Fox agreement in August 2011, it seemed like the greatest thing ever to happen to the UFC and, by extension, mixed martial arts. Not only was a major broadcaster promoting a sport that still isn’t even legal in New York, but the deal’s estimated annual value of $90 million to $100 million represented a significant upgrade over the UFC’s prior broadcast deal with Spike, which topped out at a reported $35 million per year. In all, it gave the UFC a new legitimacy and, crucially, a stable flow of cash to buffer it against the inherent ups and downs of the pay-per-view market. (When PPV buys make up something like three-quarters of your net yearly revenues, you don’t need Wu-Tang Financial to tell you it’s time to diversify.)
But even as it gave the UFC some steady income, Fox extracted commitments that have all but crippled its new partner. Those commitments came in the form of massive amounts of content, something Fox is ravenous for in light of its aggressive expansion efforts. In 2010, the UFC ran a total of 24 cards, including those on PPV. By the end of this year, the UFC will have put on 31 shows, more than half of them staged for Fox, FX, or Fuel, a number that should rise yet again when the Fox Sports 1 channel launches some time in 2013. None of this even takes into account episodes of The Ultimate Fighter, or the way Fuel is all but branded as the UFC Network, with an endless array of programs like UFC Insider and UFC Tonight in addition to reruns of old fights, soft-focus specials promoting upcoming cards, and such.
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