UFC’s deal with Fox was supposed to secure its future. So why is the premier mixed-martial-arts promotion in such bad shape?
Posted Thursday, Dec. 6, 2012, at 4:34 PM
Photo by David McNew/Getty Images.
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 bullshit,” says UFC president Dana White of any suggestion that his company looks a bit like a deer pinned under a lion. “That’s all bullshit. There’s a bunch of shit out there on the Internet, when you listen to all the crock of shit out there with people who have no fucking 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.
From Shanks’ perspective, there’s no problem here. “The bulk of UFC is on Fuel,” he says, “and I think that’s been a smashing success. It’s the fastest growing network in all of television.” Leveraging the UFC to increase carriage rates for that network, and to increase FX’s reach into desirable demographics, are clear wins for Fox. It’s just not clear that they’ve been wins for the UFC.
Take the idea of moving The Ultimate Fighter, the reality show that built many of the promotion’s most marketable stars, to Friday nights. “The Ultimate Fighter hit a fucking home run for FX,” says White. “It just wasn’t hitting a home run for us. We wanted to pull bigger numbers. But as far as FX, their viewership 18 to 34 is up 59 percent, 18 to 49 is up 75 percent on Friday nights. Fucking home run for them.”
Moving the show to Tuesdays, which will happen soon, won’t do much to solve the UFC’s supply-and-demand problem: There just aren’t enough marketable fighters to stock all the cards the UFC has lined up. Over the last two years, UFC has addressed the problem by introducing 145-, 135- and 125-pound divisions, and starting next year it will promote a women’s division as well. This will lead eventually to a near-doubling of the UFC’s effective roster size—at the peak of its popularity, the company was promoting just five divisions—that carries few obvious benefits, given the public’s lamentable lack of interest in smaller fighters. Increasing the number of cards by nearly one-third in two years, and staging more bouts featuring either lower-quality or less-appealing fighters, makes for an inferior product, and thus leads to people tuning out in droves.
Fox has UFC on the hook for six more years and, says White, “we’re probably going to be on there for the next 16 years,” so none of this is going to change any time soon. It may seem illogical for Fox to keep whipping the horse, but the fact is that the UFC deal is a small gamble for them. If the UFC somehow rises to the occasion, Fox controls an entire sport; if it continues its decline, Fox still has a well of cheap live programming that can at least hit target demographic numbers. There is no losing scenario for Fox in this deal, and that’s how you know the UFC is in over its head.
As deep and abiding as the UFC’s problems are, fixing them is hardly impossible. It’s unclear, though, if White is the man to do it. “The reality is,” he says, “we are one of the major sports. We’re on a network that carries the NFL, we’re on a network that carries Major League Baseball.” That’s true, but the man often doesn’t act as if he knows it.
Imagine if the combined id of every dickish sports commissioner were given free reign, and you’ve conjured Dana White. There is no slight too small to set him off, no common courtesy too sacred for him to ignore. A run of his greatest hits would include him calling veteran MMA reporter Loretta Hunt a “dumb bitch,” denying media credentials to major outlets for inscrutable reasons, and blindly defending employees who mirror his own at-times repulsive behavior. How, for instance, does he square the company’s attempts to expand business in Brazil with his decision to push middleweight Chael Sonnen—infamous for borderline racist invective against Brazilians—as one of the faces of the company?
“Hey, this is the fight business. And to ask somebody like me? I’m the wrong guy to ask that,” says White. “I think everybody in this country are a bunch of pussies anyway. I’m tired of all the politically correct bullshit.
“Welcome to the real world. Sometimes people say mean things.”
White is plenty likable—it would be pretty great if David Stern responded to critics by saying, “People are fucking stupid and say dumb shit”— and as responsible as anyone else for the fact that the UFC has increased in value from the $2 million his childhood friends Frank and Lorenzo Fertitta paid for it in 2001 to a presently unknown but presumably enormous sum. (The company is privately held, but last fall, Lorenzo Fertitta claimed UFC was worth more than Manchester United or the New York Yankees.) And for what it’s worth, the president of Fox Sports professes not to mind having White around. “Look, there are colorful characters in any sport,” says Shanks. “And they’re people. People say dumb things all the time. How many times do politicians have to apologize for silly things, or awful things, that they say?”
The man who leads his tribe out of the desert, though, isn’t necessarily the one to lead them to the promised land. You wouldn’t be out of line, for instance, in seeing a connection between White comfortably calling Americans “a bunch of pussies” and his company’s inability to attract a stable of big-ticket advertisers.
For those who’d prefer their cage fighting to be controlled by someone more high-minded, there is always the prospect—which White completely, emphatically denies—that the Fertittas might look to cash out of what increasingly looks like a bubble economy in sports. Of course, there is no guarantee that a sale would mark the end of White’s tenure as president, or that a buyer wouldn’t share White’s collection of obnoxious rich guy quirks. So the promotion’s many problems are likely to continue, unless something drastic happens.
The UFC’s path mirrors the history of combat sports on television, which in Japan as well as America has played out as a recursive loop. Boxing, kickboxing, or MMA gets hot. Network executives notice, and in collaboration with promoters, they run so much of it that it starts to bleed together in a great blur of static that sounds like “Henderson title Fuel bro Penn fights Fox, I have other things to do on a Saturday.” For all the technique, grace, and style that make fighting, at its best, a beautiful and satisfying sport—and this Saturday’s card should be an excellent showcase of all that and more—it carries a limited and fragile appeal. The UFC, as White likes to say, isn’t going anywhere. That’s true, but not only in the way he means it.