UFC President Dana White has made mention in recent weeks of the promotion's future potentially without Pay-Per-View, but fans shouldn't jump on that bandwagon just yet. (Photo courtesy of Zuffa, LLC.)
Amid the ever-growing host of lawsuits against streaming sites and their users that pirate UFC events, UFC President Dana White has in recent weeks mentioned a handful of possible futures for the MMA promotion’s future on television. While he has stated that the format of major events on Pay-Per-View supplemented by free TV prelims, The Ultimate Fighter, and free-on-TV minor events such as UFC on FX cards will likely remain in place for some time, both the UFC boss and the fans have kicked around several alternatives, some of which may render online piracy of the PPV events moot if not eliminate the damage they cause altogether. Among these have been ideas where Pay-Per-Views can be purchased in a subscription service similar to the way major sports leagues allow fans to purchase out-of-market games with products like NFL Sunday Ticket or NHL Center Ice and even a complete departure from the PPV arena into a totally broadcast/cable TV approach. From a quick outside glance, either of these options appears to be an easy fix that is win-win for the UFC and the fans, but even when the details fans can’t possibly know about the behind-the-scenes business aspects of making such deals work are taken out, there still are several drawbacks that come with such arrangements. For instance, while putting every fight on “free TV” may sound like a huge win for the fans, there are some benefits of the PPV format that are taken for granted because the UFC has always been a Pay-Per-View first product.
Pros of the No-PPV Approach:
Lower Costs to the Fans: The biggest and single most obvious advantage of doing away with Pay-Per-View cards entirely is saving the $50-$100 avid fans drop on their cable or satellite bill every month to catch all of the UFC Pay-Per-View cards. At an average of $75 a month, this would generate a savings of $900 a year to fans that order every single event. While this may not seem like a huge number compared to the $46,000 the average American household brings in, it is significant when compared to the average cost of cable which is just $300 more per year. Buying every UFC PPV almost doubles the avid fan’s cable bill every month.
More Consistent Fight Card Quality: The UFC consistently offers the absolute best in mixed martial arts action. However, when individual cards are compared to others, especially other UFC cards, there is a fairly large discrepancy. This isn’t about hindsight where fans saw awesome fights on one card and boring fights on another, this is about the name quality of the fighters and interest generated by the fights ahead of time. The UFC has to make Pay-Per-View cards a cut above what they offer on regular TV to ensure they maintain their buy rates. This means if the UFC has five “big name” fights available in a time span with one free card and one PPV, the PPV will get at least four of those big name fights, leaving the free card filled with lesser known fighters. With no Pay-Per-Views, the UFC would need to secure consistent repeat viewership week in and week out. The result would be more even distribution of marquis bouts.
Ironically, a big obstacle to the eventuality of a world without PPV events, is the theft of PPV events via online streams and the resulting loss of revenue. (File Photo)
Money Saved on Piracy Battles: As UFC color commentator Joe Rogan said, “You can’t stop the internet”. Dana White may not stop the internet, but he can certainly garnish the wages of less honorable fans for far more than the cost of a UFC Pay-Per-View when he catches them. This is, however, an extremely costly pursuit. With a PPV-free business model, the piracy problem is minimized. Why would a fan sit in front of a 22″ computer screen watching a low quality pirated stream when they can simply turn on their big screen and watch the fight in HD on FOX, FX, or FuelTV? Piracy will never go away completely – after all, a substantial number of people “borrow” their cable in the first place, but this would minimize its impact. Also, in a TV deal, the UFC would make their money from advertisement deals and contracts with the actual networks, not the fans directly so in addition to the savings on legal pursuits, the streaming sights would have a lower impact on the UFC’s profits in general.
Better Opportunities for Mid- to Lower-Level Fighters: With the major bouts such as title fights and contendership battles being more evenly distributed, this would leave a vacancy on what were once Pay-Per-View cards. These slots would likely be filled with the fights removed from the free TV cards to make room for higher profile fights. The result is a much better chance that an up-and-coming journeyman fighter will open a main card headlined by a huge drawing power as opposed to a card headlined by a more mundane mid-level bout. This results in greater exposure and potentially more sponsorship money to the fighters who need it most.
Cons of the No-PPV Approach:
The Death Knell of the Mega Card: The UFC will always have its traditional super cards on or around New Year’s, Super Bowl Saturday, and Independence Day, but the end of Pay-Per-Views means the end for a need to have cards stacked to the brim with multiple title fights and superstar fights. As stated previously, the focus on long term TV deals is bringing in big numbers consistently while Pay-Per-Views are all about getting as many people as possible to shell out $50 on a single card. Mega cards like UFC 100 where the two highest drawing champions defended their belts against high drawing opponents and the ultra-hyped TUF coaches’ bout anchored the card would be extremely few and far between. After all, why would the UFC put all bouts their fans most want to see on one card when they could space them out and look good to the network by getting the same high number of viewers multiple times in a row?
Higher Cost of Sponsorship: With no Pay-Per-View income, the UFC will make its money primarily through advertising deals and network contracts. This means out of the 60 minutes of commercials during a card, the UFC would get say 20 minutes to themselves as well as what they can get from the advertisers like Bud Light and Harley Davidson who sponsor the events themselves. Where this would become an issue is with the smaller sponsors and in particular the individual fighter sponsors. The greatly increased exposure will come with greatly increased costs, making a $35,000 sponsorship fee to the UFC (which would likely increase) the least of a small lifestyle brand’s worries. A t-shirt a winning fighter wears on a PPV might get seen by a few hundred thousand people – a shirt seen on network TV might be seen by tens of millions, and the costs of that exposure may be out of reach for smaller brands especially if the UFC raises its rates as well.
Greater Gap in Fighter Pay: It is a pretty well known fact that a large portion of what the highest drawing UFC fighters make comes from kickbacks on the Pay-Per-View buy rates. While bonuses for viewership could certainly remain a part of a free TV pay scale, the amount would be nowhere near as great. The UFC could charge more with consistently higher numbers, but in general, they will get paid a certain amount per show by their sponsors. This would result in a need to make up the money lost to the highest paid fighters, thus furthering the gap between the highest paid fighters and entry-level guys. It is unlikely that the UFC will ever get as bad as boxing in terms of entry-level pay versus top tier pay, but the impact could be significant.
Incidents like Dennis Hallman’s (top) fight shorts prank and the resulting “wardrobe malfunction” would have resulted in far more dire consequences than a Dana White press conference rant if aired on network television. (Photo courtesy of FOX Sports)
Stricter Guidelines on Fighter Behavior: This has already had a slight impact due to the greater TV presence that the UFC has recently gained, but a total switch to network and cable TV could change a lot about how fighters behave. When “Superman” Dennis Hallman (51-14) had “wardrobe malfunctions” resulting from his now banned speedo, the MMA world had a light-hearted chuckle and Dana White issued a bonus to his opponent for getting the shorts off TV ASAP. Things would have been much different had it happened on FOX and the FCC gotten involved. Big fines for uncensored swear words, poor choices in post-fight comments, and ill-received pranks (like wearing speedos that result in exposed genitals) would no longer be just fighters being fighters, it would be fines and troubles for the organization as a whole much like the Janet Jackson incident at Super Bowl XXXVIII. That change in demeanor could stifle some of the characters fans have come to know and love in MMA.
Overall, most would agree that an environment where the UFC could still make big money and big improvements on the sport while providing fans the same great product without having to charge extra for Pay-Per-Views would be a huge win for all parties involved, however it is just as important to weigh the consequences carefully before amassing public outcry for change. Ironically, the biggest road block to the UFC getting to the point where PPV is no longer need is the pirates who steal the PPVs. All that lost revenue is money that could be spent on fighter pay, fighter benefits, marketing, and other improvements that could get the organization closer to where it needs to be to make that jump. For now, fans just have to support the sport they love and remember to be careful what they wish for.
