The UFC is officially set to begin negotiations on a new TV deal starting in January with its current partners at ESPN maintaining a three-month exclusive window to hold onto the promotion.
On Tuesday, TKO Group Holdings president and chief operating officer Mark Shapiro revealed the timeline for negotiations with plans to begin talks with ESPN in early 2025. Shapiro made it clear that the UFC would like to stay with ESPN after a successful partnership that dates back nearly seven years, which now includes all events as well as pay-per-views running on the Disney owned platform.
“Our window to negotiate is exclusive with ESPN/Disney from Jan. 15 to April 15,” Shapiro said during the Goldman Sachs Communacopia + Technology Conference. “No formal conversations have started as of yet and let me be clear, it is our intention to re-sign with ESPN and Disney.
“Because they’ve shown that they do it best. They understand synergy, they understand marketing, They do a great job technologically with developing their platforms, engaging their consumers and of course ESPN flagship, which is their direct-to-consumer [streaming platform] is on the way. So we’re anxious to see what that’s all about and where we can fit in there.”
Shapiro also heaped praise on Disney CEO Bob Iger as a true champion of sports programming after they previously worked together when he was the vice president of programming and production at ESPN.
“It’s rare when you have a CEO of a major media company that gets granularly involved, if you will, on all levels of content,” Shapiro said. “That’s what Bob Iger does. At the end of the day, he’s a sports freak. He now owns a women’s soccer team in the NWSL with his wife Willow. He came up through ABC Sports, huge boxing fan, and when I worked at ESPN, there wasn’t a Monday morning I didn’t get notes on sports content for the weekend while he’s running Disney.
“Those are the kinds of champions you want to be with. I think folks underestimate how much money ESPN and Disney spend on a weekly basis promoting our UFC fights. We’re not looking past them. The conversation starts there.”
As much as Shapiro touted the current partnership between the UFC and ESPN with hopes that the two sides could reach an agreement on a new deal, it seems highly unlikely that a contract ends up being finalized during that three-month negotiating window.
It’s almost part of the process for any sports league like UFC to accept offers from other potential broadcast partners to understand the true value of the rights deal.
With streaming outlets like Netflix and Amazon seeking out more and more live programming — with billions of dollars in capital to spend — it’s tough to imagine the UFC won’t at least see what options are available after April 15.
In fact, Shapiro said there are already some outlets who have expressed interest in talking to the UFC about a new broadcast rights deal once that exclusive negotiating window with ESPN ends.
“Having said that — there’s so many other platforms that are looking for premium sports content and again, the demand is outstripping supply,” Shapiro said. “If we get out of that window, and we don’t have a deal, we will immediately take up with two or three platforms specifically that have told us they’re anxious to have those conversations.
“I think what stands out for us again is not just the fact that we have so much flexibility and control, ownership, commissioner all in one, we’re year round, we’re the antidote for churn but also when it comes to the UFC, it’s premium and not so much volume. That’s a big play there. If you want to get volume in a premium, the WWE might be the play for you because there’s so many events. But when it comes to the UFC, you’ve got your 12 pay-per-views a year and you’ve got your — depending on where we end up here — your 30 to 40 [Fight Nights], which is every single week. You can use them on whatever platform you want.”
Shapiro mentioned specifically how much the UFC played a part in the growth of ESPN+ as the streaming service was first launching after brokering an exclusive deal to land the MMA promotion.
Because the UFC maintains such a loyal fanbase not to mention continued growth year after year, Shapiro understand the value that the organization brings to any potential broadcast partner.
“We’ve been the driver of ESPN+,” Shapiro said. “We will continue to be flexible for our partners as long as they are interested in the three things we focus on a daily basis all the way down to the manager level at our company, which is one, revenue growth and profitability. Two, margin expansion. Three, audience and brand growth.
“That is something we tutor, we mentor and we educate all the way down to the manager level. So folks are thinking about that as their mission when they go about their daily chores.”
One aspect that could draw a lot of eyeballs with this next TV deal is how the UFC approaches the future of pay-per-view.
Just after striking a deal to move to ESPN following several years with FOX, the UFC ended up extended its partnership with the sports-based outlet to include pay-per-view broadcasts that now live exclusively on ESPN+. Rather than gambling on one pay-per-view card to the next when it comes to overall sales and then splitting those profits with broadcast companies like in-Demand or DirecTV, the UFC now receives a set fee from ESPN for each pay-per-view.
Shapiro said when that deal was first brokered UFC CEO Dana White didn’t actually like the idea, but the longterm success has been undeniable.
“I will tell you when we did the PPV deal with ESPN, Dana White wasn’t completely on board with that,” Shapiro explained. “He loves being a promoter. He loves being the barker that he is with fights. I’m sure you heard yesterday the way he talks about UFC 306 at the Sphere this weekend. There’s no better promoter, no better megaphone and he’s so passionate and he’s so authentic about it. The idea of losing control of the PPV, if you will because it was on in-Demand and DirecTV, wasn’t something he was really up for.
“But he went along because he’s a great teammate and it worked out. It worked out really well. But the idea of us taking that back in house or splitting the package, the half-package, and selling to somebody else, we’re up for all of it.”
In the past, Shapiro mentioned that the UFC could potentially even entertain eliminating pay-per-view broadcasts all together — for the right price. There’s also a chance the UFC just takes back control of the pay-per-views or just sells the pay-per-views to a different partner as a totally separate package from the rest of the broadcast rights.
In other words, the UFC is open for business.
“The idea of us taking [PPV’s] back in house or splitting the package, the half-package, and selling to somebody else, we’re up for all of it,” Shapiro said. “That’s the biggest message that I can give to all the bidders or potential suitors and IMG’s been phenomenal, of course they sell our international rights for UFC, in getting that message out. We’re here to play.
“You have a platform to build, a platform where you have to increase penetration, you have a platform where you’re looking to take up price, we’ll take it up by using the UFC and WWE because we have a history of delivering.”
File under: Mmafighting.com | Leave a comment »