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As 2019 comes to a close, it’s time for the annual MMA year-end review and “Top 10 ‘insert category here’ lists” that media outlets are so fond of making. While most articles will focus on the sport’s fighters and their exploits inside the cage, this particular piece will look at the most significant deals and partnerships made outside the arena and how they shifted the industry landscape for the promotions that put on the shows fight fans love. From new broadcast partners to developing a fanbase in emerging markets, 2019 was a big year for business in MMA, and with the record revenue and exposure came a lot of changes. Here are some of the biggest developments in the MMA business from the past year:
The Advent of Streaming
2019 saw the implementation of several of the largest MMA promotions’ new media rights partnerships, with the majority of their content being moved from television to over-the-top streaming services. The Ultimate Fighting Championship and Professional Fighters League
found new homes on ESPN+, One Championship struck a deal with Turner Sports to broadcast on the B/R Live app, and even the largest regional promotion, Legacy Fighting Alliance, made the move to UFC Fight Pass. The shift from TV to streaming reduced the transparency of viewership numbers for events, put an emphasis on subscribers over ratings, and led to one of the most significant deals in MMA history when the UFC gave exclusive pay-per-view distribution rights to ESPN in exchange for guaranteed revenue. The move also put more strain on MMA fans financially, requiring consumers to sign up for multiple paid subscription services rather than the all-inclusive package that came with cable television. Out of all the changes in the industry that came out of this year, the rise of streaming may be the most important, and quite possibly the one that will have the longest-lasting effects.
Outside Investment (Or Lack Thereof)
As was the case in most other industries, MMA organizations saw a healthy amount of outside investment from venture capital firms and prominent investors in 2019. While venture capitalists putting their money into promotions is nothing new, this year had a few key developments that could have important ramifications down the line. The PFL managed to raise $30 million in a Series C funding round which saw notable investors Ted Leonsis, Jimmy Iovine and Kevin Hart put money into the organization during an interesting year for the company. Endeavor, the parent company of the UFC, pulled its IPO last-minute due to concerns that the share prices of its stock would tank and left the talent media conglomerate with no relief from the sizeable amount of debt it has accrued from various acquisitions. As MMA promotions continue to look for ways to grow and raise capital for expansion, expect outside investors to play a bigger role in MMA in the years ahead.
A Shift to a Global Perspective
In regard to expansion, 2019 saw several MMA promotions shift their focus to new emerging markets around the world. Bellator put a strong emphasis on its European Fight Series and announced a deal with the UK’s Channel 5 to air the promotion’s cards on the continent for free. One Championship solidified its plans to enter the North American market by signing the aforementioned deal with Turner Sports, broadcasting its events on the B/R Live app and TNT network television. The UFC signed a five-year deal with the Department of Culture and Tourism in Abu Dhabi, renegotiated its media rights deal in China and opened a new UFC Performance Institute in Shanghai, with plans to build more UFC PIs around the globe in the coming years. There is little doubt that this shift in perspective for MMA promotions will be a permanent one, especially as champions within organizations continue to become more internationally diverse.
Cross-Promotional Collaboration
What started in 2018 with the historic MMA trade between the UFC and One Championship continued this past year in the form of promotional collaboration. Bellator and Rizin have teamed up on multiple occasions this year to have their fighters square off in cross-promotional showdowns, including title bouts. Kyoji Horiguchi managed to become a two-promotion bantamweight champion this past June when he defeated Bellator 135-pound titleholder Darrion Caldwell in a rematch of their 2018 New Year’s Eve fight. Although he had to relinquish both titles due to injury, all signs point to the two organizations continuing their collaboration efforts in the future. While it's unlikely that the UFC will get in on the cross-promotion action, One Championship has expressed interest in partnering with other MMA entities, and it wouldn’t be shocking to see this trend continue on into the next decade.
Publicly Released Numbers
The move from television to streaming may have reduced fans’ and pundits’ visibility regarding viewership and pay-per-view buys, but thanks to the UFC antitrust lawsuit hearings a treasure trove of historical data was made public this year. The information revealed by the hearings about the premiere MMA promotions included UFC revenue by year through 2016, new revelations about fighter pay and insight into negotiations between promotional matchmaker Joe Silva and athlete managers. The findings also shine a light on wage share between multiple organizations, with UFC fighters getting about 20 percent of company revenue and Bellator fighters getting around 44 percent. If the judge in the lawsuit grants the plaintiff's request for class certification, there is a chance that more historical information (and possibly even current information) will be released, as well as bringing forward several prominent UFC executives to testify under oath. Whether the case continues on is anybody’s guess at this point, but 2019 certainly gave us the long-awaited peek behind the curtain into how the UFC has been doing financially and how fighters are truly compensated for their efforts in the cage.