Report: ESPN + FOX to bid jointly for UFC television rights
The point MMA became mainstream is a matter of debate, but could date to 2011 when the UFC and FOX signed a seven-year television deal, worth approximately $120 million per year by the end. Now it’s 2018, the deal is up, and the UFC reportedly wanted $300-400 million per year.
FOX balked, perhaps because viewership is down. Big FOX shows are down 22% compared to the year before, while Fight Night events are down 17%. However, Andrew Wallenstein and Daniel Holloway report for Variety that rivals ESPN and FOX have teamed up in a joint bid for UFC television rights, that could bring as many as 15 fight events to the ESPN+ subscription streaming service.
FOX and ESPN parent company Disney currently split right for several leagues including Big Ten Conference, MLS, and Pac 12 football, so an agreement, if it comes to fruition, would not be unprecedented.
According to sources with knowledge of the proposal, ESPN has signaled that it would be willing to pay $120-180 million per year to add the Endeavor-owned mixed martial arts league to its collection of live-event rights.
Fox, which currently pays $120 million per year UFC rights, would be willing see that number increase to a little more than $200 million. Fox’s current package includes four Saturday-night fights per year on Fox Broadcasting and a number of fight events on cabler Fox Sports 1 that has increased annually under its current agreement. A joint bid with ESPN would see Fox’s total number of events decline slightly.
For ESPN, a UFC deal would provide premium live-event content for the fledgling ESPN+ service not currently available on the company’s linear cable channels. ESPN+ launched last week at $4.99 per month with a mix of content including select games from MLB, NHL and out-of-market MLS games.
The MMA league has explored options from handing over the rights to a traditional network like Fox or one of the growing number of tech giants who have displayed an increased appetite for sports rights over the past 12 months. Endeavor CEO Ari Emanuel has also considered holding onto the rights and distributing over the league’s own streaming service, a possibility that received renewed speculation last month when Endeavor spent $250 million to acquire streaming provider NeuLion.
A post-acquisition 21st Century Fox would consist of a slimmed-down Fox Sports, Fox News, and a Fox Broadcasting uncoupled from its lucrative television studio counterpart. The company, referred to as New Fox internally, is expected to be driven primarily by sports and news programming.
The $4 billion paid by Endeavor (then WME-IMG) for the UFC appeared initially to be impossibly high. However, Endeavor cut costs with a samurai sword, remarkably increasing profitability. If the current TV deal goes above $300 million per year, covering the gigantic note is eminently doable.