How Brazil, not Canada, became the UFC’s Mecca

MMAjunkie‘s Steven Marrocco and Ben Fowlkes obtained a 58-page UFC investor document that details some of the inner financial workings of the world’s dominant MMA league. It explained how the new owners WME-IMG intend to increase earnings, who the UFC believes will be bidding for television rights when the current FOX deal expires in 2018, how the league navigated the massive PPV revenue drop in 2014, and looks forward to a bright future.

In the latest article, Marrocco and Fowlkes detail how Brazil eclipsed Canada in terms of revenue and numbers. Once, Canadians were so enamored of King GSP that he was named the Canadian Athlete of the Year by Rogers Sportsnet in 2008, 2009, and 2010. UFC 129 in Toronto in 2011 was the largest live gate in the nation’s history, eclipsing The Olympic Games, the Rolling Stones, the Stanley Cup, and everything else.

Canada is the Mecca of mixed martial arts, UFC president Dana White was once quoted as saying in Jonathan Snowden’s The MMA Encyclopedia. A glance at the numbers indicates that that is no longer the case.

Television rights fees (exclusive of PPV) were:
•$500,000 for Russia (with 13 million fans)
•$2,000,000 for Australia (with 2 million fans)
•$2,000,000 for Canada (with 4 million fans)
•$5,000,000 for the UK (with 6 million fans)
•$5,400,000 for China (with 37 million fans)
•By startling contrast, rights fees for Brazil were $40,000,000 (with 37 million fans).

260 million UFC fans were identified worldwide. Unfortunately, 85% of those fans live outside the USA, and collectively produced just 13% of total revenue. That’s not an 80/20 rule, that is 85/13.

This provides an area where new owners WME-IMG believe they can increase revenue. The agency sells international rights to the NFL, Premier League, and NASCAR among many others. With that experience and potential synergies, when it comes time to negotiate new international deals, the new owners aim to see an increase in riches.