Believe it of not, but the seven-year blockbuster broadcast deal that Ultimate Fighting Championship (UFC) signed with FOX Sports back in 2011 is already almost up for renewal. And, according to Sports Business Journal, the leading mixed martial arts (MMA) league, which was recently sold to WME | IMG for a staggering $4 billion, is looking to land a $450 million annual commitment.
That is a "four-fold" annual increase of the estimated $115 million deal brokered back in 2011. It gets better: UFC will ask that its future television partner for a 10-year commitment. Just for the sake of comparison, FOX, NBC and CBS pay the National Football League (NFL) about $1 billion annually (each) for their television rights over a nine-year span that ends in 2022, according to Forbes.com.
FOX Sports, which airs a mix of UFC events on broadcast and cable (FOX Sports 1), will reportedly have an exclusive negotiation window that starts in late 2017 (the current deal expires in 2018).
Here is what's on the table:
"The package the UFC will take to market will include the rights to four annual broadcast windows that FOX now holds, six annual cable events and weekly programming on FOX Sports 1, plus the UFC's over-the-top Fight Pass service. It is not expected to include the UFC's lucrative pay-per-view business, which will likely be retained by WME-IMG. But some media executives believe any winning bidder will have more of a say in what matches will be part of the UFC's pay-per-view events. Whether a network will share in some of the PPV revenue is a deal point that will be negotiated, sources said. The new package also could include the significant change of having the networks produce the events, sources said. The UFC now pays all production costs, so that change would increase costs for the media partner."
It's definitely complicated, with a lot of lucrative levers that need to be pushed and pulled until both parties are satisfied. However, it could actually include more than just one network (just like the NFL example above), with UFC apparently willing to explore "splitting the package among two or more TV networks." ESPN, Turner Sports and NBC Sports Group, which recently invested $200 million in VOX Media -- parent company of leading online MMA properties such as MMAmania.com, MMAFighting.com and BloodyElbow.com -- are among the likely candidates interested in a potential deal (in addition to FOX Sports). Digital media companies such as Amazon, Facebook, Google and Twitter could also throw their hats in the ring if FOX Sports, which attempted to buy UFC outright over the summer for $3.6 billion, cannot lock down an agreement during its exclusive window.
WME-IMG's Ari Emanuel, who helped negotiate UFC's initial FOX Sports deal as a consultant, and FOX Sports President Eric Shanks, who was part of the negotiating team that sealed that same deal on the other side of the aisle, are expected to lead negotiations for each side for the renewal.