Robert Joyner over at MMA Payout answers the question I was asking last week – what is going on with the UFC’s expansion plans? The answer is actually pretty simple: popularity and an established scene aren’t important factors at all … Zuffa is just going where they think they can build a pay per view audience:
The main prism through which to view the UFC’s international efforts is through a few words that Dana White once said. Dana is fond of saying “I’m in the PPV business, and every decision is centererd around making that bigger.” Lorenzo Fertitta echoed this sentiment in his interview with The Atlantic stating “We call it the wheel. The UFC wheel. You’ve got your core— the pay per view. That’s essentially your product, right? And then, you know, you have spinoff things.” While the UFC has added other facets to their revenue streams, the central profit center for the UFC are their PPV’s. That is the paradigm they know and are comfortable with, and one that they will look to replicate.
It is key to remember who they have placed as their chief man in the UK/Europe. Marshall Zelaznik is the UFC UK President, but his roots are in the PPV industry. Zelaznik was plucked from PPV heavyweight In Demand to head up the UK effort.
So it looks like everything is built around the idea of pushing more PPV profits. I wonder how that business model will work out for them as technology advances and the pay per view system itself changes? We’re talking 5 to 10 years from now, but still … major shifts in how entertainment is provided are on the way. I know Lorenzo Fertitta has a boner for ‘on demand’ technology and every event can already be bought over the net from Yahoo Sports. Will these avenues increase the UFC’s ability to sell shows at 40 bucks a pop, or is the model doomed in the long run?