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With ESPN+ deal, money is coming for UFC, but day of reckoning is too

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Sold out Manchester Arena for UFC 204
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With little more than a half-year remaining in the UFC’s television rights contract with current broadcast partner Fox Sports, the future of the combat sports giant is finally starting to come into focus. The first domino fell on Tuesday morning, when it announced a multi-year agreement with over-the-top digital service ESPN+.

With the ink dried on the deal, the UFC is now married to the Walt Disney Company. That union—that statement—would have sounded ludicrous even a decade ago, but in 2018, its seeming improbability goes nearly without mention.

I can see the crossover possibilities already: Mickey Mouse & Mighty Mouse; Mulan & Rose Namajunas; Demian Maia & Yoda.

The pact is a sign that the UFC push toward mainstream is nearly complete. The deal, for five years at $150 million per year according to Sports Business Daily, is just the start of the UFC’s cash haul. The promotion is still in the midst of negotiating its television home, with FOX Sports, NBC Sports and Turner Sports all rumored to be in the running for what is expected to be an even more lucrative deal.

While regular viewers of the UFC have considered the organization’s recent stretch to be a bit lackluster, it seems clear that sports executives continue to see value in the brand, making it heady days in the UFC offices.

The money is its own reward, but an additional hope for the UFC is that the ESPN relationship will be beneficial in providing exposure for its athletes. ESPN has historically given the majority of coverage on its mothership station to sports it’s invested in. While no UFC events will air on the main cable channel, it’s a lock that UFC athletes, highlights and event previews will get more Bristol love.

Even with its recent losses, ESPN is available in around 87 million homes, according to The Hollywood Reporter, and it remains far and away the top tastemaker in American sports. This is the pairing that Dana White and the UFC executive leadership has dreamed of for years. It is the grail. In their estimation, the only thing that can follow is money, and in some ways, they are right. By virtue of this deal and the one to come, the UFC’s coffers are threatening to burst.

All of that cash, though, is generated by the people who have patronized the product, and it remains to be seen whether these changes will ultimately help or hurt the audiences. In announcing the move, the UFC confirmed that ESPN+, which costs $4.99 monthly, would livestream 15 events per year. A source with knowledge of the specifics told MMA Fighting that those shows will include each event in its entirety, from the earliest prelims to the main event.

What that likely means is that there will be a decrease in live UFC fights on Fight Pass, the promotion’s own $9.99 monthly over-the-top service.

While the source said Fight Pass is expected to continue to host a few live cards per year, fans will be faced with yet another decision on how to stretch their entertainment dollars. In any given month starting in January, they will have to decide whether to spend $65 on pay-per-view, $9.99 on Fight Pass, and $4.99 on ESPN+.

While $4.99 sounds like a reasonable fee to catch someone like Francis Ngannou, Justin Gaethje or Brian Ortega, in a time of flat wages, it’s no small thing. For some, the cost of entry into fandom is prohibitive, and that’s a problem when the goal is to continue growing the sport.

While the UFC is framing this move as providing the fans with several options, it is also a stark departure from the 2011 FOX deal, which the promotion lauded for putting its entire inventory within one broadcast provider.

To be sure, it’s a vastly different media landscape seven years later. At the time the UFC on FOX deal was announced, live streaming was barely a business model, and there were questions over whether it would ever work. In October of that year, for instance, Netflix stock plunged by 35 percent in a single day, in what one analyst called a “nuclear winter scenario” for the company. That misguided calculation clearly illustrates the difficulty in predicting the future of entertainment and the viability of its still-evolving platforms.

Still, it seems clear that for the UFC, a reckoning is nigh. The price of being a UFC fan continues to go up, with now at least 27 events—12 pay-per-views and 15 ESPN+ shows—costing money apart from the cost of a regular cable subscription. That leaves only about 13 events out of the planned 40-something schedule to air on network or cable, a marked decrease from the 22 of 2017.

And that means that at some point, decisions must be made. It’s certainly possible that many fans will determine their cash is better spent at either ESPN+ or Fight Pass, but not both. It’s also possible that some will become disillusioned with having to make the decision and stick to the cable-only or network shows. And worst of all, it could lead to some saying goodbye altogether. In the end, fans will either pay up or revolt. ESPN and UFC have made their bet on which it will be, but any which way, a day of reckoning is coming.

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