Billboard Rec Sports DVD Chart - 5/17

1. WWE: Triple H: The King Of Kings
2. NFL: Super Bowl XLII Champions New York Giants
3. UFC: Best Of 2007
4. UFC 79: Nemesis
5. WWE: The Best Of Raw: 15th Anniversary 1993-2008
6. WWE: The Legacy Of Stone Cold Steve Austin
7. WWE: No Way Out 2008
8. 2001 FedEx Orange Bowl National Championship
9. TNA: Best Of TNA 2007
10. UFC: The Ultimate Fighter: Team Hughes Vs. Team Serra

TUF 7 Rating - Week 6

This week's episode of the Ultimate Fighter on Spike drew a 1.0 rating (1.2 million viewers). The program drew quarter hours of 0.93, 1.1, 0.96, and 1.06. The key demographic numbers were a 1.20 in M18-49 and a 1.34 in M18-34.

Dion-Vera Suit Accuses Zuffa, White, & Silva of Interference with Contract

It appeared that the management dispute between Mark Dion and Brandon Vera was resolved in an arbitration hearing in front of the CSAC earlier this year. However, MMAPayout.com has learned that Dion filed suited against Vera and his new management team in civil court in California on May 1.

The complaint closely follows the contours of the arbitration proceedings, except for the inclusion of Zuffa, White, and Silva for allegedly interfering with Dion's management contract with Vera. Specifically the complaint alleges that Zuffa and its officials encouraged Vera to breach his contract with Dion and provided him with confidential emails to use in that effort.

News Wrap

• UFC Tackles Long Term Growth Issues - The last five pay-per-view events have produced three of the company's top ten events according to Dave Meltzer. UFC 79, 81, and 83 all drew between 525,000-650,000 buys and at $44.95. UFC 79 and 83 also produced the second and third largest gates in company history.
  
• Golden Boy Sticking to Boxing - Oscar de La Hoya recently said that Golden Boy will stick to boxing when asked about MMA.
  
• Viacom CEO Praises Iron Ring - Q1 profits for Viacom were up 33%. CEO Philippe Dauman said, "content creation is our central mission and our ongoing investments in programming are paying off as we see our television ratings continue to improve. Successful new programming across our networks during the first quarter included MTV's Randy Jackson Presents: America's Best Dance Crew, TV Land's High School Reunion and BET's Iron Ring among others, which joined new seasons of several proven audience favorites."
• Another Affliction Deal Falls Through - Negotiations with HDNet have reportedly fallen through. The promotion is now less than two months from its proposed first show and without a venue or television partner.
• UFC Targets Show for Latino Audience - El Octagono will debut on Galavision as the UFC attempts to expand MMA's demographic reach outside of 18-34 white males.
• WWE Q1 Results - Wrestlemania XXIV produced $31.3 million in revenue and $7.1 million in profits ($4.6 million net). The event drew 1,058,000 buys (including international).
  

Counter Programming

In case you were wondering whether or not the UFC believes that a rising tide lifts all ships:

On Saturday, May 31, the best mixed martial arts programming on television will be on Spike TV, as the network presents a special night dedicated to UFC® superstar Chuck "The Iceman" Liddell. The homage to Liddell will feature two Spike TV premiere events not to be missed by true UFC fans.

At 9:00pm ET/PT, Spike presents the world television premiere of "Ultimate Iceman: Chuck Liddell," an hour-long documentary which chronicles the life of one of the sport’s true titans, in and out of the Octagon™.

Spike debuts a special, "Liddell vs. Silva: UFC® Unleashed™-Special Edition" at 10:00pm ET/PT featuring the never-before-seen on cable battle between Liddell and Wanderlei Silva, which was fought last December at UFC 79: NEMESIS.

Friday Afternoon Quick Hits

Three articles worth reading that I haven't had time to cover fully this week:

• 411Mania.com Interview w/ Jay Larkin - A very candid conversation with IFL CEO Jay Larkin on the state of the industry and the IFL.
  
• The Future of Golden Boy Promotions - Opinion and Analysis from CBSSports.com on the future of the company after Oscar de La Hoya retires which might explain the company's interest in MMA.
  
• Kevin Iole Defends the UFC Pay Scale - A defense of the UFC's pay scale, particularly compared to boxing, including some of the most detailed sponsorship figures that have been made public to date.
  

TUF 7 Rating - Week 5

MMAPayout.com has learned that this week's episode of the Ultimate Fighter on Spike drew a 0.9 rating (1.2 million viewers). The program drew quarter hours of 0.84, 0.91, 0.92, and 0.98. In the key demographic numbers were a 1.11 in M18-49 and a 1.34 in M18-34.

That is the lowest number is series history and continues this season's downward trend. However, the program was facing competition from the NBA playoffs.

Billboad Rec Sports DVD Chart - 5/10/08

1. WWE: Triple H: The King Of Kings
2. NFL: Super Bowl XLII Champions New York Giants
3. UFC 79: Nemesis
4. UFC: Best Of 2007
5. WWE: The Legacy Of Stone Cold Steve Austin
6. WWE: The Best Of Raw: 15th Anniversary 1993-2008
7. WWE: No Way Out 2008
8. 2001 FedEx Orange Bowl National Championship
9. UFC: The Ultimate Fighter: Team Hughes Vs. Team Serra
10. WWE: John Cena: My Life
    

Top TV Execs Criticize CBS's Decision to Air MMA

The most high profile push back against EliteXC on CBS was launched this week by Sumner Redstone, the highly influential and respected chairman of CBS and Viacom. According to a report by the The Hollywood Reporter:

"Les usually asks my opinion," Sumner Redstone said Wednesday when asked about the four mixed-martial arts fights that will begin airing soon on CBS. This time, the Viacom and CBS chairman said, Moonves did not.

Redstone said the deal, struck with Elite Xtreme Combat, probably was a mistake, not because CBS won't turn a profit from it but because it is not "socially responsible" to air the typically bloody bouts on free, broadcast TV.

"I'm a lover not a fighter," Redstone said. "I don't like the sport."

The comments were made during a panel discussion on the sports industry at the Milken Institute Global Conference. Redstone and Moonves have had a rocky relationship in the past, so perhaps some of Redstone's criticism can be attribute to their personal conflict. However, Ed Goren, President of FOX Sports, was also critical of MMA on network television, telling the audience "we don't need money that badly."

It is important to note that the UFC's rumored negotiations with FOX are with the entertainment division and not Goren's sports division.

Van Wagner Representing the UFC

MultiChannel reports that the UFC has inked a multi-year deal with Van Wagner Sports Group. Under terms of the deal, Van Wagner will help secure sponsorship opportunities for the UFC and WEC. The respected New York sports marketing firm's other clients include IMG, College Sports Television, World Cup Soccer, and Formula One Racing.

According to the article, "Van Wagner will work as an extension of the sales group of mixed martial arts franchises UFC and its sister MMA company World Extreme Cagefighting to help facilitate sponsorship deals for the organizations’ various pay-per-view and TV events."

UFC President Dana White on the deal:

We are pleased to be working with Van Wagner Sports and Entertainment in our venture to attract new media and sponsorships to the UFC and WEC. Fighting speaks every language and transcends every culture, and through this relationship with Van Wagner, we can increase visibility for UFC and the WEC – the biggest brands in the sport.

UFC Announces Secondary Ticket Market Deals

Yesterday the UFC announced a pair of deals in the secondary ticket market. Under the deals StubHub is now the "Official Fan to Fan Ticket Marketplace" of the UFC, while PrimeSport is the "Official Ticket Package Partner" of the UFC. According to the press release, "the deal promises to offer UFC fans the most user-friendly experience to buy and sell secondary tickets as well as exclusive package and hospitality opportunities that have never been available before for UFC events."

SEE ALSO: Upcoming UFC Advances and Secondary Marketplace Strategy

Latest on HDNet v. Zuffa: Resolution by End of Summer Appears Likely

On April 9, a Federal Judge remanded HDNet Fights' declaratory judgment action against Zuffa to Texas state court. The case was officially reopened on April 15 and the proceedings to determine Couture's contractual status are progressing quickly. With HDNet's lawyers reportedly pushing the pace, a resolution of the case by the end of the summer appears more and more likely.

Court records obtained by MMAPayout.com show that Zuffa filed a motion to dismiss on April 21, while HDNet filed a motion for summary judgment on April 23. The motion to dismiss is scheduled to be heard on May 19, while the motion for summary judgment will be heard on June 2. However, details on the case will become increasingly difficult to obtain thanks to Zuffa's motion to seal the proceedings.

NY Times Feature on WWE

Tomorrow's edition of the New York Times features a piece on the success of the WWE called Better Days, and Even the Candidates, Are Coming to W.W.E. The article focuses on the company's recovery from last years Chris Benoit scandal. Key exert (including Dana White quote):

Awash in cash, W.W.E. is investing globally. It currently shows programs in 23 languages in more than 130 countries, and is now concentrating on expansion in Latin America, China, India, Australia and Japan.

“Here’s the formula we’ve been using very successfully,” said Linda McMahon, the chief executive “We first introduce our product into the marketplace via the television show. Once we’ve introduced our talent and our story lines via television, then we follow with live events and licensing and merchandising.”

Such success abroad has come at an opportune time for W.W.E, which still faces considerable challenges at home. While the presidential candidates’ appearance on “W.W.E. Monday Night Raw” may attest to wrestling’s cultural significance in the United States, the show’s television ratings are down slightly year over year and it lost viewers in the 18-to-34 age group. Analysts say W.W.E. lacks the charismatic and marketable stars it once had.

Until recently, its domestic pay-per-view revenues had been declining, in part because of competition from the Ultimate Fighting Championship, the leading brand in mixed martial arts.

But Dana White, president of the U.F.C., said: “People have been trying to count the W.W.E. out for years,” he said. “They’re a powerhouse.”

TUF 7 Rating - Week 4

MMAPayout.com has learned that the fourth episode of the seventh season of The Ultimate Fighter drew a 1.0 rating (1.3 million viewers). The program drew quarter hour ratings of 0.94, 0.88, 1.00, and 1.06. The demographic breakdowns were 1.49 in M18-34 and a 1.25 in M18-49.

The quarter hours actually average out to a 0.97, which rounds to a 1.0, but the series is very close to breaking the 1.0 support discussed on MMAPayout.com last week. The number is also under the 1.5 million viewers Spike averaged in prime time in the first quarter.

Downsizing: UFC Planning Major Roster Cuts

One of the UFC's favorite talking points in demonstrating its dominance of the MMA industry is the number of fighters it has under exclusive contract. 250 is the standard talking point, although Forbes magazine reported it at 275. According to the Wrestling Observer Newsletter, the actual number is closer to 200, but not for long.

Dave Meltzer reported in the most recent edition of the newsletter that the company plans to cut its roster down significantly, perhaps to as low as 150 or less. The stated rationale is that the company is struggling to keep all of its fighters active, despite having recently increased cards from nine to eleven bouts.

The first casualty of the new policy appears to be Jake O'Brien who was cut after suffering his first career loss to Andrei Arlovski. Kalib Starnes is the latest announced cut, although he claims to have requested a release, but will not be the last. The recently announced move to cut the WEC Light Heavyweight and Middleweight divisions also fits nicely with the new policy.

According to Meltzer, the company's goal is three fights per year for contracted fighters. That number looks about right for the top fighters, but will likely be less well received by mid to lower level fighters who are accustomed to fighting 4-5 times per year at a minimum and depend on their fight purses to a much greater degree than more established names.

Money is another obvious factor in the move. The company is not doing as well financially as it was in 2006 with rumors of a round of layoffs at the corporate office and pressure to reduce costs. As the minimum contracted payouts slowly, but steadily, increase the incentive to sign and stockpile talent diminishes, particularly at the bottom of the card where it becomes cheaper to bring in new talent.

To some degree Tim Sylvia fits into this conversation as well, as an example that the days of simply paying what it takes to keep a guy are over. The company appears to be serious about containing its fighter costs and is willing to let some of its top fighters go.

Billboard Rec Sports DVD Chart 5/3/08

1. WWE: Triple H: The King Of Kings
2. NFL: Super Bowl XLII Champions New York Giants
3. WWE: The Legacy Of Stone Cold Steve Austin
4. UFC: Best Of 2007
5. WWE: The Best Of Raw: 15th Anniversary 1993-2008
6. WWE: No Way Out 2008
7. UFC: The Ultimate Fighter: Team Hughes Vs. Team Serra
8. UFC 79: Nemesis
9. WWE: John Cena: My Life
10. WWE: Undertaker 15-0

Update on UFC-FOX Negotiations

A quick follow-up on yesterday's story on negotiations between the UFC and FOX. MMAPayout.com has learned that the UFC is talking to FOX's entertainment division as opposed to its sports division. This was the company's same tack in negotiations with CBS and NBC. In theory, the promotion would enjoy greater editorial control as an entertainment property, which was reportedly a sticking point in its negotiations with HBO and CBS.

UFC on Network TV: Dana Says Deal Within 6 Months; FOX Rumored to be Frontrunner

Last week in an interview with the Canada's The Score, when asked about the UFC following EliteXC onto network television, UFC President Dana White said "we'll have a network television deal very soon." When pressed for a time frame, White said within six months.

MMAPayout.com has learned that FOX is now widely believed to be the leading candidate to become the UFC's network television partner. Earlier this month White met with FOX executives in Los Angeles. While a deal with FOX is not believed to be imminent, industry sources have told MMAPayout.com that they believe the companies are making progress toward a deal.

In February MMAPayout.com reported that the network was rumored to have made a bid to buy the UFC during a round of negotiations earlier this year.

Last month MMAPayout.com reported that the UFC was involved in "extensive" discussions with ESPN. Sources tell MMAPayout.com, that the network has not made a decision on whether or not to get involved in MMA.

It should be noted that this is an unconfirmed report. As a result, it should be considered rumor or informed speculation at best. It also bears mentioning that the situation is fluid and can change quickly.

Sports Business Journal Offers MMA Industry Reality Check

The following article was originally published in the April 21 edition of Street & Smith's Sports Business Journal and is republished here with permission. Thanks to Dan Kaplan and Richard Weiss.

Filings Show 2 MMA Groups Financially Bloodied

By Daniel Kaplan

Two key players in the mixed martial arts industry may soon go down for the count, underscoring the significant financial volatility in the sport despite its tremendous hype.

International Fight League and ProElite Inc., the latter of which made waves in February by signing the first MMA broadcast contract, warned in securities filings last week that they may run out of money later this year. Both also cautioned they could have accounting irregularities that resulted in inaccurate financial reports.

“You have got maybe some 20 MMA groups around the world, and every single one of them is struggling,” said Jay Larkin, IFL’s chief executive. “In the last three or four months, 10 have either reorganized, folded, changed names or completely gone out of business. That is a very heavy casualty rate for a sport that is supposed to be the greatest thing since the NBA.”

IFL is looking to align with a media concern or another MMA outfit, Larkin said, though the three-year-old company also is confident of raising additional equity. The MMA industry must consolidate to survive, Larkin said.

MMA combines boxing, judo and other hand-to-hand combat disciplines.

The dominant company in the conversation is Ultimate Fighting Championship, the Zuffa Corp.-owned outfit that dominates MMA but does not release financial results. UFC, which has previously dismissed rumors in the MMA world that it is looking for a buyer, declined to comment for this story.

Standard & Poor’s in November downgraded Zuffa’s $350 million of debt, citing weak pay-per-view buys and poor results in England.

IFL, which has lost $31 million since its inception in 2005, said in its annual 10-K filing last week that it “will likely have a cash shortage which would disrupt our operations, have a material adverse effect on our financial condition or business prospects and could result in us being unable to continue our operations.”

ProElite, which lost $27 million in 2007 on $5.3 million in revenue, similarly disclosed in its 10-K filing that “our auditors have expressed substantial doubt about our ability to continue as a going concern.”

A ProElite spokesman, in an e-mail, said “The company is optimistic about its financial position improving.”

Later in its report, IFL stated, “Our auditors have identified a material weakness in our disclosure controls and procedures … due to insufficient resources in the accounting and finance departments.

“There is more than a remote likelihood that a material misstatement of the consolidated financial statements would not have been prevented or detected.”

ProElite also reported it has identified internal accounting control problems.

In 2007, IFL reported revenue of $5.7 million and a loss of $21.3 million. The company is cutting the number of events it stages from 13 last year to six or seven this year. Commissioner Kurt Otto, who earned $250,000 in 2007, was let go on March 31 and instead will be paid $10,000 per event as a consultant.

UFC is broadcast on Spike, while IFL has deals with Fox Sports Net and MyNetwork. ProElite, which recently signed renowned fighter Kimbo Slice, announced in February a broadcast package with CBS.

Advances for UFC 84 & 85

The Wrestling Observer Newsletter reports that UFC 84 (5/24 in Las Vegas) has a $2.5 million advance with 10,000 tickets sold. Ticket prices appear to have been scaled down after the disappointing results for UFC 81 in February. With four weeks still to go, a sellout seems nearly certain.

UFC 85 (6/7 in London) has also sold more than 10,000 tickets with a $2.3 million advance.