Quebec backs down and UFC shows big strength
Published by Zach Arnold on February 20th, 2009 in Current Events

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The week leading up to last Tuesday night’s meeting between UFC management officials and officials from the RACJ & Quebec Boxing Commission was truly a game of political chicken. With millions of US dollars on the line based on UFC 97 taking place at Montreal’s Bell Centre on April 19th, MMA’s only major promotion was left with a possible prospect of having to relocate the event to the MGM Grand Garden Arena.

Why?

The RACJ, in the past week, had been claiming that they were not going to play by the Unified Rules of MMA. The Unified Rules, which originally gained steam thanks to the same Quebec Boxing Commission and New Jersey State Athletic Control Board a little over a decade ago, are the rules that UFC has pushed into prominence as the standard in which fights are regulated. For the QBC to suddenly reject the Unified Rules due to new politicians taking over slots on the commission signified a high-stakes game of poker. Who was going to call the other’s bluff? On paper, the politicians had no common sense backing up their bluster — the UFC 97 event will generate millions of dollars for Montreal’s city economy with fans from all over the world going to the event to watch two top Brazilian fighters fight in the main event. While the QBC stands to make not a lot of money from the show based on their % cut, the reality was that UFC held all the cards in negotiational power. Eventually, the QBC backed down and allowed the UFC 97 event to take place with the provision that foot stomping on the ground would not happen.

The near-debacle in Quebec demonstrates what kind of financial power and momentum is currently on the side of Zuffa. At a time when the economy has hit all sports hard, it is not affecting UFC. With three straight domestic PPVs drawing 800,000 or more buys, the company is on rock-solid footing at the moment. Every day, sports fans read about bad stories in basketball (15 teams reportedly had to take out $12M USD loans from the NBA) or football (teams such as the Carolina Panthers laying off 20 employees). However, there’s no bad news in the land of Dana White. He’s pushing the envelope and laying the groundwork for the company to advance into Mexico. The organization just inked new TV deals in Europe. And with the Montreal event back on schedule, UFC is truly making a global push that other sports and sports leagues could only dream of in the current economic climate.

The long-and-the-short-of-it is that UFC’s financial model is proving to be both successful and prudent in these challenging economic times. Their formula for cutting fighters, signing new fighters, and being able to be flexible on a global stage has truly served them well. The organization is not tied up to expensive contracts like teams in other sports are. PPV revenues are doing very well thanks to a new contract the organization recently signed with PPV distributors. Fan interest continues to increase, and all of this good news is happening while UFC is doing business exactly on their own terms without having to sacrifice or give up any ground. Vince McMahon would be proud of this if it was his happening. He’s not so happy that it’s a major PPV competitor that is accomplishing this.

Despite a weak advance in London for the UFC 95 event (headlined by Diego Sanchez vs. Joe Stevenson), UFC’s core business remains red hot. It may be tougher to sell tickets live when prices are $500USD, but selling $50 PPVs doesn’t seem to be hard to accomplish. With major shows coming up in March in Columbus, April in Montreal, May & July in Las Vegas, and June in Germany, the organization is ready to run the table for the rest of this year and close out with a significant amount of steam. If UFC had been forced to back out of Montreal and run Las Vegas with Anderson Silva headlining, they would have did just fine selling tickets thank you very much. However, now that the Quebec Boxing Commission softened its stance, more than 20,000 fans will be at the Bell Centre to watch one of the two best MMA fighters on the planet fight in the main event. A message was clearly sent this week by Zuffa and the politicians in Quebec received it loud and clear — take our money or we’ll go elsewhere. This was a proposition that politicians simply couldn’t refuse.