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Arum Flogs the UFC
Published August 25th, 2008

CHARLES JAY
Commentary on MMA history….as it’s happening

ARUM FLOGS THE UFC

As he was finishing up his promotion of the Miguel Cotto-Antonio Margarito fight, which by all accounts was a nice success for his company (Top Rank Inc.), boxing promoter Bob Arum was heard to say, “It’s tough selling tickets in this economy. The UFC guys say they sell out but that’s bullshit. What they do is give away the tickets and pay the 4% tax so they can say it’s sold out. Trust me, it’s not.”

Arum made reference to what he said was the UFC’s “business model,” which included not only misrepresenting the ticket sales for the sake of image, but also its monopolistic practices.

As far as the ticket sales is concerned, I don’t quite believe that. I believe the UFC sells its events relatively legitimately. And remember that unlike boxing events, it appears as if there is negligible value to mixed martial arts as casinos perceive it, although the tide may be shifting there. But they are not committed to pay hefty site fees for the shows. Therefore, they MUST be sold to ticket buyers, while casinos buy the entire live gate for many major boxing events, which leaves them to do with those tickets whatever they wish. Of course, I’m not saying Arum does not sell tickets himself, anywhere, but the fact is that boxing promoters have become conditioned to the point where the”packaging” model is the preferred one. That is simply not the case in MMA.

In fact, the business model in boxing, as it is done at the highest levels (and for a time, at mid-level) is characterized by the existence of two customers - a casino and a TV network - and as a consequence of that they had gotten out of practice in the fine art of selling tickets. The UFC has been much better at the “retail” side of things.

With regard to the economy, promoters are always going to be able to unload the most expensive stuff, because for that kind of customer, the state of the economy has a somewhat inelastic effect. But for the rank-and-file fan, the UFC has done a better job in attaining, retaining and maintaining the loyalty of that fan than boxing has. Yes, there are ethnic factors involved in the popularity of mixed martial arts. But by the same token, ethnic factors are a primary factor in why Arum has been able to thrive in what is certainly a lower ebb than usual in the boxing game. Top Rank has, for the most part, foregone the heavyweight division and has experienced much of its success in recent years by marketing to niche - the Latin boxing fan. In fact, Arum is far and away the busiest promoter in America when it comes to putting fights targeted to that demographic in cable television.

That’s to be admired, and in fact, perhaps the UFC can learn a thing or two about reaching the Latin market from what Arum and Top Rank have done.

But here’s the sort of quote where Bob kind of blows it:

“Affliction is on the warpath. One of the things they’ve been successful at, UFC spends a lot on promotion because they don’t pay their athletes. Their contracts will be running out and Affliction is going to get all the better fighters. If it’s a bet between UFC and Affliction, I’m betting on Affliction…How do you like that Dana!”

That’s being a player-hater. And it’s just bad positioning. To be acknowledging someone who, in your perception, is a competitor, as if THEY were the big dog (which is the way it comes off to me anyway), well, that creates a real triumph in the eyes of most observers for the UFC and MMA. Consider the transformation that has taken place. I remember I had a conversation with Dana White and Lorenzo Fertitta several years ago, when they expressed that one of their objectives was to earn some acceptance form the boxing press. Well, they have not only accomplished that with many members of it, they are actually in a position to discard them if they wanted to.

That’s what I call progress.

The point is, it wasn’t that long ago that boxing promoters used to essentially ignore the UFC and mixed martial arts altogether. But those days are gone. They seem to be aspiring to be where the UFC is right now, which is a place where the fan and the brand are living in a state of perfect harmony.

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August 31, 2008
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