Fox Sports and ESPN stepped bigtime into the ring sports arena last week, paying significant dollars to pin down television rights to WWE and UFC content respectively.
Fox Sports reportedly paid more than $1 billion to acquire rights to the WWE’s weekly live series SmackDown, which averages more than 2.5 million viewers every Tuesday night on USA Network.
The franchise reportedly will become the cornerstone of Fox broadcasting’s Friday night lineup, offering a two-hour block of live, action-based content featuring the WWE’s lineup of male and female Superstar performers.
USA is expected to retain its WWE Monday Night Raw franchise, the most watched series on the network. The three-hour live show averages nearly 3 million subscribers up against typically strong cable and broadcast fare year-round, as well as ESPN’s Monday Night Football telecasts during the fall.
ESPN entered the UFC octagon in a major way, securing exclusive television rights to the mixed martial arts outfit’s live shows for a whopping $1.5 billion over five years, more than double the revenue that the UFC generated from its current seven-year deal with Fox that expires at the end of 2018.
ESPN, under new president Jimmy Pitaro, is hoping UFC fans will pony up $4.99 a month for the network's new ESPN+ direct-to-consumer service to get 20 live UFC fight cards a year -- part of an overall 42 live events that ESPN will offer via its linear channels and digital app.
The deal also allows for the UFC to continue to offer 12 pay-per-view events a year, with ESPN becoming a distributor of those PPV events alongside traditional PPV outlets like In Demand, DirecTV and Dish. It will be interesting to see how the UFC renegotiates its current PPV event revenue splits, which expire at the end of the year.
The WWE SmackDown and UFC TV agreements further illustrate the value that premium live sports and live sports entertainment still command in a very crowded television marketplace. With traditional media companies like ESPN, Turner and Fox -- as well as new media companies like Amazon, Google and Twitter -- all aggressively bidding for live sports rights, industry observers expect a media royal rumble when TV rights to the major professional sports leagues come up in a few years.
“You have a fixed number of sports properties, and you have more companies on various platforms eager to put them on the air,” said sports consultant Lee Berke. “You’re going to continue to see them bid aggressively and you may see several properties moving.”
