ESPN and the UFC shifted the pay-per-view event landscape Monday when the two parties announced an exclusive, multi-year deal to distribute all UFC PPV events on the ESPN+ streaming service.
The deal delivers a major body blow to linear PPV event distributors who will not longer be able to count on the UFC’s monthly PPV event revenue, which had been stabilizing the event category while boxing continued to build its next generation of PPV champions.
The move is similar to the WWE’s decision in 2014 to move all of its PPV events to its WWE Network streaming service, allowing pro wrestling fans to watch Wrestlemania and other monthly WWE PPV events as part of the service’s $9.99 per month fee. The big difference is that linear distributors like In Demand and DirecTV have the option to distribute the WWE’s events if they choose.
With the new two-year extension of ESPN and UFC’s three-year, $1.5 billion distribution deal that launched in January, only ESPN’s $4.99 streaming service ESPN+ has the rights to distribute UFC PPV events, beginning with the April 13 UFC 236: Holloway vs. Poirier 2 event.
New subscribers to ESPN+ can pay $79.99 for access to one year of the service as well as UFC PPV event, while existing customers can buy the events for $59.99 each.
Prior to the new deal announcement, ESPN and UFC executives said they were pleased with the early performance of PPV events both on the ESPN linear channel and on the ESPN+ service. ESPN executive vice president, programming and scheduling Burke Magnus said the UFC was one of the primary engines to get ESPN+ to 2 million paid subscribers earlier this year. Nearly 570,000 subscribers signed up for ESPN+ in January prior to the streaming service’s first UFC telecast.
“The UFC has certainly been an enormous part of that trajectory for ESPN+,” said Magnus.
On ESPN’s linear channel, its telecasts of preliminary fights leading up to the three PPV events, as well as other UFC fight cards, averaged 1.4 million viewers -- more than double what FS1 was averaging for similar UFC event telecasts last year.
“We’re really happy … we’re ahead of expectations on both sides of the equation,” said Lawrence Epstein, UFC chief operating officer.
The departure of the UFC makes boxing the default, undisputed champion of the PPV event category for In Demand and other linear distributors, as well as major source of revenue.
This past Saturday the PPV event category welcomed Fox Sports into the ring sports arena with its first ever pay-per-view event as boxing fans watched undefeated welterweight champion Errol Spence dominate multi-division champion Mikey Garcia. While PPV buy numbers aren’t in yet for the fight, Fox says it could distribute as many as five PPV boxing events this year.
ESPN and Top Rank will offer an April 20 Terence Crawford-Amir Kahn welterweight championship fight, marking the first time ESPN and Top Rank have co-promoted a major PPV boxing card since the two reached a distribution agreement in 2017.
The key for the linear PPV industry now is to find other sports and event properties to fill UFC’s major shoes. Turner Sports has said it would look to do events similar to last November’s Tiger Woods-Phil Mickelson golf challenge. The UFC’s departure could open the doors for other sports event providers to step into the PPV ring.