Violent, bloody and lucrative: UFC is big business in Australia
It’s about to gross more gate revenue than any other arena event in Australian history. UFC 293 in Sydney’s record-breaking $8m success shows just how much the controversial sport is now worth.
It is violent, controversial and sometimes bloody.
And it’s about to gross more in gate revenue than any other arena event in Australian history.
The Ultimate Fighting Championship (UFC) mixed-martial arts event at Sydney’s Qudos Bank Arena that starts on Sunday morning is expected to make more than $8m in ticket sales alone.
More than 10,000 people from interstate and overseas have flocked to Sydney for the event, which sold out roughly 19,000 seats at the indoor stadium at Olympic Park in only 13 minutes.
Sunday’s 12-bout fight card is likely to generate more than $50m in economic output. And with coverage on prime time television and pay-per-view platforms in North America, it will also give Sydney and NSW plenty of major event exposure.
The NSW government will consider the $16m funding it gave UFC owners TKO Group Holdings to hold three UFC events in the next four years money well spent. The $US10bn ($15.7bn) TKO will soon be listed on the New York Stock Exchange.
In short, UFC has become hugely lucrative and attracted huge interest, according to Peter Kloczko, its vice-president, Australia and New Zealand.
“We’re not just going to break the arena (record) for any single event, sporting or otherwise – we are going to smash it,” Kloczko tells The Weekend Australian.
“Tickets start in the low $200 level and go up to $6000 for ringside seats.
“But there’s also other fan experiences that people are buying for $10,000 or more.”
But with the money comes a lot of controversy. Star American fighter Sean Strickland attracted plenty of notoriety this week, making sexist comments at a press conference – such as “women … need to stay home and raise a family” – while wearing a “cancel me” T-shirt.
Strickland later admitted to punching a fan in Bondi. Kloczko is reluctant to discuss incidents such as these in great detail, but says: “Our athletes are quite diverse and we do want them to be authentic to promote our events.
“That’s what really engages our fans.”
UFC’s huge following and ability to generate revenue means state governments are supportive, despite the controversy. UFC 284 in Perth in February set the previous area gate record – about $6m – and had economic output of about $42m, and the NSW government would expect even more bang for its buck.
“The UFC is an internationally recognised, extremely popular sport. Just like boxing, just like wrestling,” NSW Sports Minister Stephen Kamper recently told state parliament.
“UFC has got an enormous following across the world. It’s not my call whether Mr Strickland participates, but we support the UFC and we’re looking forward to the UFC.”
Kloczko says research undertaken for UFC shows that it has more than a million female fans in Australia alone, and that 48 per cent of adults aged 18 to 34 claim to be UFC fans – more than local sporting competitions such as the AFL and NRL.
“UFC is very much brand-led and fight fans know what to expect. They know they are going to get great fights from start to finish, and we will have about 10 athletes from Australia or New Zealand competing.”
In Australia, more than 73 per cent of UFC fans are aged 18 to 44, meaning that UFC fans tend to skew younger than most other sports. The Australasian arm of the business established its own TikTok account at the start of this year and already has more than a million followers.
Kloczko says younger fans should help the organisation attract more sponsors, particularly local Australasian backers, who want to connect with a demographic that is usually harder to reach.
UFC has also signed a new deal with Foxtel to be the Australian exclusive pay-per-view provider for five years from 2024 onwards. Kloczko says typically the first two hours of events, which can stretch to six hours, will be shown on ESPN, and then the remaining bouts will be pay-per-view at a cost of $59.95.
Globally, UFC is about to account for one of the bigger new listings on the NYSE when TKO Group Holdings, the $US9.3bn ($14.6) merger of UFC and World Wrestling Entertainment (WWE), is floated by current UFC owner Endeavour Group Holdings.
UFC was started in 1993 and was majority-owned by Las Vegas casino entrepreneurs Frank and Lorenzo Fertitta and president Dana White before Endeavour led a consortium including private equity’s Silver Lake in a $US4bn buyout.
Endeavour later bought out its partners as part of its April 2021 IPO and has since helped build UFC into what is says is one of the most popular sports organisations in the world, with 700 million fans globally.
The prospectus for TKO Group shows revenue for the full 2022 calendar year reached $US1.14bn, up from $US1.03bn a year earlier. Adjusted EBITDA was $US628.7m in 2022, up from $521m for 2021.
Broadcast rights account for about 70 per cent of revenue, live events about 11 per cent, sponsorship 15 per cent and consumer products such as trading cards and games almost 5 per cent.
Revenue increased $US84.2m or 16 per cent to $US611.9m for the six months ending June 30, compared to the previous corresponding period.
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