UFC’s Latest Business Involves Moving Fight Cards to New Locations

A significant aspect of the UFC’s recent business strategy revolves around site fees and incentives paid by cities, states, or countries to host major events.

For instance, the upcoming UFC card in Saudi Arabia on June 22 exemplifies this approach. The Middle Eastern country reportedly paid around $20 million to bring the UFC there for the first time.

Weeks before the event, Turki Alalshikh, chairman of Saudi Arabia’s General Entertainment Authority, announced a new deal with the UFC to host another event in 2025.

Additionally, Riyadh Season, the annual music, arts, and sports festival, will sponsor the upcoming UFC 306 card in September at Sphere in Las Vegas.

While financial details were not disclosed, TKO Group Holdings President Mark Shapiro shed light on the lucrative business of UFC site fees and their central role in the promotion’s strategy moving forward.

“Big opportunity and a big part of our strategy,” Shapiro said during the JP Morgan Technology, Media and Communications conference. “I spoke up front [about] our major KPIs (key performance indicator) that we’re working, which is attendance and pricing and site fees.

“Look, if we are going to bring the show to town, we are looking for an incentive package. It doesn’t always have to be straight cash, but it has to be a significant incentive package. Because once again, demand is outstripping supply.”

Site fees essentially boil down to the money and incentives provided by a city, state, or country to secure a major UFC card.

Upfront cash can certainly be part of the deal, such as Saudi Arabia putting down $20 million to host a single event. In other cases, a city or state might cover the costs of marketing and advertising or offer tax incentives to land a UFC fight card.

Regarding the latest deal with Saudi Arabia, Shapiro did not disclose the exact amount paid by the UFC but suggested that it could potentially approach $40 million for a single event based on the original site fee.

“You’ve seen us monetize site fees with the likes of Saudi Arabia with WWE,” Shapiro explained. “You can look for us to expand our current deal in the next six to 12 months.

Very happy with MBS (Mohammad bin Salman) and the partnership we have there. We have two events a year, but we’re already in discussions — Nick Khan is leading that for us — in expanding that to more events.

We also have a phenomenal deal in Abu Dhabi with the UFC where we’re getting significant site fees and incentive packages there, and we’ve now expanded our partnership with them for other affiliate events, if you will, in the Middle East that they would participate in as we sell them to different countries.

“We’ve now expanded our Saudi Arabia relationship by not just having a UFC fight this June, but announcing — for almost double the rights fee — another event next year. I would tell you we would be doing a longer-term deal with Saudi Arabia if we already had one event under our belt.

So that’s another way of saying as long as everything goes well in June, which we anticipate, I think Dana White would be very amenable to doing a much longer-term deal in Saudi Arabia.”

Shapiro highlighted the high demand for UFC, making it logical for the promotion to seek site fees from locations hoping to host a fight card.

Cities and countries worldwide are already investing substantial sums to secure a UFC pay-per-view event, with the promotion traveling to locations like Newark, N.J., in June, Manchester, England, in July, and Perth, Australia, in August.

Shapiro anticipates that even UFC Fight Night cards will eventually command substantial fees, citing a recent event in St. Louis as proof of the demand.

“We’re getting site fees for our pay-per-views in the UFC — significant by the way here in the U.S. and internationally, but specifically here in the U.S. — and we’re going to start to ask for those same incentive packages to bring [WWE] Raw to town, to bring [WWE] Smackdown to town, to bring our Fight Nights to town,” Shapiro said.

“So we just had a UFC Fight Night a week ago in St. Louis, we did the highest gross for a Fight Night in the history of the UFC in St. Louis. Highest ever.

“We’re just talking a regular card. I was actually there. Budweiser’s our partner, that’s their home, tremendous event, and that’s what happens when you haven’t had the UFC there since pre-pandemic.

The demand and thirst is so insatiable that the audience is ready to come out and spend record sums on tickets.”

As part of the initiative to seek out site fees and incentive packages, TKO announced that the live events group in UFC and WWE are merging under the leadership of Peter Dropick, a longtime UFC executive now serving as executive vice president for event development and operations at TKO.

The directive for the new combined live events group is to “drive revenue growth strategies across key areas, including live event development and scheduling, tourism incentive programs, ticketing, and fan experiences” for UFC and WWE.