Saturday, March 7th, 2020.
That was the date of UFC 248 and the middleweight championship of the world between title-holder Israel Adesanya and Yoel Romero. The event attracted over 15,000 fans at T-Mobile Arena in Las Vegas and garnered nearly $3 million in ticket sales.
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One week later, the NBA, NHL, MLB, combat sports, European soccer leagues, and the world was on pause. The week following UFC 248 consisted of Rudy Gobert’s positive Covid-19 test, the first positive test from a major athlete, along with national lockdowns, the likes of which this country has never seen. No fans would be attending games for weeks on end. At the time no one knew how severely impacted each league would be. How long would it be before play was restarted? Would there be fans? Could the NFL and college football start in August? 10 months later the report cards are in.
Let’s start with the National Basketball Association. Soon after play was stopped and it appeared that the pandemic would not be ending any time soon, it was clear that negative economic effects were impending. In terms of revenue, the NBA’s annual revenue for the 2019/20 season dropped 10% from the previous season. With no fans for the last portion of the regular season and the entire postseason, this makes sense. Also, the NBA’s salary cap, the designated amount of money each team is allowed to spend on players, did not increase for the first time in six years. In fact, according to recent reports, due to the impact of no attendance once again for the majority of the 2020/21 season, the NBA is mulling expansion and considering adding two additional franchises. The league has not expanded since 2004. The catastrophic financial losses are expected to be temporary for the NBA. As the vaccine rollout continues across the country, there is optimism that later this year the great atmospheres in NBA arenas will once again return.
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The Ultimate Fighting Championship, commonly known as the UFC, was certainly the most ambitious sports organization during the spring. While the NBA did not resume play for over 4 months, the UFC managed to take just a 2 month hiatus (They were actually prepared to do a fight in mid-April but their television partners were against it). Since May, they have put on massive fights with the likes of champions Khabib Nurmagomedov and Kamaru Usman fighting during the pandemic. According to Dana White, the UFC brought in more total revenue in 2020 than they did in 2019, a year in which they brought in $900 million. Without fans, this is highly impressive. Though the UFC is still raking in massive pay-per-view numbers, the main economic effects from the lack of attendance is on the city of Las Vegas. The Las Vegas economy has been hit hard. Among large metropolitan areas, Vegas has the highest unemployment. The UFC, casinos, and hotels in Sin City are hopeful that the amazing fights and raging night life can return in 2021.
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The NFL has been able to host fans at limited capacity since September, but with the Super Bowl approaching in early February, the United States’s premier sports event will feel a lot different. Normally seats in the nosebleeds sell for hundreds if not thousands of dollars. While the attendance will suffer in at least the first half of 2021 for teams, the product of pro sports on live television is still stronger than ever. No live show or live event is more valuable than live sports. And although the leagues and corporations around the world are suffering today, the demand for sports in-person will be the highest that America has ever seen coming out of the pandemic. Expect a boom in ticket sales in late 2021 and early 2022. Sunnier days are certainly on the horizon.
Sources:"NBA Salary Cap History"
"REPORT: Unemployment rate decreasing in Nevada, below 10% for December"
"Unemployment Rate in Las Vegas-Henderson-Paradise"
Pay Per View Buys
Sources: UFC 253 generated more than 700,000 PPV buys globally