UFC Tries To Prove It's Capable Of A Knockout

On the afternoon before one of the biggest mixed-martial-arts fights of 2012, a group of Ultimate Fighting Championship employees takes up position in a sun-blasted parking lot outside the Mandalay Bay Resort and Casino. It's July in Las Vegas. It's 103 degrees of unpleasant. And it's about to get worse--because UFC president Dana White just tweeted their location. White is giving away 20 $1,200 tickets to this weekend's UFC 148 (most fight cards are named by number), headlined by a rematch between Brazilian middleweight champion Anderson Silva and his American nemesis, Chael Sonnen. Any fan who shows up within 20 minutes with a can of UFC-branded Edge shave gel will be entered into a ticket raffle.

It takes less than 10 seconds for Isiah and Dominique Quintanilla, teenage brothers from Visalia, California, to materialize from the back stairs with cans. "Some guy offered us $66 for one," Isiah says. UFC fans, it seems, had cleaned out drugstores on the Las Vegas Strip.

Minutes later, a horde bursts from the casino--mostly men in the UFC's coveted 18- to 34-year-old demographic, but women, too, in a dead sprint. They stampede toward the UFC team, grooming products in hand. Some hurdle a chain in the parking lot. One woman tries to scale a fence and bloodies her knee. In the fight business, these fans are known as hardcores. They buy the UFC's pay-per-view shows, which blend wrestling, Brazilian Jiu-Jitsu, Muay Thai, and other combat styles into an action-packed, often-bloody sport known as mixed-martial arts, or MMA. They buy apparel and merchandise. Above all, they buy into a UFC lifestyle that celebrates everyone's inner warrior.

"Fighting is in our DNA," White likes to say. It's an easy sell. But that dismisses a larger achievement: In a decade, the UFC turned what was essentially a no-holds-barred spectacle banned throughout the country into a sanctioned sport with mass appeal. MMA is now one of the country's fastest-growing sports. And the UFC has become one of the world's most valuable sports franchises, with annual revenue approaching $600 million, according to one of its owners--and a worth, if you believe the smoke signals, of more than $2 billion. That's more than the New York Yankees, more than the New England Patriots, more than Real Madrid. And there's seemingly more to come. In 2011, the UFC signed an unprecedented $700 million deal to air fights in prime time on Fox, the goal being to turn fringe fans into "casuals" and casuals into hardcores. Fight sports have been extremely rare on prime-time network TV since the 1980s.

Now the UFC is at a critical juncture. It could join the country's major sports leagues--an ascension fueled by big profits, network TV acceptance, and aggressive international expansion. Or, the UFC could mismanage its growth--by fatiguing fans with too many events, failing to resolve labor tensions with fighters, or simply overreaching. And, of course, there's an inherent question the UFC is finally large enough to confront: Is this sport too violent to thrive in mainstream America?

On that last point, especially, White already has his answer. When the last Edge cans are collected, he wades into the mob to cheers of "Da-na! Da-na!" As UFC publicists never fail to mention, you don't see NFL commissioner Roger Goodell doing this. You don't see the NBA's David Stern. Hell, the MLB's Bud Selig barely knows how to use a computer. White, on the other hand, is an Internet-age P.T. Barnum, or Don King on Twitter minus the hair and a murder rap. He stands there for an hour in heat that could bake an apple. He poses for every photo and bro-hugs every bro. He stays until the last fan is gone.

But when White and Fertitta attended UFC 27 in New Orleans in September 2000, they were stunned by the empty arena and the anemic marketing. "There was no buzz at all," Fertitta says. "We're literally sitting in the front row and I'm going, 'This has gotta be one of the worst-run businesses. What is missing here? There could be much more to this.'"

The UFC was a victim of its own gore. In its early days, there were no weight classes, no time limits, and only two banned moves: eye gouging and biting. Fighters could surrender (and still can, by tapping out), but promoters played up the death-match atmosphere. That prompted Senator John McCain to successfully petition governors around the country to ban MMA. McCain also pressured cable companies to take the sport off the air. Although the UFC adopted better rules--reating about 30 fouls, such as throat strikes and head butting--it was too late: The company was near bankruptcy. A month after White and Fertitta's New Orleans visit, it went up for sale.

White persuaded Fertitta and Frank III (known as "Three Sticks"), who now runs the family casino business, to take a chance. The Fertittas plunked down $2 million and gave White a 10% stake in the company; in exchange, he took over running day-to-day operations. Now they looked crazy. But Fertitta had served on the Nevada Athletic Commission, which oversees boxing, a sport deep into its nosedive by 2001. "We felt like we had a better product than boxing," he says. "It was the next evolution. But it was as much about the brand as anything."

The new owners began an arduous process of rehabilitating the company's image by further increasing safety measures and working with states to lift their bans. But news coverage was slim, and pay-per-views didn't sell. By 2005, the UFC was $44 million in the hole, and the Fertittas were covering expenses from their personal accounts. They decided to take one more chance.