UFC Plans To Sue Individuals, Despite The Cost Being More Than Any 'Loss'

from the someone-want-to-give-them-a-recap-how-that-worked-for-the-RIAA dept

Wed, Jan 6th 2010 9:58am — Mike Masnick

There's something that just drives some executives nuts about the idea that someone might access their content "without paying" directly for it. We saw this last year when music industry execs kept saying they had to stop going to war against consumers, but immediately followed that up by saying that none of that mattered if they couldn't stomp out "piracy." It's as if the second any sort of unauthorized use occurs, the entire "cost-benefit" analysis goes out the window. If it's costing you more to try to stop unauthorized access, and it's not working, and there are ways to embrace it that makes you more money, the solution should be simple: you stop worrying and start embracing.

Apparently that message hasn't gotten through to the folks who own Ultimate Fighting Championship (UFC). Perhaps it's not too surprising that such a group's only reaction is to fight, but when they even admit that fighting unauthorized access will cost more than any "losses," you have to wonder how any executive at the company keeps his job. That's a recipe for getting fired: "Hey, I'm going to undertake an action that will cost us more than not taking this action -- oh, and it's likely to piss off a bunch of our biggest fans as well."

This isn't a huge shock. Last month, a UFC exec was at that Judiciary Committee hearing about unauthorized access to live streaming sporting events, and played the role of the RIAA/MPAA lobbyists claiming "them stealers are destroying our business." Given that, it's no surprise that UFC is gearing up to go after both sites like Justin.tv and the individuals themselves. Apparently, UFC's fight-first, think-later execs haven't noticed how badly similar plans have backfired. Most of the streaming websites have pretty strong DMCA safe harbor protections, and suing users hasn't worked out particularly well for the RIAA. Furthermore, pissing off your fans? Yeah, not such a hot move.

Meanwhile, the Torrentfreak article above does a really nice job breaking down just how many people willingly pay huge sums to watch UFC events on Pay-Per-View, and how that number keeps on growing. There was apparently a dip in a recent fight, but TF notes that it probably had more to do with one of the headlining fighters having to back out. What does become clear is that UFC has no problem convincing huge numbers of people to pay up huge amounts to watch its events. Pissing off a lot of fans with ridiculous lawsuits doesn't make anyone more likely to buy.

Hell, even Joe Rogan, the comedian (and notorious hater of "joke stealers") who also acts as commentator for UFC seems to think this is a bad idea, saying: "I think that kind of stifles innovation. It stifles the direction the internet is going. I like things being out there. I think people are always going to buy UFC pay-per-views. You're going to get a much better experience watching it on your television than all stretched out looking fuzzy and pixilated. They're trying to protect their money, but the internet is a strange animal."

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Filed Under: copyright, lawsuits, sporting events, strategy, streaming, ufc
Companies: ufc

28 Comments

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ChurchHatesTucker (profile), 6 Jan 2010 @ 10:09am

I give it a week
Stupid Exec is Stupid
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Ima Fish (profile), 6 Jan 2010 @ 10:29am

"entire 'cost-benefit' analysis"

That's the problem with the government giving out monopolies. The receivers never learn how economics are supposed to work in a free market.

If you open a restaurant and someone opens another one next-door to you. You don't ask the government to extend your property line to encompass your competitor to run him out of business. That's complete nonsense.

But in the wacky world of virtual monopolies, it's quite common. Let's go back to the 1800s. Back then in relation to music copyright only covered published music. I.e., the publication of sheet music. So when player pianos were invented, there was no infringement because they did not used published music.

However, instead of competing with player pianos, they went to Congress and had their monopoly extended to include both publication and performance. Then they hit up the manufacturers of piano rolls up for their cut.

And that's why the copyright industry constantly pushes their monopoly. Because they can and they always win.
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ChrisB (profile), 6 Jan 2010 @ 10:31am

Rising tide ...
UFC pay-per-views are $50 for SD and $60 for HD. There were 16 events in 2009 (UFC 93 - 108), and about 12 were pay-per-view. It is expensive to watch all the events.

The problem the UFC is having is they want to crush all competition. Affliction had a couple of good events until they made up with the UFC. Strikeforce has sporadic good events and they are free. What the UFC doesn't realize is more events are better for the sport in the long run even though it might hurt them a bit in the short term. "A rising tide lifts all boats."

Another problem is if people hit some rough times and can't afford to watch the UFC, the only real alternative is to stop watching the sport. The UFC ties up its fighters, and there really isn't any mainstream commentary on MMA. This is due, in part, to the UFC not allowing independent commentators at their events. They just have Joe Rogan and Mike Goldberg.

So if the UFC was smart, they would tolerate a bit of infringement in order to keep people interested in the sport. If they crack down, they will strangle themselves.

The UFC was the best thing to happen to MMA, but could end up being the its death.
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Dark Helmet (profile), 6 Jan 2010 @ 10:57am

Re: Rising tide ...
"The problem the UFC is having is they want to crush all competition."

Agreed. I'm not a UFC guy, but for those not already aware there is going to be some absolutely nasty Supreme Court case coming up regarding the NFL's antitrust status. If it goes the way people are predicting it will go, you're going to be talking about no salary cap, which sounds like a win for the players. It isn't. Part of the cap is a salary "floor" minimum required spend of $109 million...when that goes away, it's going to absolutely KILL free agency, parity, and possibly the NFL as the nation's most popular sport.

All because the owners want more immediate money....
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Lucretious, 6 Jan 2010 @ 11:06am

This is too bad. Dana White seems more intelligent than this.
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Marcus Carab (profile), 6 Jan 2010 @ 11:09am

I'm not a huge UFC fan, but I totally understand and appreciate the sport. That was not always the case: I used to be in the "all they do is hug on the mat!" crowd (not entirely inaccurate, but oversimplified, like the "I don't care what you had for lunch" response to Twitter)

How did I make that transition? YouTube clips. People sending me clips of the best fights, or the best moments from the best fights -- many of which are pretty incredible to watch. Now I'll actually go out to UFC pay-per-view parties from time to time when there are fighters who I enjoy watching (but about whom I never would have heard without YouTube)

UFC is very stupid if they try to choke off such a great fan recruitment channel.
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ChurchHatesTucker (profile), 6 Jan 2010 @ 11:12am

Re: Re: Rising tide ...
"...when that goes away, it's going to absolutely KILL free agency, parity, and possibly the NFL as the nation's most popular sport."

But that will take decades. Meanwhile, the owners get paid.
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Anonymous Coward, 6 Jan 2010 @ 11:20am

I know a couple people who have gotten into UFC by torrenting the fights/show but who have since spent hundreds of dollars to watch fights live (and driven quite a long way to get there).
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Jon B., 6 Jan 2010 @ 11:34am

Re:
I kinda like Dana White.

But he's not a particularly savvy business man. He's just really aggressive and has a lot of perseverance. He's seems like the kind of guy that will get it wrong in the beginning and come around eventually.

I would expect him to come around on this particular subject a lot faster than any current boxing association.
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Sergio, 6 Jan 2010 @ 11:46am

It will never stop
If a company were to ever get a magical wand and use it to stop piracy, I can garantee that company would then sue every company because they are all "benefiting" from their "work."
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chris (profile), 6 Jan 2010 @ 11:47am

Perhaps it's not too surprising that such a group's only reaction is to fight
to quote eddie "scrap iron" dupris from million dollar baby:

All fighters are pig-headed some way or another: some part of them always thinks they know better than you about something. Truth is: even if they're wrong, even if that one thing is going to be the ruin of them, if you can beat that last bit out of them... they ain't fighters at all.
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Dark Helmet (profile), 6 Jan 2010 @ 12:02pm

Re: Re: Re: Rising tide ...
"But that will take decades. Meanwhile, the owners get paid."

That's the point, it WON'T take decades, it'll take maybe A decade. This, btw, is according to some fairly smart sports journalists I've come respect, chiefly Hub Arkush. FYI, offtopic, but for football fans, be prepared for the weirdest draft/free agency offseason of all time because of the fears of the lack of a collective bargaining agreement....
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The Anti-Mike (profile), 6 Jan 2010 @ 12:31pm

UFC faces a problem that every content producer faces, which is if you don't do something about piracy in it's infancy, you may not be able to handle it later.

The costs right now are higher than the losses, but at the same time, it is also keeping the piracy from becoming ingrained. They risk looking like grinches to a small number of people today, but if they only start to address the issue when it becomes 20 or 30% of the potential viewership, they will have already lost the battle.

UFC is very good about promoting their product and putting a fair amount of their stuff out there in the public (specifically on SpikeTV). In fact, Monday will be their first live fight night for free on Spike. There is pretty much something UFC related on at least a couple of times a week.
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VX, 6 Jan 2010 @ 1:08pm

Re:
Actually, since you can't stop piracy at all, your point is completely null and void. They can spend as much money as they want combating piracy and the people who can't afford their events will still download them. If there is no download then the UFC will be lucky if the individuals read a news article or try to follow up. Without access to the fight videos, live or otherwise, these fans are likely to move on to something else.

How many 16 year old UFC fans can afford a $60 PPV twice a month?
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ChurchHatesTucker (profile), 6 Jan 2010 @ 1:16pm

Re: Re: Re: Re: Rising tide ...
Meh, one or two decades, then the major city owners cash out.

Frankly I thoughtthe NFL owners had a broader vision tHan that.
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Vic B (profile), 6 Jan 2010 @ 1:19pm

I watch UFC and WEC frequently on Spike and Versus, although I would never pay more than $3-5 for pay-per-view fights so I don't mind watching these a few days/weeks later. I did realize though that about 70% of my tv watching is Spike and Versus and the 30% remaining (Networks series) I can watch "free" on the internet, so I'm paying Dish Network $50/month to watch 2 channels!
It make sense that my next step is going to cut my satellite/cable subscription. Yet, neither Spike not WEC have full fights on their websites or streaming on hulu... so what am I to do? Their lack of imagination is pushing me to torrents when I would be willing to pay a token subscription fee (how much does Dish Network and cable companies pay them?) to watch their fights on the internet.
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Dark Helmet (profile), 6 Jan 2010 @ 1:32pm

Re: Re: Re: Re: Re: Rising tide ...
"Frankly I thoughtthe NFL owners had a broader vision tHan that."

I did too! That's why this seems so strange. They reaped the rewards of parity via free agency, and now they're going to kill it. And what's wierd is that NFL owners are notoriously legacy owners, in that the franchises are not regularly bought and sold.

Hub Arkush was calling this a serious potential for football armageaddon....
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Matt (profile), 6 Jan 2010 @ 2:38pm

Re:
Again, every industry fights to increase market share at the cost of its competitors. If they stopped doing that, the shareholders wouldn't want to invest. And if the shareholders don't invest, the terrorists win.

The problem is not that the content industry keeps pushing for harder, better, faster, stronger monopolies. The content industry _should_ be pushing the envelope. The problem is that Congress has caved in and granted expansion (largely because there was never anyone of apparent significance opposed to it). Blame the stupid, ill-informed and short-sighted governments.
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The Anti-Mike (profile), 6 Jan 2010 @ 3:08pm

Re: Re:
VX, it is never a question of stopping piracy as an absolute. It's the idea of making piracy less desirable, less easy, and less accessible.

Basically, it's a risk / reward deal. If the risk of putting the material out there is higher, it is less likely to happen. As there are only a very small number of people actually streaming the material, taking them on does in fact have an effect on piracy, because it makes the pirated material less accessible.

This is especially key on live events. We aren't talking about a torrent downloaded later, but rather a live stream of an event which is very specifically a "scarce commodity". This isn't something being openly broadcast, or performed in an open public place, it is an event in a closed establishment, distributed only to paying customers.

I suspect they would have less of a problem if the event showed up a few days later as a torrent, because their remaining value is only as replay on Spike.
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ChurchHatesTucker (profile), 6 Jan 2010 @ 3:45pm

Re: Re: Re:
VX, it is never a question of stopping piracy as an absolute. It's the idea of making your product less desirable, less easy, and less accessible.

FTFY
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The Anti-Mike (profile), 6 Jan 2010 @ 4:11pm

Re: Re: Re: Re:
IWB

(it wasn't broken)
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Sam I Am, 6 Jan 2010 @ 4:16pm

Doing the right thing is not always cost effective and rarely convenient. More power to them.
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ChurchHatesTucker (profile), 6 Jan 2010 @ 4:29pm

Re: Re: Re: Re: Re:
Oh, I thought that was "It Will Be."
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Mr Big Content, 6 Jan 2010 @ 6:38pm

Perfectly Logical
Of course piracy is destroying their business. They can’t help but sue to stop the piracy. But such suits cost more than the piracy they’re trying to stop. Therefore they lose money fighting the pirates. Which the pirates were responsible for in the first place. QED.
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Anonymous Coward, 6 Jan 2010 @ 10:19pm

Re: Re:
"The problem is not that the content industry keeps pushing for harder, better, faster, stronger monopolies. The content industry _should_ be pushing the envelope. The problem is that Congress has caved in and granted expansion (largely because there was never anyone of apparent significance opposed to it). Blame the stupid, ill-informed and short-sighted governments."

I blame the government but I also blame the corporations just as well. What the industry should be doing is competing in the free market and trying to find ways to compete in the free market.

If murder was legal does that mean that these corporations should murder? Absolutely not, just because something is legal doesn't mean it's ethical. It's unethical for someone to lobby for laws that legalize murder and then to murder someone. Or perhaps a better analogy would be that it's unethical for someone to lobby for laws that require everyone to kill their first born child, regardless of whether or not the government grants such laws. and of course it's unethical for the government to grant such laws as well.

Lobbying for unethical laws itself is immoral and deserving of blame.

I have every reason to blame the corporations for lobbying for unethical laws and then exploiting those laws.
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Ima Fish (profile), 7 Jan 2010 @ 12:39pm

Re: Re:
"Again, every industry fights to increase market share at the cost of its competitors.... The problem is not that the content industry keeps pushing for harder, better, faster, stronger monopolies."

You simply do not get it. Player piano rolls were perfectly legal and did not infringe copyrights. So the music publishers went to Congress and had their monopoly extended to include player piano rolls. That's exactly what happened and it continues to be what happens.

It's fine when corporations are fighting hard amongst themselves. But when they use the government to fight, by extending their monopoly rights, it's no longer a fair fight. And its no longer a free market.
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dean collins, 12 Jan 2010 @ 10:46am

plain old theft
i have to side with the UFC here. Whilst i've never paid for a PPV i do watch the free to air events on spike.

i wouldn't mind so much but people keep posting links to stream content on my Live Chat Concepts websites eg http://www.LiveFootballChat.com (justin.tv links to live streaming of the event etc)

We pull down the links and ban the users pretty much as fast as we can but it's starting to become a real pain.

At the end of the day content viewing when you didn't pay for it is theft if the own of the content hasn't agreed to it.

Anyone who disagrees send me your address so i can come and borrow something of yours.

Cheers,
Dean
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Anonymous Coward, 13 Jan 2010 @ 3:44pm

Re: plain old theft
It's copyright infringement.
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