How Endeavor's Mark Shapiro Rewrote Sports Deals From ESPN to the UFC | The Deal

25 Apr 2024 (8 months ago)

The Endeavor and UFC Deal

Mark Shapiro, president of Endeavor and TKO, discussed the audacious deal between WWE and UFC, two of the biggest brands in sports and entertainment.
The deal involved a pitch to Vince McMahon, the involvement of the merchant bank Raine, and the presentation of the Endeavor flywheel, showcasing UFC's success and potential for growth.
Dana White, president of UFC, was supportive of the deal and recognized the potential for growth and increased monetization.
The combination of UFC and WWE presents an opportunity to serve over a billion fans globally, with potential for a one-time mega event and a joint channel.

The media landscape is disrupted, but sports content remains strong and valuable, especially live events.
Linear TV still has a significant reach and viewership, while streaming platforms require premium content for success.
ESPN+ has been a strong anchor tenant for ESPN+ due to its popularity and ability to attract subscribers.
ESPN faced challenges with declining ratings and pressure from cable providers to move to an a la carte model.
Disney invested heavily in lobbying efforts to prevent ESPN from going a la carte, fearing a significant loss in subscribers.

Mark Shapiro's career journey at ESPN is highlighted, from starting as a production assistant to eventually running the entire content division.
Mentorship and support from executives played a crucial role in his success.
A key decision in his career was choosing to lead ESPN Classic, which allowed him to showcase his storytelling and leadership skills.
At 31 years old, Shapiro was brought in to run all programming for ESPN and launched successful shows like Pardon the Interruption.
Shapiro's extensive experience in sports media rights negotiations influenced his assessment of the $1.4 billion deal as a fair and advantageous opportunity for Disney.

Bob Iger, who later became CEO of Disney, is a charismatic and inspiring leader who takes chances and surrounds himself with talented individuals.
Iger supported ESPN's move into scripted programming, such as the successful show "Playmakers," and was personally involved in the process.
True leadership involves inspiring people and fostering loyalty, rather than merely commanding obedience.

In the context of media rights for major sports, streaming services like ESPN+ will require a high subscription price to offset lost revenue from linear TV.
To justify the cost, streaming services must offer premium content that people are willing to pay for, which means cutting less popular sports and shows.
Sports with a long calendar, scheduling flexibility, and extensive library programming, such as UFC and WWE, are valuable assets for streaming services.