Is EliteXC On Life Support?

ProElite(EliteXC's parent company) stock price is hovering at $2.75 a share. They have cancelled future shows, and gotten rid of most of the people that were responsible for the hint of notoriety they achieved. They have lost over 30 million dollars within the last year, not years...but last YEAR. Make no mistake about it, losing that type of money in such a short time span can cripple virtually anything. Think about this for a second, the UFC lost 44 million from 2001-2004. At this pace, ProElite will surpass that amount by the end of this year easily.

Basically they are hinging the entire company on two people...Kimbo Slice and Gina Carano. These two fighters are the marquee names carrying the 3rd EliteXC installment on CBS in October. Even if that show is a success ratings wise, what is next after that? Their roster lacks star power, plus they lack the funds to attract star power in the form of accomplished fighters.

The MMA business is driven by PPV buys, and the UFC has that niche on LOCK. Around 75% of their total revenue comes from that one source. EliteXC at their apex(right after their CBS debut) still would have done poorly PPV wise in my opinion. Because the lack of a deep roster of fighters does not allow them to offer PPV on a consistent basis to be successful.

I think EliteXC will complete their 4 fight deal with CBS and basically disappear, with a small number of credible fighters jumping ship to the UFC. I can see the next show featuring Kimbo and Carano being successful, but I doubt it will achieve the same level of success as the initial foray on CBS. It will probably give EliteXC just enough leverage to do the last show in the agreement. Then shortly after that the plug will be pulled. The following statement is ProElite's CEO Chuck Champion speaking to mmajunkie:

We look at October as a critical step in our development," ProElite CEO Chuck Champion told MMAjunkie.com (www.mmajunkie.com). "We’re approaching it that way. We’re not betting the ranch on the thing, so I don’t want you to think we’re just pushing ‘all in,’ using another analogy. But, with each one of these … if you do them well, they create momentum, and if you don’t do them well, they stall momentum. A young company needs a lot of momentum."

I call bullshit, everything is riding on this next show otherwise they wouldn't be canceling these other shows in an attempt to save money(to possibly put toward promotion for this show on CBS). He's right though, a young company does need a lot of momentum. Something ProElite has none of right about now.