If true, they are in some rough shape. I'll be honest, I've watched Bellator maybe twice at best, and I don't even think it's been that many times. I have a lot to do in my life and when I'm not working/taking care of business, I have many hobbies that take up my time. My MMA time is basically just the UFC these days, I don't watch other promotions. I'm sure there are many like that.
Yes, the UFC is successful in drying out the viewership for other promotions. You get an UFC event almost every week and including the prelims that's usually a 4-5 hour show. Then there are the post- and pre-fight shows for people interested. So people who don't have that much time available would have to chose what to watch and the UFC is just better at advertising their events with their market power alone.