Originally Posted by J.P.
So honestly, since EliteXC is a new organization struggling for recognition against a giant like the UFC, why not merge EXC and Cagerage making the fights more interesting and the depth of competition more broad.
If Pro-Elite owns both of these organizations is there a conflict of interest which is stopping them from consolidating the two companies into a more complete org?
And wouldn't this be a smarter decision competition wise?
BP already raised some good points.
By keeping the promotions separate, ProElite is able to take advantage of the knowledge and experience gained by those that built the promotions. Pro Elite doesn't have to learn how to market or build a reputation in Hawaii, because IKON and Rumble on the Rock have already done that for them.
For example, The UFC brand can't make any headway in Japan for a lot of reasons; by buying Pride, Zuffa was hoping to employ the same strategy as Pro Elite, but that company was too far gone. The expansion into Europe has required a ton of investment and is still losing money for Zuffa. At some point, it's likely to become extremely profitable, but if they had been able to work with or buy out Cage Rage, it would have saved them a lot of time and money. Their current strategy isn't necessarily wrong, though, and I'm sure they considered all their options.
Also, keeping your company divided into business units diversifies risk. If Cage Rage isn't delivering in England, you sell it off. Look at GE, they're getting out of the appliance business, but they're still making missiles, filtering the media, and airing the occasional hilarious TV show.
I think Pro Elite's strategy is the right one for MMA, but they need to start generating some solid revenue soon, because their shareholders don't seem to hold the same patience and confidence that the Fertitas had over the past decade. Come next year, there may be nothing left but Pro Elite's online social community.