The UFC’s television rights deal with Fox is up in 2018 and will almost without question increase substantially. It could nearly quadruple from the $115 million per year to in excess of $400 million, according to Sports Business Journal.
The UFC also has television deals with partners around the world, which brings in additional income. This is an area the new owners, WME-IMG, are primed to exploit.
Television rights fees are a large portion of the revenue streams for other professional sports leagues, but the UFC also has a substantial income from pay-per-view sales.
WME-IMG paid $4 billion for the UFC in a deal that closed last month in part because it has a keen knowledge of the marketplace and expects rights fees to substantially increase.
The NBA’s new television deal led to a spending spree on player contracts during the free agent season this summer.
There are several powerful people who are hoping to ensure the same thing happens for UFC fighters.
The Professional Fighters Association is embarking upon a campaign to unionize the UFC’s athletes and reach a collective bargaining agreement.
Among its leaders are Jeff Borris, Lucas Middlebrook, Callie Mendenhall and Andrew Zimbalist. Borris has been one of the most prominent baseball player agents over the last 30 years, and his clients included all-time home run leader Barry Bonds, Jose Canseco and Rickey Henderson. Middlebrook has significant experience in collective bargaining negotiations and specializes in labor law.
They are persons of substance and not easily dismissed.
The PFA, though, is only one of several groups trying to unionize the fighters. The Mixed Martial Arts Fighters Association has been around several years and has the support of prominent fighters such as Jon Fitch and Cung Le, among others.
The PFA has begun approaching fighters about organizing, though only one active UFC fighter, Leslie Smith, showed up at an informational meeting Borris and Middlebrook held in Las Vegas prior to UFC 202.
The fighters, particularly on the low and low-middle end, desperately need assistance. The UFC’s pay scale begins at $10,000 to show with a bonus of $10,000 to win.
The UFC is considered the major league of MMA, and an entry-level fighter who fought, and lost, four times in a year would only earn $40,000 plus another $10,000 from Reebok ($2,500 per fight) in sponsorship money. That would be before training camp expenses, coaching expenses, management fees, travel expenses, taxes and the like.
New UFC owners Ari Emanuel and Patrick Whitesell are outspoken liberal Democrats who are used to dealing with unions in their other businesses. They’re not likely to engage in union-busting tactics.
That said, it’s far from a slam dunk UFC fighters vote to organize, because as a group, they’re situated vastly differently than players in team sports like MLB, the NFL, NBA and NHL. Those leagues have minimum salaries of $507,500 in MLB; $450,000 in the NFL; $543,471 in the NBA and $575,000 in the NHL. Those athletes have a slew of other rights, including health and life insurance.
The greatest players make the most money in each of the leagues, and the same is true in the UFC. UFC featherweight champ Conor McGregor and former women’s bantamweight champ Ronda Rousey were both on Forbes’ list of the highest paid male and female athletes, respectively.
But the great players in MLB, the NHL, NBA and NFL need the lower-level players.
As impactful as Tom Brady is, he’s not going to win a Super Bowl by himself.
But mixed martial arts is an individual sport and in a fight, McGregor relies only upon himself. So Brady’s self-interest in helping the lower-level players figures to be much greater than a UFC’s star would.
Why would McGregor, who according to Forbes was the 85th highest paid athlete in its most recent study, be willing to go on strike and lose out on his large purses to try to get new fighters he doesn’t know or doesn’t rely upon an extra $5,000 or $10,000 per fight?
He may choose to do that if he’s altruistic and wants that on his legacy, but it’s going to be difficult to sell most of the stars on the concept.
A half-century ago, baseball players were in desperate need of support. In 1966, the first year that the Major League Baseball Players Association was certified as a union, Sandy Koufax, Willie Mays and Hank Aaron made a combined $300,000.
They were three of the greatest players in baseball and all were coming off sensational years in 1965.
In 1965, Koufax pitched the Los Angeles Dodgers to the World Series championship.
He got a raise, after a very public contract negotiation along with teammate Don Drysdale, from $110,000 in 1965 to $125,000 in 1966, according to salary figures provided by BaseballReference.com.
Adjusted for inflation, Koufax’s 1966 salary would be $928,422 in 2016.
Mays earned $105,000 according to Baseball Reference in 1966 after a year in which he led the National League in multiple offensive categories, including home runs.
His 1966 salary, adjusted for inflation, would be $779,874 in 2016.
But those two future Hall of Famers were trouncing Aaron in salary. The one-time home run king earned just $70,000 in 1966, which when adjusted for inflation would be $519,916 in 2016.
In 2016 dollars, Aaron earned only $12,416 over the minimum salary in 1966 despite finishing eighth in National League MVP voting.
In 2016, the three highest paid MLB players according to Spotrac are Clayton Kershaw ($34,571,428), Zack Greinke ($34 million) and David Price ($30 million).
Adjusted backward for inflation, Kershaw would be making $4.65 million in 1966 dollars. The MLBPA’s existence has made life much better for its members.
Given the sport’s growth and visibility, fighters are beginning to see unionization as a means to improving their conditions.
“But times are changing. People are starting to be more aware that we’ve got to start making some profit out of this, not just the promoters,” new Bellator welterweight Rory MacDonald told ESPN after his departure from the UFC.
The UFC has been on a roll business-wise in the last year or so. Since May 2015, the UFC has had five of the top 10 gates in its history, and has been doing just as well in terms of pay-per-view sales.
MMA is a more star-driven sport, though, than the NFL or NBA, for example. Ticket sales and pay-per-view purchases decline precipitously without stars such as McGregor and Rousey hawking them.
Still, fighters often make far less money than it appears given the expenses they bear.
The top 25 or so UFC fighters have no issues financially, even though they are responsible for paying the same expenses. But they make far more in base pay, often earn a portion of pay-per-view revenues, get more out of the UFC’s Reebok deal and even land some non-Reebok sponsors.
The fighters see the $380 million or so that UFC president Dana White made when his share of the company was purchased by WME-IMG and they wonder why they’re not making out that well.
White devoted virtually every waking hour for more than a decade to making the UFC what it is today and spent 15 years of his life getting it to where it was worth more than $4 billion.
Le, however, recently said in an interview with FightHub TV that he believes White made more off the sale than all of the fighters in the history of the UFC have made combined.
That’s hard to prove, but it’s food for thought, and it’s another reason why more fighters are taking the thought of unionizing more seriously.
Ultimately, though, the success of the unionization efforts will be determined by the sport’s biggest stars. If they’re willing to take a stand and perhaps go on strike to fight for the common good, it has a chance.
But without them, the PFA will have to be a negotiating Houdini to get a CBA done.