The UFC released its response to ESPN’s feature on fighter pay. Dana White introduced ESPN’s full-length interview of Lorenzo Fertitta and called ESPN’s story “a piece of trash.”
The response video is what the UFC calls the unedited version of Fertitta’s interview which implies that ESPN edited its story to fit with what it wanted to portray. In the UFC’s response, Fertitta points out that some of the boxers featured on ESPN’s Friday Night Fights received $275 and that the UFC pays its lower tier fighters much more than that.
Seems like a good comparison but for the fact that the UFC and boxing structures are different. Also, ESPN’s role in its Friday Night Fights is not the same as the UFC’s.
Bad Left Hook sets us straight:
First of all, ESPN is not a fight promoter. This is an enormous difference. For a UFC card on FX, the UFC is pretty much in control of everything. ESPN just airs fights. They have the right to turn down a proposed fight, but that’s about it. Everything is really up to the promoters of the actual fight card.
Fertitta claims, and I’m sure he’s telling the truth, that someone fought on Friday Night Fights in a four-round bout for $275. What Fertitta doesn’t reveal — or perhaps does not actually know — is that anyone in a four-round fight that winds up on the broadcast, on TV, was positioned in a swing fight that was going to air only if there was time remaining in the two-hour time slot. There are no four-round fights purposely scheduled to air on ESPN’s series. A four-round fight is the lowest level of professional boxing, and frankly to call the majority of four-round bouts “professional boxing” is kind of a stretch; the fighters don’t often resemble what we’re used to seeing on TV, even from the middle-of-the-pack guys that get on ESPN or HBO or Showtime. It’s kind of like comparing high school football to the NFL most of the time.
Additionally, Scott Christ reiterates the sentiments I have had when the UFC-Fox deal became a reality:
UFC wants to play with the big boys in sports now. That means attention from big boy sports media, and that inevitably leads to criticism and a realistic assessment of their product and their business. The rah-rah days are dying, and it’s because of White’s ambition as much as anything else. He’s brought them here. Now they have to accept where they’re at and what comes along with that standing.
How much Zuffa revenue goes to fighters is another issue in the fighter pay debate. Dave Metzler points out that without the financial information the percentage of revenue going to fighters is a moving target:
In an attempt to use figures based on Zuffa’s percentage of an 800,000-buy show, which is the rough industry estimate on UFC 141, the $3.1 million live gate, using listed fighter pay, announced bonuses, estimates of unannounced bonuses, and percentages of pay–per-view revenue built into the main eventers’ contracts, give you a very rough figure of 28 percent going to talent. However, for the Jan. 7, Strikeforce show in Las Vegas, with a very small gate figure and a full roster of fighters to pay, that figure could easily have been in the range of 50 percent.
Metzler goes on to assert that pro wrestling, not boxing, is a closer business model to the UFC:
The closest business model to UFC is that of World Wrestling Entertainment, which is believed to pay in the range of 13-15 percent of its total revenue to its performers. While some will argue WWE is a form of performance art and not a real athletic competition – and thus the performers don’t deserve as much money – the dollars WWE derives from its performers, who take a legitimate physical pounding, is every bit as green as those which UFC makes.
Payout Perspective:
I think the UFC response (minus Dana White’s usual pleasantries to opposition) is compelling but it obviously has some flaws. From a purely PR standpoint, its a good response to the ESPN piece. What would have helped the UFC in its response is if the UFC had some up and coming fighters state how much they are paid and agree that its great. Realistically, I think the UFC could have done this because I’m sure some fighters are just glad they are getting a shot. Having Serra, Liddell and Griffin talk is fine but they are all “company men”; well-established, past champions of the UFC.
If you didn’t read Metzler or Christ’s great piece over on Bad Left Hook, most people exposed to this debate would look at the UFC response and say, “Hey, that’s true. What about boxing’s pay?” But, its hard to compare the UFC to other sports league due to the difference in business models. The fact remains that with success comes scrutiny. ESPN, like every other TV investigative show, likely had an agenda when interviewing Fertitta. That does not necessarily mean ESPN is bad or “hates the sport.” But, it means that the UFC should be aware of the issues it now faces with more exposure.
Nobody knows what the UFC’s true revenues are…
Meaning true PPV figures and true live gate revenue not counting the TRUE number of comped seats. This doesn’t factor in marketing costs that the UFC must spend on and the day-to-day staff they spend that boxing and it’s promoters do NOT pay for.
A UFC event has expenditures well above what a similar boxing event might account for in terms of staff and marketing. While boxing is forced to spend for the talent, the UFC is still attempting to solidify itself as a legitimate sport and with that comes alot of dollars that you are not privvy to looking at the boxing business model.
Just look at Gary Shaw and his attempt to grow a MMA organization using boxing’s out-dated marketing and promotional business model.
I don’t understand how some journalists are justifying the poor pay in ESPN’s boxing cards.
These people give numerous arguments as to why it not comparable to UFC.
The point is then why did the ESPN report compare UFC to the big sport leagues.
A poor pay is a poor pay, ESPN is a billion dollar enterprise, the boxing promoters make big money too, surely they could spare a few thousand for these entry level boxers.
If you think that entry level boxing cards generate no money for ESPN then why assume that entry level fighters on facebook bouts make any money for the UFC.
Boxing websites tend to get awfully touchy whenever their sport is jabbed at by MMA fans.
ESPN doesn’t put on UFC or any MMA fights, but felt the need to run an expose about UFC and it’s payscales. The fact that they don’t care about boxers making $275 on their own fights is 100% relevant to this, regardless of what red tape is in the middle between them and the fighter themselves.
I also love the complaint about “swing bouts” that aren’t supposed to air…the guys making 6k/6k are generally untelevised undercards, as well. Why is it OK for ESPN and not ok for UFC?
The entire conversation is really bizarre, too. What other sports fans are sitting there arguing over the percentage of Sports League X money that’s going to Athlete X?
I agree there is a difference with that boxer only making a couple hundred dollars on ESPN Friday Night Fights because ESPN isn’t the promoter actually paying the boxer. However like Jason Harris said above regardless of the red tape in the middle between ESPN to the promoter to the fighter it’s still looks like very poor pay for a fighter that is fighting on the largest sports network in the world.
What made the ESPN piece really bad for me was the people used in it. Everyone in the piece that spoke out against the UFC is known to have a beef or some kind of agenda against them. To me that really hurt the piece.
Also from the UFC’s side they claim that some UFC fighters were interviewed for the piece but if they didn’t have anything negative to say ESPN didn’t use any of the footage. So to me if your doing discovery and interviews for your piece and you refuse to use both sides of the argument then your clear agenda was a hit piece.
The UFC has an enormous back end, meaning production costs. More so than boxing. I would like to see a UFC fighters contract, are there any recent ones online? How much does the UFC control fighters sponsorship money? How much does the UFC advance fighters money? What is the structure for the fighters to pay the money back? What are the hidden deals that us, the fans don’t know about. What kind of confidentiality agreements do UFC fighters sign??? Is there due process and freedom of speech for UFC fighters? ha I doubt it.
Going mainstream will mean more scrutiny for the UFC. There is no way around it. And just wait until fighters start showing the effects of neurological damage – depression, Parkinson’s, suicides – it’s only going to get worse. The UFC operates in a shroud and doesn’t want anyone to know what it does, but eventually it’s all going to come out. I don’t think the ESPN piece is fair, but that’s irrelevant, other journalists are sharpening their pencils and they’ll start coming after the UFC as well. This is something Zuffa will have to learn to deal with. If enough bad press is generated it can have an impact on the bottom line.
A guy got paid <300 to fight on ESPN and I think Lorenzo's point was probably 'why not go and investigate that & stop hassling me about fighter pay.' I don't believe he was accusing ESPN of anything other then having their priorities messed up for the simple fact that MMA/UFC is news and Boxing really isn't anymore.
Some really good points from everyone so far.
I think the UFC is getting a really unfair shake on this. People who are clueless are accusing them of things even trying to use the good things they do and use them against them. People who are new to the sport wasnt around when the fighter bonus’ were added. They were included to encourage guys to end the fight to keep fights exciting. Just as they added the finish bonus on TUF. It is BS and a slap in the face that anyone would claim this as a way to control fighters. Anyone who has followed the sport long enough has seen why the bonus’ were added. Exactly what kind of control does the UFC get from giving TUF guys 5K for a finish?
As for the ESPN piece. I LMAO’ed when i saw OTL and Ricco came on. Ricco is one of the biggest jokes in MMA. He never defended his title and didnt have a ton of success in the UFC to start with. The guy has/had huge drug problems andwas on Celeb rehab for it. He is thought by many to be a huge scum bag. ESPN was really scraping the bottom of the barrel when they got him. Actually Riccos entire UFC career was during th dark ages when the UFC was only getting 20K buys. He isnt known by anyone who watches the sport today. Also his last fight was 2003. The UFC just took over a couple years before and was losing tons of money. He wa gone from the UFC 2 years before the UFC made money. How would he know anything about what the UFC pays and what share the fighters get? Not only was he long gone from the UFC but he was only in the UFC just over 2 years. What in the world made ESPN think this guy is an authority on anything UFC related? The truth is he is the only person who would talk shit about the UFC and it didnt matter how credible he was. They also never mentioned when Ricco left the UFC and that the UFC was losing money when he was getting his pay check.
This is a bit of interesting fall-out from the ESPN piece. Monte Cox had a few comments about his interview with ESPN and how it was used for that piece.
From the UG in this thread here: http://www.mixedmartialarts.com/mma.cfm?go=forum.posts&thread=1939860
“I had a 2 hour long interview with ESPN like 6 months ago… I was asked a lot of things and I responded honestly. If I’m going to comment on something, I’m going to use my name… I have never been one of those guys who want to say something but are too afraid of the consequences to have my name on it.
That being said, 95% of what I said was positive… the UFC has raised pay from 2+2 at the bottom to 6+6… and added bonuses and insurance. I’m always working to get guys in the UFC and have no issue with the pay.
I didn’t see the ESPN piece, so I don’t even know what was included, but I told them that compared to boxing, unless you are the best 2 of 3 guys in the world, UFC pays far better and works better with the athletes.
I was asked if a manager felt the pay was too low, what were his options? I said you don’t negotiate with the UFC because there are no real options if you want to make it big in MMA… the option is take what is offered or go elsewhere. The UFC doesn’t get angry if you decide to take a fighter elsewhere, they just pick another guy. There is no shortage of talent waiting for their call.
With bigger names, of course, there is more bargaining. We were taking about entry level guys when I was asked that question. ”
Then he added this later on:
“Honestly, I’m a little disappointed in ESPN. Having been a newspaper editor for 18 years, I guess I expected a little more integrity. ”
That right there closes the case for me. ESPN had a clear agenda when doing that piece.
wow… so many angles and comments to make here…
1. The ESPN boxing thing is a moot point. Lorenzo was deflecting and obviously embellishing. Saying ESPN pays the fighters is wrong, that like saying Spike or Fox is paying guys who fight on a UFC card. Second… the lowest tier of UFC obviously makes more and the UFC has done a great job to even create a min. base, but there is no boxer on a televised card that is making $275. Lorenzo much likes Dana believes he can get people to drink the Kool-aid when you say things matter-of-factly and with over zealous passion.
2. You could absolutely tell Lorenzo got pissed when the reporter quoted the “fighter X” comments on kissing their ass, fighting your butt off and hoping a bonus is thrown your way. He got extremely pissed off and denied before even letting the reporter finish. Total emotional slip. Psych 101.
3. Bonuses are indeed a carrot for fighters. I don’t know about fighter control per se… but they are definitely meant to incentivize the product. Granted not many people with get in a cage with a top athlete in the world capable of ripping your gd head off, and half ass it… but the bonuses are for one thing and one thing only… to improve the quality of the product. Much like the fake rabbit is used in dog racing, and a used car salesman getting a commission…or yes BS… even giving TUF fighters who are currently making A BIG FAT ZERO, $5k for a finish to drive them to make it happen, you’re trying to improve your outcome of the final product (i.e. quality of fights) by incentivizing the participants.
4. You have to be blind to not see that A. ESPN was obvi using people who didn’t have anything to lose by pissing off the UFC (except Monte Cox, who is a jackass and I bet will not see any of his guys booked for a while) B. NO ONE WANTED TO TALK TO ESPN in fear of retribution, hence all they had was washed up Shamrock and Ricco and C. The UFC turned around… cut the video their way… and did the same damn thing! And another thing… anybody watch the uncut version and think… hmmm… this looks like a HIDDEN CAMERA!?!?!? Was the UFC trying to trap ESPN???
5. This has to have some deep rooted seeds we don’t know about…i.e. ESPN maybe felt screwed on the FOX deal, or the UFC f’d them out of something, for them to go and start a war.
6. Granted I’m happy the UFC feels like they can create a rebuttal virally and then they are important enough for people to come find it on UFC.com and Dana’s twitter… but let’s be honest. ESPN runs an OTL on you… no less than 10 million people see it, including all of those you are trying to market to, to become new fans. You respond by posting a video like a jealous 15 year old girl who got dumped before the big dance to…. the same 75,000 views you always get??? Who wins that one.
You’d think if Dana and Lorenzo were so self aware, they’d realize you don’t go poking a sleeping bear that is ten times faster and a hundred times stronger than you. Sure you can smack around the scavenger raccoon (Spike) and it will come back and toss your garbage all over (apparently through at least 2012)… but a Bear will rip your effing head off. Quit the “little man” syndrome and learn when to STFU.
Oh and my money is on 10-15% range going to the fighters…
Think about it from a 500K buys perspective with a 50/50 split with a carrier, that is probably much higher in favor of the UFC, Bars paying thousands for a fight broadcast, plus gate revenues again shared with venue, and even shares of concessions, merch sales, and sponsorship for a given night.
That makes $3-4M in fighter costs on a $30M gross. Do the math.
I cant say i disagree with you there Moss for the most part. But this is an issue the UFC cant leave uncontested. If they let this fester who know what could happen. Atleast they got their info out to the hardcore fans and got it out on the web so anyone who tries that arguement in the future will find their side of it or maybe run into someone who will argue their side. Of Course OTL will win the battle but i think the UFC reaction my have kept it from snow balling into something great. If they dont react maybe every news outlit and TV netowrk picks up on it and gang up on the UFC who knows.
I agree that the Fighter cut is low. But i feel it is justified. The role the UFC plays for its fighters and for the sport is far greater than that a Boxing promoter. I dont think you can shell out 50/50 and still run a UFC head quarters year around, a Canadian HQ, and a UK HQ. Run events in countries and states at a loss to cultivate a following. Look at the UK events. Low prices/gate, UK events kills domestic PPV. They dont make much if anything off those events. They are still fighting to get in NY. Fighters wont foot the bill for that.
I think when the sport is fully accepted across the globe then 50/50 will be possible. But not now at such a crucial time for MMA. I think it is also important to see where MMA popularity levels off at . If the fighters agree on an amount now it will be based on a number the UFC might not ever be able to reach again. We have seen what ahppens in other sports where the players were getting to much and the owners had to fight back to be profitable. The players never want to give back when profits are down. They just take and take. 5-10 years would be a better time to look into a higher revenue share.
I looked into the close circuit PPVs for the UFC (in bars). I believe they are sell less than 2000 events in business’. I think the cost varies but possible average is about $1000 each. So that is maybe 2 million at best. We have no idea what Joe Hand Productions cut of that is. I would bet half at least. Likely more since there is more to it that what regular cable opps do. So its really not that much more money.
Clearly some people don’t really understand business.
The UFC shows labour is not just about the fighters. That is too simplistic of a view.
It is easy to count gross funds and then think I add concessions and merchandise and the tally goes higher.
There are many facets to the business beyond game night.. it is event planning.. and the UFC have a crew of unionized workers that set-up and dismantle and travel. 100’s of people that have to be lodged, paid their dues, and work overtime to install and tear down. Then because it is not a weekly event.. they have to store all this equipment somewhere then pick back up move it to the next location and following the local criteria (safety & Legislation) have to install and dismantle again.
This is not cheap and is why concert tickets are so expensive.. but a rock tour travels from night to night and is consistent.. the UFC does not have 4 shows in one week.. they have a show every couple of weeks.. with more than one team and more than one octagon.. they also have a smaller setup for TUF events.. and the FX Fight Nights.
This all costs money.. it is a huge labour expenditure especially when you have to house that many staff in temporary abodes.
This is only one small facet of the business that gets overlooked.. marketing is another. since it is global and has so many faces and languages… the 4 major leagues don’t have those expenditures.. they just sell broadcast rights.. not to mention being a large private corp with many satellite offices with more staff and all the costs involved with that taxes the profits.
See it is simplistic accountants that think they will just walk in offer more money to fighters.. make huge profits because you have better fighters.. and then miraculously they all quickly go out of business.
Affliction with Donald Trump failed.. as have so many others.
It took the UFC under the Fertitta’s half a decade to start actually making some money.. instead of losing.. and then it has taken another decade roughly for them to improve, streamline and maximize this business.
The have a perfect working model, Bellator now is the most viable competitor although Pro-Elite teaming up with Dream adds the new minnow to the fold.
Bellator is owned by Viacom.. some think wow they are owned by such a huge media giant that their success is guaranteed the fact is they are now probably in more trouble than ever. They are now responsible to the shareholders and profits are expected, they can’t afford to keep getting little to no gate.. and traveling with as a crew. They are now locked into a 3 year window once the Spike deal starts to not only get ratings.. but to generate profits from day one.
The balance sheets will be scrutinized and failure is expected unless the UFC through their Marketing to the Masses succeeds.
Spike thinks they built the UFC and believes they can replicate their success with Bellator considering how close the ties were with the UFC and their business model.
Like CBS & Showtime before them they will learn that having a minor league is never profitable to the MMA side of your business.
This business is about personalities.. big bold and beautiful.. and the elite.. everyone wants to see the best fighters fight.. of course this is US based so they only want to see the best US fighters on their TV. That is why Kimbo Slice had better ratings than Fedor.. who at the time was considered the best in the world.
If Brock Lesnar was on national tv I personally think he would’ve destroyed all numbers because he is American and is well known.. to the masses.. so again the UFC has their business model down, the others will struggle to get fans through the door.
Belllator was laying low for a few years but now they have become huge competitors.. they will not be able to compete with the UFC so their attendance will be weak.. and if they lose ratings consistently on Spike compared to the UFC numbers.. they will only last their first contract.
I think overall Bellator will fail first off because of the name, second because of the tournament format ( I love tournies but exhibition bouts..for the champs lose/lose? ), but I think they are too thick headed to change the format to tournies with the champ getting a bye in the first round. That way the champ fights often.. and you maintain a legitimate tournament.. never mind wouldn’t you like to see a championship bout every few weeks? Even if the champ fails he has some recourse.. that is genuine.. like he didn’t get a chance to prepare.. and then in the next tournie after winning his first match he could be slotted to fight the champ again. WIN/WIN
Anyways Rebney won’t figure that out and Spike will fail.. and we will be talking about Pro-Elite in two years…
This is where people fail.. the smartest and richest folk in the states continually think they are such good business men in their are that they can make a fortune.. and then fall flat on their face.
Scott Coker.. has promoted Martial Arts for two decades – FAIL
Donald Trump .. elite businessman – FAIL
Japanese Yakooza.. elite profitable Asian thieves- FAIL
Boxing Promoters in MMA- FAIL
It is not as simplistic as estimating PPV buys, Gate Receipts, and Concessions.
Many smart wealthy people have failed in chasing this holy grail, because it is not easy and there has to be some balance between pay and profits.
I heard a podcast of Luke Thomas where it was mentioned that OTL is watched by about 100,000-200,000 people.
That’s not much.
ESPN is no 1000 pound gorilla, UFC has seen worst and bested them.
A regular prime time airing of any show… OTL, PBA Bowling, or The friggen Hot Dog eating contest will automatically do a 1.5 rating… because it’s ESPN and Primetime TV…
That’s 2.5 million pairs of eyeballs for 1…just 1 airing. How many times do they replay those things? 30?
Hey ESPN, how about unionizing your workforce. I bet it will do woooonders for your sports empire, the cable providers and customers (no, let me use THE favorite pejorative of liberals here…sports CORPORATION). http://www.nypost.com/p/news/opinion/opedcolumnists/uncivil_disobedience_giA69m0VoRyvvBqnrySi5J http://www.sportsbybrooks.com/rick-reilly-espn-salary-10-million-over-5-years-14412 Now get…GET! GET I said! Go pay every single one of your employees $500/hour like the many incompetent and lazy unions workers get today.
Doc…
I was talking in mere gross revenues and the share of the pie. Because obviously the fighter pay is a hard cost and is already factored out in the EBITDA that goes into the UFC’s pocket. Yes there is hard costs operational to put this on… but the live gate itself takes care of those. Having been in live events, it probably takes every bit of $750,000 per event for the “hard costs”. That still leaves…oh… 39,250,000 or $37M net after fighters.
And really… Scott Coker failed??? If a $34M payout to go away so the UFC could liquidate your product and eliminate you from the race in two or three years is a failure… gee… I hope one day to fail like that too!
As a successful MMA promotion he did fail. If SF under his control was successful with profits and long term potential the UFC would never have been able to buy it from him and his partners. SF had a crappy tv deal that was becoming worse and worse by the day. It was great when SF was unknown and their fighters were fighting for peanuts. But as they because more popular they demanded more money yet the Showtime deal wasnt rising with the payroll increase. SF was in a dead end and i dont think they would have survived another few years without Showtime making a bigger financial commitment to their product. Seeing as how reluctant they were to renew their contract under Zuffa and to even stay in the MMA business. I doubt Showtime would have upped the pay to SF enough to handle the increased pay and bid against the UFC to keep their stars.
Currently the UFC took most of the higher paid guys out of SF and i wouldbet still lose ton of money on each event. It seems Showtime just wants MMA fights for cheap and never wanted to be competitive with the sport. They have refused to pay enough for their product to be at a high level for very long.
IMO, it comes down to what everyone expectations was and what Cokers expectations was. IF it was for Coker to make money it was successful. IF it was for SF to be a long term successful company and not a flash in the pan. Which im sure is what Coker and all the fans wanted. Then it was a failure. I dont think anyone in SF expected to be looking for the exit door 2 years and 1 month after getting a Showtime tv deal.