Fronted by Luke Thomas. Editor's Note: I strongly disagree with much of Arnold's analysis here, but I'm promoting this FanPost because the issue is worth discussing.
Think about the climate of the industry at the start of the year and what the climate looks right now, nine months after the first of the year. There are five — count them — five promotions that could go belly-up in the timespan of 18 months. Elite XC, DREAM, Pancrase, Sengoku, and Affliction. The IFL is already finished, and more layoffs in the MMA industry amongst various promotions are expected to take place shortly. These trends indicate that the bottom is about to fall out of the business and that we will be stuck in 2009 with a top-heavy industry, much in a similar vein to professional wrestling.
Things certainly don't look promising here in North America and abroad for non-Zuffa promotions. ProElite and Affliction's woes are well documented, but the industry, as a whole, isn't doing any better in Japan where the sport has enjoyed great popularity for some time. There's not much doubt that some, if not all, of the above mentioned organizations will not survive. Randy Couture's likely return to the UFC is a huge blow to Affliction and other suitors who need starpower in order to lure fans to their products. It's also a signal that only Zuffa can afford the lucrative deals that proven veterans, like Couture, demand.
What does an MMA landscape dominated by one organization mean for the sport in the future? Arnold expresses a negative outlook:
Let’s assume that the bottom does fall out for all of these promotions within the next year. Where do fighters go for work? There’s no farm system at this point (other than maybe Strikeforce). Japan’s dead as a doornail right now, so nobody can go overseas for big money. WEC is folding up their 185-pound and 205-pound divisions, which means that more fighters will be out of work. Elite XC bought out several B-level promotions and managed to lose a lot of money in the process.
Even if you are a UFC fan only, you cannot be rooting for bad business practices in MMA. What’s happening now will affect UFC long-term because sooner or later, the talent pool will dry out as less and less fighters can find work on minor shows. Once the money starts drying up, a lot of fighters are simply going to quit the business.
August served as a pretty good reminder as to what a UFC-only dominated industry looks like. For the most part, it was pretty boring. Staleness and boredom are not good long-term indicators of the health of this industry.
I would tend to agree with this assessment if MMA doesn't prove to have long-standing appeal among sports fans. While this is still an open question, I don't see any proof that MMA can't fill an important and profitable niche in the North American sports scene. I'm not all that knowledgeable in regards to Japan, but I would be surprised if MMA went the way of the dinosaur there, either. As long as MMA is popular enough for the UFC to be profitable, smaller organizations and competitors( to some extent) will continue to emerge.
Football didn't die when the NFL and AFL merged. Although NASCAR dealt a serious blow to indy-styled racing organzations when it emerged as the dominant racing division in America, other organizations remain today, and the farm systems for race drivers are probably stronger than ever. While comparisons across sports are imperfect to say the least, these examples can serve as a reality check. Top-heaviness in the sports world is really more the rule than the exception. A conglomeration of talent within one organization often leaves the public with the best possible product. It's also worth noting that different sports have to compete with each other. The UFC can't just do what they want and leave fans with an inferior product, because many of these fans will cease to be fans of MMA at all.
The key to a healthy MMA industry is an exciting, interesting product produced by promotions that understand how to achieve profitability and innovate for the future. The sad truth is that many of the current players aren't up to the task of growing the sport of MMA. In the future, promotions other than the Zuffa owned businesses will likely put together successful frameworks. In the interim, I wouldn't get too depressed about what catastrophies may lie ahead for an MMA world dominated by the UFC.