Recently, UFC president Dana White stated that the UFC financial model was similar to that of MLS. This is a bare bones, no frills, side by side comparison of the UFC and MLS that revolves around the financial and revenue figures in accordance with athlete salaries. MMA Sentinel co-host, Iain Kidd aka Decado here on Bloody Elbow broke down the numbers to get to the truth of these claims.
Examining Dana White's UFC Pay Claims & MLS Comparisons
Dana White, while discussing plans to cancel bonuses in order to raise the base wage for UFC fighters, drew comparisons with the MLS.
We're more like Major League Soccer, as far as financials go," he said. "You fight three times a year, you make [$50,000 to show and $50,000 to win], you're making $300,000 a year fighting three times a year. I know you have to take jiu-jitsu and do all these other things, but we have the same thing. We don't just put on fights; we have overhead, too.
I decided to examine those claims, with a little help from Matt Roth, who was extremely useful in providing info on the MLS financial structure.
Claim One: 'We're more like Major League Soccer, as far as financials go.'
Well, compared to the NFL, that's true. Compare directly with the MLS, and some big differences become apparent. Firstly, the UFC brings in a lot more revenue than the MLS. Something like 65% more, in fact. Despite that, they pay out less to their 'players'.
Not only do the UFC pay out less in total (which would be understandable, as there are about 556 MLS players, but only about 350 UFC fighters), but they also pay out less per head. The mean average paid to MLS players is $160,136 per year. The mean average for UFC fighters is estimated at $128,456 per year, which is a figure that includes guaranteed salary, 'Of The Night' bonuses and estimated PPV cut and discretionary 'locker room' bonuses as well.
UFC Total Revenue: Approx $475m per year.
Event Based Revenue (Gate receipts + PPV income): Approx $260m per year.
Percentage of total revenue paid to fighters: 9.5%
Percentage of total event based revenue paid to fighters: 17%
MLS Total Revenue*: Approx $310m per year
Event Based Revenue (Gate receipts): Approx $157m per year
Percentage of total revenue paid to players: approx 29%
Percentage of total event based revenue paid to players: approx 56.5%
*Includes Gate Receipts, Individual team sponsorship income, league sponsorship income, merchandise sales and TV rights sales.
Claim Two: 'You fight three times a year'
This is not the experience the average UFC fighter will have. The average number of fights a UFC fighter will have per year is approximately 2. In 2012 there were 341 total fights, featuring 682 fighters. There are approximately 350 fighters on the roster. 682 spots/350 fighters = 1.94 fights per year.
Most fighters can't afford to live on two UFC fights per year. I spoke to top-10 fighter Tim Boetsch recently:
I definitely need another fight this year. I've got a family to support and bills to pay, so I can't afford not to fight again this year. I like to fight three times a year. The schedule I'm on, it looks like I'm only going to get two in this year, so, you know, we'll definitely have to stick to our budget.
Claim Three: 'You make [$50,000 to show and $50,000 to win], you're making $300,000 a year fighting three times a year.'
The truth is that very few fighters make $50k to show and $50k to win. Less than 20% of the UFC roster is on that kind of money. In 2009 the bottom 18 fighters on a card (a card on average has 22 fighters) would make an average of $20,000 in disclosed salary pay. The majority of UFC fighters make less than $20k/$20k, never mind $50k/$50k.
In short, Dana's comparisons with the MLS do not hold up very well. Despite bringing in more revenue and being more profitable than MLS, the UFC pays significantly less out to its fighters/players, even when PPV points and discretionary bonuses are estimated and accounted for.
While the MLS pays out approximately 29% of its total revenue to players, the UFC pays out only approximately 9.5% of its total revenue to fighters.
His other points are rendered somewhat moot by the fact they do not apply to the average UFC fighter, but to a very select group who manage to fight three times a year and make $50k/$50k. Less than 20% of the UFC roster falls into that category. The other 80% make significantly less and as a rule, fight less often.
As always in these analysis, sources for the information discussed are provided below.
Sources for UFC Numbers: http://www.mmasentinel.com/2013/05/ufc-revenue-fighter-expenses-study/
Source for UFC Fight Frequency: http://en.wikipedia.org/wiki/2012_in_UFC
MLS Merchandise sales estimate: http://goal.blogs.nytimes.com/2012/04/23/sporting-kansas-city-is-sitting-pretty-these-days/ $38 million based on $2m per season per club. Estimate is likely high.
Gate Receipt Estimate: Approx 6 million people in attendance (http://sports.yahoo.com/news/mls-sets-attendance-records-2012-really-great-news-154000159--mls.html )
Average Ticket Price approx $26.15 (http://www.whatyoupayforsports.com/2013/04/why-major-league-soccers-average-attendance-figures-are-misleading/ )
League Sponsorship Income: $25m per year (http://www.sportsbusinessdaily.com/Journal/Issues/2010/08/20100830/This-Weeks-News/Adidas-Ups-MLS-Bet-With-$200M-Deal.aspx )
Team Sponsorship Income: Average of available sponsorship incomes is $3.25m. Applied over entire league is $62m.(http://en.wikipedia.org/wiki/Major_League_Soccer#Profitability_and_revenues )
TV revenue: $27m per year (http://goal.blogs.nytimes.com/2012/05/26/m-l-s-salaries-a-bigger-pot-but-its-still-half-full/ )
MLS Number of players: 556. Total Guaranteed Compensation: $89,035,856 (http://www.mlsplayers.org/files/May%201,%202013%20Salary%20Information%20-%20Alphabetical.pdf)