Last month, Joe Lauzon engaged the reddit community regarding an article the Boston Herald published on a reported email "signed by UFC CEO Fertitta and the organization’s president, White." He scolded those reporting it as actual journalism, saying nothing was confirmed, and sounding generally hopeful about the deal. While he was right about it not being confirmed, it seemed that the hopefulness may have been short lived, for the rest of us anyway.
BE Analytics: Breaking down the Reebok money
Paul Gift crunches the numbers for the new Reebok sponsorship tiers to show fighters and fight fans what the UFC world may look like.
The Boston Herald article numbers that leaked last month were roughly double what is now being reported, and while the original numbers seemed a bit high, the new ones are not doing any of us any favors. I’m not outraged to the point of throwing my Reeboks in the garbage (although maybe I should?), but as a frame of reference, the sponsors on the crotch of my last fight paid $5,000 (thanks 411-PAIN!). Beyond that single sponsor, the remaining companies on my shorts and banner paid over $10,000 to be there. $2,500 for my next bout is an enormous pay cut.
There are worse positions to be in than the 1-5 fight range though, as $5,000 total for someone with nearly 10 UFC fights is pretty brutal. Remember that time a car dealership gave Bigfoot a Maserati after he knocked out Overeem? Yeah, no more of that.
Many folks are speculating that this surely sweetens the deal for fighters to compete in Bellator or WSOF to avoid big bad Uncle Dana and Lorenzo, and all their rules. I don’t know that the sponsor market over there is such that it’s healthy enough to become much of a factor, although that could change, with companies shut out of the UFC looking elsewhere to spend their money now. As it currently stands, I think most fighters stand to make more money under Zuffa than anywhere else, sponsors or no sponsors.
Still, the UFC has certainly introduced another cost of fighting in the Octagon, one higher even than the original sponsor tax, and there’s no way that doesn’t change the landscape of professional MMA competition. The cost falls on more than just the fighters, as the managers seem to be getting a huge shaft here. A squad of fighters in the UFC and a Rolodex full of sponsor contacts just got a whole lot less valuable, and the relationships between managers and retail/gear companies may suffer accordingly.
We are still left with questions after Wednesday’s announcement. How will merchandising work? In an ideal world it works in three simple steps.
1. Athlete works with Reebok representative on brand specifications that best represents athlete and resonates with fans.
2. Athlete directs fans to website link, where Reebok handles exact designs, production, printing, sales, and shipping.
3. Athlete gets mailed royalty check quarterly, or yearly. This is the way it works with our Topps cards, minus the first step.
Much of the outrage, it seems, lies in the big question, which is where the hell is the rest of the money? As our own Paul Gift pointed out, there’s a large disparity between the projected dollars spent per year and the numbers seen here. There are a few things to gather, I think. It’s likely that Reebok is factoring in their dollars spent on Connor, VanZant, a short lived Jones, Pettis, etc. as part of that $11.67 million per year that we were told would be dedicated to athletes every year.
It’s also possible that the structure allows for more money to be spent each year, until the later years offset the gaping hole of missing money in the early years. It’s likely that all dollars paid out of promised merchandising deals for the future is included in that $70 million price tag that Reebok paid for all of this. We were told that every cent of that $70 million would be spent on us, and it’s still a possibility.
I get the whole not looking like a Nascar race thing, and I like it. I get incentivizing more fights to change your pay structure. Want more cash? Get your Donald Cerrone on. I get a lot of the things that they are trying to do here, and most of it I can support, but that may be only because I'm not sure what other option there is besides standing behind it and hoping for the best.
I'd be lying if I said this one doesn’t sting a bit.