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The Ronda Rousey effect: How high will the price tag be for ESPN to snatch UFC from Fox Sports?

Nobody is better in combat sports at generating social media traffic than the UFC & Ronda Rousey. It may not always be the nicest or most pleasant of comments from a rabid 18-to-34 year old demographic, but it’s voluminous.

ESPN decided long ago that they were interested in promoting UFC as much as Fox Sports… and it’s Fox who has the $90 million a year TV contract with Zuffa.

There has been financial pressure exerted on ESPN management by Disney regarding the salaries of on-air personalities. The network has gone all-in with expenditures for live programming. Costs are exploding. The mentality of promoting the brand over the talent won in the end, as Colin Cowherd & Keith Olbermann were shown the door.

There’s a reason ESPN immediately embraced a reported pay-for-play contract with Al Haymon’s PBC. ESPN no longer needed to spend $50,000 here and $50,000 there for filler boxing programming. Haymon paying them was music to the Mouse’s ears. However, automatic loyalty to promoting boxing is not a guaranteed proposition with ESPN. The network has gone all-in with Ronda Rousey. They put up with her PR blitz against Floyd Mayweather and gave her an award over Serena Williams. In Disney-land, Rousey’s a hotter property than Serena is right now.

Combine UFC’s ability to dominate social media traffic with ESPN’s hunger to bring UFC aboard in the future and you end up with the kind of positive coverage we have witnessed on ESPN’s platforms for UFC content in 2015.

When UFC’s contract with Fox expires in a couple of years, ESPN will undoubtedly make an offer to steal UFC away from Fox Sports 1. Whether ESPN will pay $90 million a year to UFC is one question, but it’s entirely another question to ask whether or not UFC sees an opportunity to offer programming for both networks. Will Fox drive a hard bargain at the negotiating table and demand exclusive TV rights or will UFC be able to shop around different programming packages similar to what NASCAR has done in the past?

ESPN never promotes a sports property they don’t have a piece of… except for UFC. Ask the NHL. Ask NASCAR. Ask EPL.

It is clear that Disney wants a piece of the action with UFC and they most certainly want a piece of the action with Ronda Rousey. She appeals to all demographics and hits the marketing sweet spot. Plus, she’s not losing a fight any time soon given the (lack of) depth in the 135 pound division. There is some staying power here.

Listen to how Bob Ryan & Michael Wilbon, two of ESPN’s venerable sports-writing voices, described Ronda Rousey’s place in the general American sports landscape:

“WILBON: Rousey is now 12-0 but more importantly the dominant figure in combat sports today, UFC or traditional boxing. People are comparing her recent fights to those of a young Mike Tyson. I never watch MMA but I’ve paid to watch Rousey and I find her irresistible. No matter what you think of UFC, Bobby, how important in the landscape of sports right now is Ronda Rousey?

RYAN: The big question is, what took her so long? I mean, 34 seconds? She’s had three, 104 seconds, last three bouts. She has become THE touchstone figure in all of sports. She’s what’s everyone is talking about. The other jocks are talking about her. LeBron James is tweeting about her. I even referenced her at the Martha’s Vineyard book festival on Saturday. You can’t ignore her!”

It was interesting to watch the mainstream personalities on ESPN react to Saturday’s fight as opposed to some of the more hardcore reaction, such as Chael Sonnen’s disappointment in the way things turned out with the late time start and the lack of opponent depth. ESPN personalities acknowledged the horrible mistake UFC made with 7 fights on the PPV main card and the late start time, but Rousey’s quick & explosive finish all but sugarcoated the proceedings.

The question UFC has to ask itself is a challenging one: how high is the ceiling for Fox Sports 1 and is it higher than what the ceiling could be for UFC on ESPN?

Right now, UFC has the best of both worlds — they have Fox’s money and exposure with ESPN’s powerhouse marketing apparatus. At some point, ESPN is going to want more than they’re currently getting in return. Is there enough room financially on both sides of the aisle to make a new marriage work? As long as Ronda Rousey is relevant, UFC has options with ESPN. The advertisers can’t enough of her.

Congrats on another big win, @RondaRousey. Can't wait to introduce people to your sweet side in 30 days.

— Carl's Jr. (@CarlsJr) August 2, 2015

Ronda’s won every business battle in 2015 but still has some unfinished business with former manager Darin Harvey. A final determination regarding their arbitration proceedings in Los Angeles Superior Court is scheduled for mid-January.

Trump card: In scorching critics, UFC management burns Gannett/USA Today & stokes Reebok dumpster fire

When you’re running the Rolls Royce of MMA operations but your behavior is as goofy as the XFL, it’s easy to see why you get called too cheap and too petty when you disown the people who helped make your company what it is today.

The UFC/Reebok six year, $70 million deal was a clunker in principle and has produced predictably disastrous results in execution. In and of itself, UFC making independent contractors wear uniforms while killing off their sponsorship money was ludicrous, greedy, and unnecessary — especially during a time when the company is dealing with an anti-trust lawsuit.

In the process, Reebok has drawn unprecedented level of scorn from fight fans for decisions that UFC management has made before and after the Reebok deal. The wrath of anger has been directed towards the wrong entity. However, Reebok is the sitting duck because they’re the business partner that decided to work with UFC. After the firing of Stitch Duran over his comments about cut men losing sponsorship revenue due to the Reebok uniforms. Reebok found itself on the defensive:

UFC fans: We have no input on decisions of UFC employment or fighter compensation. Our focus is providing the best gear for fighters & fans.

— Reebok (@Reebok) July 22, 2015

The anger online has been palpable – canceling Fight Pass subscriptions, threatening to boycott lower-level UFC PPVs, and direct fire aimed right at UFC’s designated lightning rod Dana White.

When you have a raging dumpster fire burning out of control. you don’t pour more lighter fluid on the dumpster fire. However, this is the only way Dana White knows how to conduct & defend business decisions in public.

Dana’s response to the Reebok & Stitch Duran criticism has been typically childish. USA Today, a content partner with MMA Junkie, took notice of Dana’s online behavior.

Furious, White trashed his own business partner and outed their relationship:

— NavyekMMA (@NavyekMMA) July 24, 2015

“u know its a bad news day when USA Today does a story about my Twitter. About time they covered us without being paid @USATODAY”

It’s one thing to pick a fight with a fan online. It’s another thing to pick a fight with a major corporation and leave Reebok & Gannett to fend for themselves based on anger produced by your own bad behavior. The newspaper industry may be having a rough time financially but Gannett doesn’t need the UFC. UFC needs Gannett. There are reasons UFC is supposedly paying Gannett for coverage.

Ascribing motives to the behavior of UFC management about the way they treat their business partners is a dangerous idea. I can’t say with certainty what they are thinking in Vegas. Perhaps this was a warning shot from UFC against MMA Junkie/USA Today to try to cower them into silence with an unspoken threat of less money or future scoops. Perhaps it was simply a childish message board-style troll-job hit for a cheap score.

In responding to their critics, the Ringmaster wants you to follow his attack lead and go after his targets for deflection. It would be easy to trash media entities or writers allegedly accepting payoffs for media coverage. For nearly 20 years, I’ve been giving opinions and advice to anyone in public and in private about what the combat sports media landscape really looks like and where the money is or isn’t.

By the same token, it takes two to tango on a pay-to-play scheme. What does it say about UFC that they, in their own words, need to pay off media outlets in order to get mainstream sports coverage? What does that say about the health of their industry as a mainstream sport when UFC has to grease the palms of major media outlets in exchange for coverage?

Dana White isn’t the majority owner of UFC. The Fertitta family owns the majority of UFC. Dana’s destructive behavior is nothing new but the stakes have never been higher. I would assume that if the Fertittas told Dana to shut up, he would shut up. So far, he isn’t shutting up. It’s only getting worse. Reebok has gotten torched for their relationship with UFC. UFC is now torching one of their biggest media partners in Gannett. What kind of message is this sending to potential business partners who might want to work with UFC?

UFC’s pound-the-table moment scape-goating Stitch Duran over Reebok backlash

Let this sink in for a moment. UFC signed a $70 million dollar deal with Reebok over six years in which Reebok controls what fighters & staff wear at UFC events. Which means UFC killed sponsorships for individuals classified as independent contractors. Which plays right into the current anti-trust lawsuit right now in Las Vegas Federal court.

Throw in the supposed fact that cut-men working for UFC can’t work for other MMA promoters and you may as well scream “restraint of trade!” on the mountain tops.

You might as well also scream “retaliation!” after UFC fired veteran cut-man Jacob “Stitch” Duran for recent comments he made regarding how much income he is losing because of the Reebok uniform deal with UFC. First it was Burt Watson and now it’s Stitch Duran. In a classic Vince McMahon-style move, UFC fired someone they considered on the low end of their totem pole in order to scare the daylights out of agents & fighters.

Amazing watching every UFC fighter managed and associated with Ali Abdelaziz dropping pro-Reebok takes in succession.

— papadopoulos (@pdlmma) July 22, 2015

What’s amazing to watch unfold with UFC right now is how the Reebok deal has managed to not only buttress the legal arguments made in the anti-trust lawsuit but also provide Bellator with an opportunity to attract free agents by allowing fighters and staff to hire their own sponsors like an independent contractor should be able to in the first place.

What’s even more amazing is this: UFC is going to the mattresses over $11.7 million dollars a year and we don’t even know what the breakdown is regarding cash versus gear/merchandise from Reebok.

  • From the outside-looking-in, does this sound like a company that can entice grade A blue-chip athletic prospects from other sports to professionally fight full-time without significant sponsorship cash?
  • Given their current behavior, does this sound like a company with great growth potential?
  • Does this sound like a company where management is so paranoid about being penny-wise that they’re being pound-foolish?

Stitch Duran wasn’t just a cut-man. He was a cog in the machine that oversaw fighter safety in the same way Burt Watson made sure the fighters were taken care of. UFC is so scared of criticism, mild or manic, about their $11.7 million dollar yearly deal with Reebok that they’re firing people who helped make the organization what it is today. They are so thin-skinned, so paranoid, and stuck in an internal bubble to understand what kind of messages they are sending to those in the business world who could be future business partners.

After the public relations hell Reebok has gone through, why would you want the headaches of being a business partner with the UFC if that coveted 18-to-34-year old demographic is ready to savage your brand on social media?

$ matters. My long-term bearish argument against Dana/Lorenzo UFC ownership is they would be too cheap & petty and lose top prospects/staff.

— FightOpinion (@FightOpinion) July 22, 2015

What’s going to damage UFC’s ability to grow long-term isn’t one firing or one scandal. It’s going to be a slow stunting of growth by a thousand paper cuts. A myriad of self-inflicted & impulsive wounds. This is a company that can help create mainstream stars like Ronda Rousey and Conor McGregor when they want to. They just want total control in the process. They can’t help themselves make more money because they’re too proud to give up any sort of control of the market they dominate. They’re happy to cash in but not risk any control in exchange for the possibility of greater rewards.

The smaller the concession or slight, the angrier management reacts. Small-time carny logic from a sports property with high visibility. They hate the Camel’s nose in the Vegas desert circus tent. UFC is its own worst enemy.

UFC & Frank Mir have everything to gain in the 2015 Fedor sweepstakes

You can’t trump star power in combat sports, even with ugly Reebok uniforms.

Ronda Rousey was making waves at the ESPY awards in Los Angeles with another remark about Floyd Mayweather. Her troll game is supercharged. Fedor was making names because he’s coming out of retirement. The Russians want his next fight. Nobuyuki Sakakibara and those desperate to stay relevant in Japan would be interested in Fedor’s services.

However, the real money for Fedor is in UFC. He knows it. UFC knows it. They may have struck out on Fedor/Brock Lesnar and Lesnar/Mir bouts… but Fedor vs. Frank Mir is still a real possibility and would be a fight that makes sense for all parties involved.

First, keeping Fedor away from the Japanese would be a good thing. Who’s he going to fight in Japan this time around? Satoshi Ishii’s star is dead. Kazuyuki Fujita?

Second, keep Fedor away from Viacom. Fedor vs. Kimbo Slice is the fight they would want to promote and it would sell on PPV. The casual American fight fan would want to watch it. It would give Bellator a big image boost if they could pull off signing that fight.

Third, UFC needs some exciting fights for the Heavyweight division. Todd Duffee got hammered by Frank Mir in San Diego on Wednesday night. Nobody is sure how many fights are left for Cain Velasquez. Fabricio Werdum is the Heavyweight champion. If Fedor could find a way to beat Frank Mir, you could immediately book Fedor vs. Werdum in a revenge match.

The dawn of a new era in California

While Nevada is busy holding workshops to hash out the new rules & regulations on beefing up their drug suspension policies, California is ramping up the penalties. Assembly Bill 469, which would jack up monetary penalties up to 40% purse fine for a positive drug test, is in Appropriations. It’s only a matter of time before it gets passed.

Which means that minimum suspensions of at least two years for fighters who test positive is here to stay. Physiques and fight performances for some veteran fighters will undoubtedly be altered. The question is whether or not the new drug testing policies will impact UFC the same way MLB’s clamp down attempts on steroids has impacted their sport in the last few years.

The San Diego card was B-level, at best, on paper but turned out to be a wildly violent affair. Jessica Andrade. Tony Ferguson. Frank Mir. My goodness.

A part of me felt bad watching Josh Thomson struggle in what may be his last UFC fight. He’s 1-3 in his last 4 UFC fights and has lost 5 out of his last 7. The scorecard loss to Ben Henderson in January of 2014 derailed his career. It’s cute for Dana White to yell at fighters to not leave it in the hands of the judges but you can’t control what you can’t control when you’re in a three or five round fight. One bad decision by a judge can cost a fighter millions of dollars.

Speaking of judges, referee/judge Mike Beltran had a curious night in San Diego. Holly Holm had a one-sided fight and won every round but Beltran gave a round to her opponent. In the Ferguson/Thomson fight, neither Beltran nor judge Derek Cleary gave Ferguson a 10-8 round despite Andy Foster pushing for more 10-8 rounds.

Was Conor McGregor’s win at UFC 189 worth $45 million dollars?

The Hulk Hogan effect.

Every WWE wrestler in the 80s wanted to be on the Hulk Hogan A-level cards when the promotion toured on split squads. When Hogan drew money, everyone else drew money. The same principle applies to Conor McGregor.

Like I said before, UFC, MMA biz, everyone involved in this industry is 100% in on a McGregor win. Losing not an option. $45M riding on this

— MMA Supremacy (@MMASupremacy) July 12, 2015

His win over Chad Mendes on Saturday night was a triumph in the UFC’s undying belief that McGregor will be their number one ace as a drawing attraction. With Jon Jones constantly in trouble, the company needed someone reliable who could become The Next Great White Hope.

The Reebok uniforms are part of UFC’s growing dumpster fire when it comes to labor relations. The uniforms are trash. But as long as UFC can continue to produce the Conor McGregors of the world, there will be a thousand fighters who will buy into whatever UFC management is selling for a miniscule paycheck in hopes of winning an imaginary lottery ticket.

The main card for UFC 189 turned out to be a fantastic watch, especially in contrast to the amusing garbage produced by ESPN with their Al Haymon PBC debut on the Mouse. When UFC is hot, it is hot. When it’s not, it’s an abomination.

I do not doubt the marketing talent & fighting ability of Conor McGregor. You shouldn’t either after his fight performance against a disappointing Chad Mendes. However, that doesn’t excuse the absolutely shallow & pathetic behavior on display by UFC management in regards to the way they have insulted the intelligence of the fans and slimed other fighters who have given their best to Zuffa.

On Friday, UFC threw a curve into the mix with a “confrontation” backstage between McGregor and Urijah Faber. A classic pro-wrestling tease. In the two weeks before Mendes/McGregor, UFC management spent every waking breath tarnishing and denigrating Jose Aldo as a man and as a fighter. A man who was touted as the Number One Pound-For-Pound fighter in the world found his credibility and reputation getting trashed as if he was Ariana Grande. Those ribs really weren’t hurt. He didn’t want to fight because he couldn’t make weight. He didn’t want to fight because he is scared of McGregor.

These attacks didn’t come from McGregor’s camp. Well, technically, they did come from McGregor’s camp because UFC management is his camp given the reports of the mansion treatment. UFC management doesn’t even blur the lines of impartiality any more. They have completely erased those lines. No wonder Al Haymon loves his boxers screaming “Call Al Haymon!” after every fight like Keith Thurman did on Saturday night in Tampa.

To top off the absurdity, UFC pulled a WCW-style skit where McGregor arrived to the MGM Grand Garden Arena with a police escort for his own protection… except nobody was actually around mobbing him. And then there was Sinead O’Connor.

Mendes is all class in defeat. He's no dummy, he knows he's in Zuffa's good book forever now. Shoutouts to this muscly man.

— Jordan Breen (@jordanbreen) July 12, 2015

For his efforts, Chad Mendes will forever be a UFC company man after his recent 8-fight contract deal and loss to Conor McGregor. At least until they cut him or decide that he’s a “coward” for not taking any fight they throw at him. Life is just a work and everything is professional wrestling.

UFC 189 Main card results from the MGM Grand Garden Arena

  • Featherweights: Conor McGregor defeated Chad Mendes in R2 in 4′57 by TKO.
  • UFC Welterweight title match: Robbie Lawler pounded Rory MacDonald and won by TKO in the first minute of R5.
  • Jeremy Stephens defeated Dennis Bermudez in R3 in 32 seconds by TKO.
  • Welterweights: Gunnar Nelson defeated Brandon Thatch in R1 in 2′54 by submission (choke sleeper).
  • Bantamweights: Thomas Almeida defeated Brad Pickett in R2 in 29 seconds by KO (knee).
  • Welterweights: Matt Brown defeated Tim Means in R1 in 4′44 by submission (guillotine choke).

Reebok is the burning tire in UFC’s growing dumpster fire

Good news for UFC — California state Senator Leland Yee copped a plea deal with the Feds in his racketeering & extortion case, so the prospects of UFC management or Andy Foster of the California State Athletic Commission possibly having to hit the witness stand dropped. We’ll see if the wiretap evidence is kept under seal or not by the Federal judge in the case.

And that’s about it for the good news lately for UFC. Really. UFC’s reverse-Midas touch these last several months is more or less standard operating procedure.

YAY! In honor of today's UFC Kit unveiling, we've got 20% anything in our store with promo code: GIBLERT

— E. Casey Leydon (@ekc) July 1, 2015

Where to begin? UFC calling Reebok fighter uniforms “fight kits.” A $70 million deal with Reebok that has been lampooned with zeal by everyone. How much of it is product and how much is actually cash? UFC is now starting their USADA drug testing program. They’ve banned fighters from using IVs after weigh-ins due to the serious problem of weight cutting.

And they got their ass kicked again in trying to get legislation passed for MMA in New York. It’s one thing to buy off Sacramento. It’s another to buy off Albany. As soon as the clock ran out in Albany, UFC was seething with outrage on Twitter about “corruption.” Yes, the folks in Las Vegas are seething with rage about corruption.

Under normal circumstances, the Reebok deal would be the most embarrassing notch on UFC’s 2015 business campaign. As Zane Simon appropriately noted, UFC’s Reebok rollout says a lot about both companies in the global marketplace. This is what you get when you want full control and envision a sport where every fighter’s image by Corporate is scripted as a generic puppet that is largely over-tanned, ripped, and covered in tattoos. Where guys are labeled independent contractors but are restrained from obtaining sponsors due to “Fight Kits.” Where fighters can’t afford to pay for month-long training camps in locations like Mexico City. Where fighters are trashed with glee by management not just on their way out but when they’re on top.

Rampage Jackson long ago joked that Las Vegas thinks they can put a bunch of guys in a cage labeled “UFC” and that it will sell. We’re about to find out now with those dreadful “UFC fight kits” just how much having UFC uniforms sells shows and sells uniforms.

We’ll find out shortly when Chad Mendes, filling in for Jose Aldo, fights Conor McGregor on short notice. UFC set up Aldo to get trashed by McGregor on a pathetic “world tour” public relations pit stop. A guy who has been champion for years was treated as the ultimate jabroni. UFC managed to string the fans along as much as possible before pulling the plug on Aldo’s title fight because of a rib injury. And now Aldo is being portrayed as the coward, the guy who’s afraid of UFC’s mini-version of Seth Rollins. Except, as far as I know, Seth Rollins or Roman Reigns didn’t actually live at one of Vince McMahon’s properties while getting the push of a lifetime.

It must be nice to be the #UFC press office and know there are people out there who will write down literally anything you try to sell them

— Jonathan Snowden (@JESnowden) July 1, 2015

Right out of the UFC playbook, we have Mendes vs. McGregor for yet another UFC “interim” title. How many more interim title belts can you have? I suppose we’ll see what the value of marketing an interim title belt is if the DA in Albuquerque is able to string a court case together against Jon Jones.

If McGregor beats Mendes, he’ll do so on short-notice. If Mendes beats McGregor, the UFC’s multi-year investment will be flushed down the toilet in exchange for a rematch between Aldo & Mendes that I’m not sure the mainstream casual fan will care about.

The UFC wants you to respect them as some sort of major sports conglomerate but they want you to scrutinize them as if they were a proverbial mom & pop shop.

It’s the fight business. When it rains, it pours. The problem is that so much of the crap UFC is facing has been entirely created by their own doing. They may not pay a price right now but they will pay a price later for mismanagement. UFC is not going away any time soon. Whether or not UFC is sold in the future, that’s a different question to ponder for another time.

The real concern MMA fans should have right now is not whether the sport has “peaked” or what the growth potential looks like. The real concern is whether or not the money that currently exists is going to exist in 10 years. PRIDE was able to bring in the best talent in the world because they had a massive contract with Fuji TV. Once the Fuji TV money was pulled due to the yakuza scandal, the jig was up. UFC faces a situation where they need to figure out how to maintain their current revenue streams to a point where they keep the status quo. Growth prospects look limited in a best-case scenario.

It’s all about the future. Fighting for UFC can bring you some fame. It can bring you some money. But for most fighters, it won’t. Most fighters will continue to have to work day jobs. The money for sponsorships isn’t going to be there in the foreseeable future. Fighter pay remains anemic. The prospects of intrusive drug testing make a “UFC lifestyle” less desirable. Money is the mother’s milk of politics and the fight business. Floyd Mayweather is making $220 million a fight and has the Showtime media platform to boost his earnings prospects. Where is that platform for UFC fighters?

If the UFC wants to remain relevant, they’re going to have to be able to attract athletic talent away from other sports. No matter how UFC spins it, their economic model & management structure is their own worst enemy. Reebok discovered the hard way that associating yourself with UFC can bring tremendous public relations heartburn to your own brand.

The proposed legal argument against California’s 3-year drug suspension of Alexander Shlemenko

  • California State Athletic Commission leveled four separate charges against Alexander Shlemenko, including a violation of a drug test (50-to-1 testosterone-to-epitestosterone ratio) and not properly/accurately filling out paperwork at Bellator event in Fresno
  • Each charge against Shlemenko carried a 9 month suspension and $2,500 fine
  • The commission hammered Shlemenko with a combined 3 year suspension and $10,000
  • Shlemenko’s attorney, Howard Jacobs, did not focus on the science but rather the process and precisely interrogated witnesses
  • California State Athletic Commission admitted that they do not do split drug testing samples (A & B samples) any longer due to inconvenience
  • Jacobs challenged both the State and the doctor heading UCLA’s drug lab as to why the State does not collect A & B samples now despite a contract between UCLA & CSAC allegedly stating that A & B samples should be collected according to Federal guidelines
  • UCLA lab head claims that since CSAC is not a WADA signatory that therefore they are not legally bound to collect A & B samples but rather can run their drug testing collection protocols as they see fit
  • An argument was made that since there is nothing in the California Code of Regulations regarding the collection of drug testing samples that therefore there are no guidelines regarding A & B samples
  • Jacobs countered that past clients he has represented in front of the Athletic Commission from 2007 to 2012 have had A & B samples taken for drug testing
  • The director general of WADA recently argued that B sample drug testing should end
  • The 7 members of the Athletic Commission board chastised Jacobs for attacking the process and for not giving Mr. Shlemenko time to answer questions and offer testimony

Starting at the 1 hour and 20 minute time mark in the embedded video, you can witness a two-hour long hearing regarding the suspension of Alexander Shlemenko.

Category: Credit

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