The mixed martial arts (MMA) world is abuzz with the fallout of today’s (Wed., May 6, 2015) unveiling of the new official Reebok UFC sponsorship payouts, and the response hasn’t been all that encouraging at first.
Many lower-tiered fighters (and some upper-tiered ones) expressed major concerns at the endorsement figures, which figured to be quite low based on the previous income they were pulling in finding their own sponsors. UFC CEO and co-owner Lorenzo Fertitta took part in a conference call to address the issues with the Reebok deal, noting that it’s built for the future of both the UFC and its athletes:
“We believe that the introduction of this outfitting policy is very beneficial for the athletes,” Fertitta said. “It’s an investment that we’re making as a company, and we think it’s going create long-term value for the athletes, the UFC brand and for the sport.
Fertitta remarked that the deal will also take away any likelihood of a fighter not being paid by a sponsor, an unfortunately all-too-common occurrence in the sport of MMA:
“This athlete outfitting policy is going to create guaranteed income, thus eliminating the burden of acquiring sponsors.”
And while the reported $70 million dollar deal was supposed to re-distribute the wealth among the fighters, some thought that it wasn’t adding up. Fertitta reassured them that the only money left over would be used to keep the uniform program running:
“The only revenue that is coming through from Reebok that is not included to be distributed to the fighters will be used to cover direct operating costs for this program.”
But even if that is the case, the numbers just seem to be a paltry sum by comparison. Fertitta tried to put out those flames temporarily by stating that the announced numbers were just minimums, and that there could be extra money to be had in the future (if the program is deemed successful):
“These are minimums. We’re always going to continue to review this. Obviously we’re making a bet that this is going to be a successful retail launch, and we’re hopeful that there is going to be additional revenue associated with that, but what we’re able to guarantee at this point is based on the guarantee payments that will be given and flowed through to the fighters.”
Fertitta also explained the thought process that brought the entire pay schedule about, noting that he and his team spent a lot of time sorting out the finished product. In addition to that, he said many of the details of the agreement arose from discussions with the athletes, who are excited to embark on the groundbreaking new venture:
“How we came up with them is a lot of pain-staking hours in a conference room going through the options with our analyst team and trying to figure out the best way to distribute the money,” Fertitta said.
“A lot of the provisions in the policy are as a result of discussions we had with athletes. I’m sure there will be those that aren’t excited about the policy, but I can tell you that the vast majority of athletes that we’ve spoken to are excited about the opportunity. They are excited about getting equipment designed specifically for the sport that they get to keep, they are excited about the uniforms and they are excited about the possibility of selling merchandise with their name on it.”
Many if not most fighters, however, may argue that Fertitta’s time spent figuring out the deal was time wasted, as it seems several are set to lose an absolutely massive amount of sponsorship money basically overnight. Ultimately Fertitta knew that this would happen, and he believes the UFC could only do their best in duplicating how the athletes have been compensated in the past:
“Certainly we knew going into this thing that we’re not going to make everybody happy, that’s an impossibility. What we tried to do was get as much intelligence as we possibly could by talking to managers and fighters managers over about an 18-month period and literally creating an entire database of where we felt the market was for fighters who were at different tiers, and we felt like we did a pretty good job of replicating the compensation that they were getting.”
So the UFC has spoken up about their controversial new deal with Reebok. Are you buying what they’re selling?
Photo Credit: Jayne Kamin-Oncea-USA TODAY Sports