In U.F.C., Retirement Threats Are the Fighters’ New Leverage

In U.F.C., Retirement Threats Are the Fighters’ New Leverage

In U.F.C., Retirement Threats Are the Fighters’ New Leverage

In U.F.C., Retirement Threats Are the Fighters’ New Leverage

After dominating the light-heavyweight division for 10 years, Jon Jones is moving up to heavyweight. That is, if he doesn’t retire from the Ultimate Fighting Championship first.

Jones tweeted last week that he had had a positive conversation with the U.F.C. about negotiating to move up from the 205-pound division to heavyweight, where fighters can weigh as much as 265 pounds. But his optimism came only hours after he said he had vacated his light-heavyweight belt and would be enjoying the U.F.C. as a fan because there had been “no negotiating” about his salary.

It has been that kind of summer for the U.F.C., where in addition to figuring out how to stage events in the middle of the coronavirus pandemic, two of its biggest stars retired and two others openly considered it.

Henry Cejudo, who held belts in both the flyweight and bantamweight divisions, retired in May but seemingly left the door open to return if he were paid more, saying the U.F.C. president, Dana White, “knows the number.” The U.F.C.’s best-known fighter, Conor McGregor, retired in June, for at least the third time. Jorge Masvidal also threatened to retire, before accepting a fight on a week’s notice at U.F.C. 251 in July.

Perhaps all four fighters started thinking seriously about retirement at the same time. More likely, however, is that they all recognized the power of retirement as a negotiating tactic. Because of the long, exclusive, ironclad contracts fighters must sign with the U.F.C., threatening retirement is one of the few leverage points star fighters have.

“The U.F.C.’s business model, the genius of it, is that in combat sports you are made by who you beat,” said John Nash, who has covered the business of mixed martial arts for almost a decade. “The only way you can become a made guy is beating guys who are already in long-term contracts in the U.F.C., and the only way you get to fight them is to sign a long-term contract.”

The U.F.C. did not make an executive available for an interview, and representatives for the fighters did not respond to a request for comment.

While these are not the first U.F.C. fighters to threaten retirement in the middle of negotiating a contract, the sheer volume suggests something has changed. The U.F.C. makes a lot more money than it did several years ago, especially after securing a big new television agreement with ESPN in 2018, and is now owned by a much larger corporate entity, Endeavor.

Fighters are newly aware that they are collectively paid only less than 20 percent of the U.F.C.’s revenue — compared with the roughly 50 percent athletes receive in the biggest team sports — because of documents released last year in a long-running antitrust lawsuit that could upend the U.F.C.’s business model.

“If I’m bringing in XYZ dollars, giving me 18 percent of those dollars that I bring in, it’s not fair, man,” Masvidal said on “SportsCenter” in June, directly connecting the revenue-sharing level to Jones and Cejudo.

“So what they tell you to, at a certain point in your career — like they told Jon Jones and Henry — is, retire. If you want more money and you’re not getting it. Well, we’re not going to let you go, so what you’ve got to do, retire.”

Historically, the U.F.C.’s revenue has largely been tied to pay-per-view success. A few big pay-per-view fights could lead to record revenue, giving the fighters some measure of negotiating power if they were names fans would pay to watch. The U.F.C. needed them. But in 2019, ESPN became the exclusive distributor of U.F.C. pay-per-view fights domestically, paying a set amount annually and gaining much of the upside from big events.

The U.F.C. is now incentivized to deliver a number of events each year, prizing a large roster of fighters, and is less incentivized to give a fighter a big raise to ensure a popular pay-per-view draw.

Most U.F.C. contracts have a number of clauses that give the U.F.C. tremendous power over their fighters. They have tolling provisions, which pause the contract if the fighter is injured or otherwise does not fight, meaning fighters cannot refuse fights and wait for their contracts to run out. There is also the championship clause, which automatically extends the contract if a fighter becomes a U.F.C. champion.

The iron grip the U.F.C. has on its fighters fueled its growth, and in many ways makes it friendlier to spectators than boxing. Fighters don’t spend years taking cupcake fights to pad their records, and top fighters don’t spend years avoiding the mega-bouts fans desperately want to see, like Manny Pacquiao and Floyd Mayweather Jr. did. There is no alphabet soup of confusing sanctioning organizations.

The differences look a lot less rosy to the fighters, however. The boxer Saúl Álvarez, known by his nickname Canelo, signed an 11-fight deal that pays him over $30 million per fight, much more than any U.F.C. star. McGregor’s biggest payday came when he boxed Mayweather in an exhibition, not from any of his U.F.C. title fights. And when Jones agitated for more money to move up to heavyweight earlier this year, White, the U.F.C. president, used a shorthand to describe how outlandish he found Jones’s request.

“He told my lawyer he wants what Deontay Wilder was paid,” White told MMA Junkie, referencing the reported $30 million Wilder was paid to fight Tyson Fury in February.

When Jones defeated Dominick Reyes in February, the 11th time he successfully defended the light-heavyweight belt, his purse was just $500,000, though it is not known if he received a percentage of the pay-per-view money or other bonuses. Jones tops the U.F.C.’s own pound-for-pound rankings; why shouldn’t his earnings approach Wilder’s?

Many of the rights boxers enjoy are enshrined by the federal Ali Act. Its provisions include a ban on coercive contracts, and it mandates that promoters disclose how much money they make from fights. But the law does not apply to mixed martial arts, and a bill to extend it to all combat sports has stalled in Congress for four years.

The U.F.C. builds up stars quickly. Just 14 months ago, Masvidal was hardly a household name. It took just one spectacular knockout in five seconds, and a victory over the fan favorite Nate Diaz in front of President Trump, to transform him into the type of athlete whose antics and utterances are regularly featured on “SportsCenter.”

It knocks them down quickly, too. After a decisive loss to Kamaru Usman in July, it isn’t clear whether Masvidal can quickly challenge for a belt again. Ronda Rousey was one of the most famous athletes on the planet when she took her first two losses in 2015 and 2016, and then decided she had better career prospects in professional wrestling and in Hollywood.

The best chance for fighters to gain negotiating leverage to carve out longer and more lucrative careers is most likely a lawsuit that was filed against the U.F.C.’s parent company in 2014. The lawsuit accuses the company of having both an illegal monopoly and monopsony power, which is when a buyer of services — in this case, a buyer of mixed martial arts fighting services — faces little competition. While other mixed martial arts organizations exist, like Bellator, the U.F.C. has most of the world’s top fighters.

The federal judge overseeing the case is expected to rule soon on whether to grant it class-action status, which would make around 1,200 fighters claimants against the U.F.C. If granted, the fighters could win billions of dollars, as well as structural remedies like a ban on long-term contracts.

That would most likely tamp down the retirement talk within the sport.

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