Debets: How the Ali Act Could Reshape MMA in 2018
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* * *
The United States Congress’ Subcommittee on Digital Commerce and Consumer Protection held a hearing on mixed martial arts just two short months ago. Therein, former two-division Ultimate Fighting Championship titleholder and UFC hall of famer Randy Couture joined Oklahoma Rep. Markwayne Mullin to make the case for extending the economic protections that cover boxers to their counterparts in MMA.
If introduced, H.R. 44, better known as the Ali Expansion Act,
would decouple promotions like the UFC and Bellator
MMA from their titles and rankings system, placing those
responsibilities within the domain of independent sanctioning
bodies licensed by state athletic commissions. Champions would be
required to fight the No. 1 contender of their division at least
once annually, and firewalls would be erected to prevent promoters
from also acting as managers.
Other features of the bill would require MMA promotions to disclose dealings with fighters and other stakeholders, as well as the revenue generated, in connection with the events on which they compete. In the words of Pennsylvania Athletic Commission Executive Director Greg Sirb, who also testified at the hearing, these provisions would inform fighters of the “size of the [financial] pie” so they know “how big a piece” of it they should ask for at the negotiating table.
So how did we get here? To answer that question, it’s instructive to look to the Mixed Martial Arts Fighters Associations and work backwards.
The MMAFA was launched in 2006 by Arizona attorney Rob Maysey and purports to represent all MMA fighters and trainers while maximizing their influence and earning capacity. Since 2008, Maysey and an increasingly high profile group of active and retired fighters have argued that the best way to do this is by bringing MMA and other combat sports within the orbit of regulations that apply to boxing -- a fight they took to the nation’s capitol in 2016.
Mullins, a former mixed martial artist who was almost a participant on Season 6 of “The Ultimate Fighter” reality series, agreed to introduce the legislation in Congress in early 2016. Since then, several members of the MMAFA, including Couture, Wanderlei Silva, Ken Shamrock and Jon Fitch, have travelled to Washington, D.C., seven times and lobbied hundreds of congressman over the issue, successfully persuading 32 Republicans and 26 Democrats to throw their support behind the bill.
For members of the MMAFA and their newfound political allies, the Ali Act represents an opportunity to address many of the problematic features of the MMA industry, all of which can be attributed in some way to the lack of external regulation over the sport and the resulting concentration of power in promotions. Unlike the other fighters associations (the Professional Fighters Association and the Mixed Martial Arts Athletes Association), which have flirted with collective bargaining as a solution to fighter mistreatment and low pay, the Ali Act route places faith in a competitive market and a separation of powers as a means of improving their conditions.
The logic behind this requires a broad lens, but starts with the fact that unlike almost every other professional sport, including pre-Ali Act boxing, MMA promotions retain control over both the rankings system and their championships. Whereas football has the NFL commissioner and boxing has sanctioning bodies like the World Boxing Council, MMA has UFC President Dana White calling the shots on matchmaking, suspensions, rankings and championship fights without any real institutional accountability.
This power dynamic and the league model popularized by the UFC means that fighters must sign long-term contracts as a precondition to fighting for that promotion’s title, with no guarantee they won’t be passed over for more marketable contenders. Of course, this wouldn’t necessarily be a problem if there were a number of different MMA promotions with equally prestigious championships -- something equivalent to the various teams bidding on free agents in the NBA, NFL or MLB. However, as Zuffa -- the UFC’s former parent company -- progressively bought out competitor organizations Pride Fighting Championships, World Extreme Cagefighting and Strikeforce, among others, fighters’ signing options dwindled. In White’s words in 2010, “there is no competition” in MMA; the UFC is the “only guy.”
The lack of competition -- we’ll get to Bellator’s upswing in a minute -- works to force many fighters to accept terms well below their market value. It’s also been an important factor in how the UFC has co-opted them into its many other business ventures, gradually chipping away at their economic freedoms and insulating their market share from future competitors. Perhaps the best example of this can be seen in the ancillary rights clause the UFC began inserting into its contract in 2008, which allows the promotion to exploit fighters’ likeness in perpetuity -- in the UFC video game, for example -- without any entitlement to additional compensation. Fighters that resisted were threatened with walking papers, and when that didn’t work, reprisals were directed at their teammates and management.
Combine these scorched-earth tactics with the fact that the UFC owns almost every fight in the sport’s history, and promotions wishing to compete with the company face an incredibly steep uphill battle. With limited fight footage to use in promotional materials and significant parts of the fan base that still use the terms “MMA” and “UFC” interchangeably, even Bellator -- a promotion backed by a media conglomerate worth over $20 billion -- has likely yet to turn a significant profit despite signing a string of high-profile fighters in the last three years.
That’s how we get to the Ali Act, which would theoretically address these power imbalances that mediate the UFC’s relationship with its fighters and with that of its competitors. By removing control over rank and title to an independent sanctioning body, the UFC would be less able to use them as bargaining chips in negotiations; meanwhile, financial transparency requirements would give athletes more leverage in contract renewals and end the UFC’s predatory bonus system. Prohibitions on coercive contracts, such as those that last more than 12 months and require fighters to sign lengthy options clauses as a prerequisite to fighting for a title, would also nullify the dreaded championship clause in UFC contracts, allowing champions and top contenders to entertain offers from multiple organizations to promote their fights.
In short, the Ali Act would open up both sides of the market, upend the UFC’s manifestly unfair revenue sharing model and give fighters the agency more characteristic of independent contractors. It could change the game forever. Given the possibility that the legislation passes in 2018, it’s about time we started talking about what that means.
Jacob Debets is a recent law graduate who lives in Melbourne, Australia. He has been an MMA fan for more than a decade and trains in muay Thai and boxing at DMDs MMA in Brunswick. His work has been published widely, including on Fight News Australia, LawinSports, LowKickMMA, MMASucka De Minimis and Farrago. He is currently writing a book analyzing the economics and politics of the MMA Industry. You can view more of his writing at jacobdebets.com.
The United States Congress’ Subcommittee on Digital Commerce and Consumer Protection held a hearing on mixed martial arts just two short months ago. Therein, former two-division Ultimate Fighting Championship titleholder and UFC hall of famer Randy Couture joined Oklahoma Rep. Markwayne Mullin to make the case for extending the economic protections that cover boxers to their counterparts in MMA.
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Other features of the bill would require MMA promotions to disclose dealings with fighters and other stakeholders, as well as the revenue generated, in connection with the events on which they compete. In the words of Pennsylvania Athletic Commission Executive Director Greg Sirb, who also testified at the hearing, these provisions would inform fighters of the “size of the [financial] pie” so they know “how big a piece” of it they should ask for at the negotiating table.
On the other end of the witness table was Marc Ratner, the UFC’s
senior vice president of regulatory affairs.
In between being roasted by Mullins, Ratner defended the
current state of MMA regulation, asserting the UFC treats its
athletes “fairly by any objective measure” and that the conflicts
and corruption of boxing that necessitated legislative intervention
there aren’t found in MMA.
Ratner’s testimony complemented the considerable sums of money the
UFC has paid lobbyists to oppose the bill; although with 58
congressmen sponsoring the legislation so far, that battle may be
over, at least until it reaches the Senate or President Trump’s
desk.
So how did we get here? To answer that question, it’s instructive to look to the Mixed Martial Arts Fighters Associations and work backwards.
The MMAFA was launched in 2006 by Arizona attorney Rob Maysey and purports to represent all MMA fighters and trainers while maximizing their influence and earning capacity. Since 2008, Maysey and an increasingly high profile group of active and retired fighters have argued that the best way to do this is by bringing MMA and other combat sports within the orbit of regulations that apply to boxing -- a fight they took to the nation’s capitol in 2016.
Mullins, a former mixed martial artist who was almost a participant on Season 6 of “The Ultimate Fighter” reality series, agreed to introduce the legislation in Congress in early 2016. Since then, several members of the MMAFA, including Couture, Wanderlei Silva, Ken Shamrock and Jon Fitch, have travelled to Washington, D.C., seven times and lobbied hundreds of congressman over the issue, successfully persuading 32 Republicans and 26 Democrats to throw their support behind the bill.
For members of the MMAFA and their newfound political allies, the Ali Act represents an opportunity to address many of the problematic features of the MMA industry, all of which can be attributed in some way to the lack of external regulation over the sport and the resulting concentration of power in promotions. Unlike the other fighters associations (the Professional Fighters Association and the Mixed Martial Arts Athletes Association), which have flirted with collective bargaining as a solution to fighter mistreatment and low pay, the Ali Act route places faith in a competitive market and a separation of powers as a means of improving their conditions.
The logic behind this requires a broad lens, but starts with the fact that unlike almost every other professional sport, including pre-Ali Act boxing, MMA promotions retain control over both the rankings system and their championships. Whereas football has the NFL commissioner and boxing has sanctioning bodies like the World Boxing Council, MMA has UFC President Dana White calling the shots on matchmaking, suspensions, rankings and championship fights without any real institutional accountability.
This power dynamic and the league model popularized by the UFC means that fighters must sign long-term contracts as a precondition to fighting for that promotion’s title, with no guarantee they won’t be passed over for more marketable contenders. Of course, this wouldn’t necessarily be a problem if there were a number of different MMA promotions with equally prestigious championships -- something equivalent to the various teams bidding on free agents in the NBA, NFL or MLB. However, as Zuffa -- the UFC’s former parent company -- progressively bought out competitor organizations Pride Fighting Championships, World Extreme Cagefighting and Strikeforce, among others, fighters’ signing options dwindled. In White’s words in 2010, “there is no competition” in MMA; the UFC is the “only guy.”
The lack of competition -- we’ll get to Bellator’s upswing in a minute -- works to force many fighters to accept terms well below their market value. It’s also been an important factor in how the UFC has co-opted them into its many other business ventures, gradually chipping away at their economic freedoms and insulating their market share from future competitors. Perhaps the best example of this can be seen in the ancillary rights clause the UFC began inserting into its contract in 2008, which allows the promotion to exploit fighters’ likeness in perpetuity -- in the UFC video game, for example -- without any entitlement to additional compensation. Fighters that resisted were threatened with walking papers, and when that didn’t work, reprisals were directed at their teammates and management.
Combine these scorched-earth tactics with the fact that the UFC owns almost every fight in the sport’s history, and promotions wishing to compete with the company face an incredibly steep uphill battle. With limited fight footage to use in promotional materials and significant parts of the fan base that still use the terms “MMA” and “UFC” interchangeably, even Bellator -- a promotion backed by a media conglomerate worth over $20 billion -- has likely yet to turn a significant profit despite signing a string of high-profile fighters in the last three years.
That’s how we get to the Ali Act, which would theoretically address these power imbalances that mediate the UFC’s relationship with its fighters and with that of its competitors. By removing control over rank and title to an independent sanctioning body, the UFC would be less able to use them as bargaining chips in negotiations; meanwhile, financial transparency requirements would give athletes more leverage in contract renewals and end the UFC’s predatory bonus system. Prohibitions on coercive contracts, such as those that last more than 12 months and require fighters to sign lengthy options clauses as a prerequisite to fighting for a title, would also nullify the dreaded championship clause in UFC contracts, allowing champions and top contenders to entertain offers from multiple organizations to promote their fights.
In short, the Ali Act would open up both sides of the market, upend the UFC’s manifestly unfair revenue sharing model and give fighters the agency more characteristic of independent contractors. It could change the game forever. Given the possibility that the legislation passes in 2018, it’s about time we started talking about what that means.
Jacob Debets is a recent law graduate who lives in Melbourne, Australia. He has been an MMA fan for more than a decade and trains in muay Thai and boxing at DMDs MMA in Brunswick. His work has been published widely, including on Fight News Australia, LawinSports, LowKickMMA, MMASucka De Minimis and Farrago. He is currently writing a book analyzing the economics and politics of the MMA Industry. You can view more of his writing at jacobdebets.com.
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