Francis Ngannou is afraid of risk? Endeavor’s UFC business model eliminates risk…for them

Dana White said Francis Ngannou's PFL contract is a sign he doesn't want to take risks (the kind his UFC has been putting fighters…

By: Alex Conway | 9 months
Francis Ngannou is afraid of risk? Endeavor’s UFC business model eliminates risk…for them

Francis Ngannou signed a landmark MMA contract with PFL last week. The deal is a remarkable one, leading Bloody Elbow’s financial expert John S. Nash to wonder if the deal would benefit PFL in the long-run. UFC President Dana White has also decried the deal. White also said that the deal signified that Ngannou was a fighter who didn’t want to take risks, something White apparently finds abhorrent.

Alex Conway of the Fight Time podcast argues that, instead of talking about what kind of risks Ngannou may or may not be taking, we need to discuss the risk UFC contracts have posed to fighters for decades.

Francis Ngannou won’t take risks? What about the UFC?

This is a transcript of Alex’s Podcast Fight Time with Alex Conway used with permission.

Today’s episode, we’re going to talk about Dana White’s recent comments regarding Francis Ngannou. recording this on a Sunday, so he made these comments as opposed after the fight press conference Saturday night, May 20. After McKinsey Dern beat Angela Hill, he was asked about Francis and Ngannou and he had a lot to say surprisingly. 

I honestly didn’t think he was going to talk about it, but he had some notes ready. I’m going to talk about one thing In particular; I’m not going to break down the entire summary of what he said. But there’s something that he did say that really stood out to me and I had some thoughts about it. So here we go.

The big thing that I took away from that I wanted to counter a little bit and put my opinions out there in the world about how I felt about what Dana White said when he said Francis Ngannou doesn’t want to take risks.

Ngannou took a huge risk most fighters avoid

Here’s the thing, Ngannou took a risk that most fighters are not willing to take when he decided to fight out his contract. And in fact, I would argue that the UFC is the entity that hates risks. Here’s why they structured contracts in a way that prevents fighters from hitting the free agent markets by instituting extensions. 

Basically anytime a fighter turns on or off like I mean, I’m going to use an extreme example to make a point, but let’s say they asked you to fight. I don’t know June 27. It’s May 21. Maybe you’ve got a funeral that day. Maybe it’s your wedding day. Maybe you’re hurt. Maybe you are wanting more time to take on that opponent. Maybe you are next in line for a title shot, and they’re asking you to fight the 11th ranked guy and you’re just like, You know what, maybe I’ll set that out. 

They can extend your contract. They can extend your contract. They can extend your contract.

“They don’t want to promote in a world where there is an actual market for fighters.”

I think the latest thing I read was up to six months and they can do it every single time that you turned down a fight so you’re basically at the mercy of whatever they offer you or you will work for them in perpetuity. More about that in a minute.

The ESPN deal eliminates the risk of flop UFC pay-per-views

Here’s another way that they’ve eliminated risks. The UFC has eliminated the volatility of pay per view buy rates. I mean, they took all of the paper views that they sold over a certain amount of time and at the beginning of their deal with ESPN, they had ESPN match that average pay per view by er a and they got that as a guarantee.

Whatever money they were going to get from kind of their average pay per view by rate. ESPN basically said we’ll go ahead and give you that so that we can be the exclusive Pay Per View distributor. So the UFC has a locked in guaranteed number every time they put on a pay per view. All they have to do is hit their obligation.

I think it’s about 13 pay per views a year and they’re getting that as a guarantee and then they get everything else they still get a pay per view split with ESPN on top of that, and what this has done is allowed them to not rely as heavily on making fights that they normally pre ESPN need to make to hit certain revenue benchmarks.

They still make them if they’re easy to do, why wouldn’t you? They do like making money. But if they get any pushback from the fighters at this point, they’ll just extend their contracts when they turn down dates and names.

They’ll create interim titles. They’ll put up less than standard Fight Night main events. They don’t care because they don’t have to.

So why isn’t the UFC taking risks we want to talk about Ngannou not wanting to take risks. Why wouldn’t the UFC take risks?

Why shouldn’t they try to eliminate risk?

And why shouldn’t a fighter also try to mitigate their risks? Why is that being held against Francis Ngannou but not the UFC? So Francis is afraid of risks, then why did he negotiate $2 million guaranteed for his opponent?

That’s right. You didn’t see that? That’s a big thing that stood out to me as part of his contract with the PFL. Not only did Francis get all that stuff he was looking for, but he made sure that whoever signs up to fight him in the PFL gets a guarantee base of $2 million plus probably some paper viewpoints things like that, because Ngannou will fight exclusively on a review, that money could have been his.

I mean, I’m sure the PFL would rather not have to pay $2 million or would have gladly given most of, if not all of it to Francis Ngannou. But Francis negotiated that in hopes that it would be his golden ticket to entice some other big names probably from the UFC to fight out their contracts so that he could then fight them in the PFL. Why would he do that, if he’s so afraid of risks?

That doesn’t sound like someone afraid of a challenge. Ask yourself, why couldn’t the UFC get a Jon Jones deal done until the second they announced in Ghana who was a free agent and they’d let them go?

You know what I think? In fact, not even what I think, basically what happened: Jones got an extension and I think the UFC made it so that Jones is off the table completely for Ngannou and the UFC didn’t want to compete with another MMA promotion for the right to host that fight. And I don’t blame them.

But let’s be consistent about who is or isn’t willing to take risks. Let’s not fault anyone from exercising their leverage to mitigate risks, fighter or promotion. And let’s talk about Jon Jones for a little bit and risks and wanting certain things to do certain things. He had a contract for a number of years.

For a while, right let’s just hone in on like the 2019 2020 timeframe.

Jon Jones could have fought Ngannou in 2019 or 2020

Jones could have fought Ngannou under those terms, but he sat out, he wanted more money specifically to fight Ngannou. No shit. That’s a big risk and Ngannou is a knockout artist like no other we’ve seen in the UFC, and that would have been the biggest threat to Jones’s unblemished record.

Jones is getting older. If he lost how many more big fights and paydays you know would he have gotten beyond maybe an Ngannou rematch? He wanted to fight… make no mistake he’s not scared to fight Francis just like Francis isn’t scared to fight Jon Jones, but not at the prices and not at the risks.

Just like Francis you know Francis wanted bigger payday. The UFC didn’t want to talk to June’s or Francis about paying them what they wanted to make that fight and so that fight didn’t happen. And you’ll notice the UFC didn’t sign Jon Jones to that extension until Francis left.

Jones didn’t sign with the UFC until Francis left. Jones could have fought Francis at any time the UFC could have made that fight at any time during 2020 2021 or early 2022. Let’s come back to that just a moment later. Let’s keep going. Let’s talk about these UFC contracts and let’s talk about how that relates to risk.

Let’s not forget about the fighters’ class action lawsuit

Also, the UFC is currently getting sued over the potential legality, illegality of those UFC contracts. And because of this, the UFC instituted a sunset clause that didn’t previously exist before 2017.

Let’s talk about contracts for a little bit for those that don’t know, the gist of what a UFC contract looks like is you’d get six fights. I’m just making numbers up for a little bit. Maybe you get six fights over two years or something like that, for a certain amount of graduating money per fight, and they can offer you whatever they want, as far as who you need to fight.

And if you turned it down, for any reason, with very limited exceptions, they could keep extending the time on your contract like I talked about a little bit earlier. So two years could actually be forever until you fought all the number of fights on the deal.

So when that sunset clause came around in 2017, that was a direct response to some of the arguments the lawyers for these fighters that brought a lawsuit against the USC were making which is… we don’t think that should be allowed. That’s not a thing. That is legal.

That is not a thing that was maybe clearly stated in the contract or it wasn’t clearly made, you know, obvious whatever, however, they’re arguing it. The UFC in response to that lawsuit put a sunset clause in 2017, which means there isn’t indeed on the contract.

Maybe it’s six years, two years, but whether it’s the first thing that comes up if you fight six fights, you’re done if you do it in a year and a half, if you fought three fights, but the two years was up, you’re done after those two years. And so even if you didn’t fight all the fights, or attend any or turn any fights down, eventually the time would run out and you’d be a free agent.

This is what Ngannou utilized to become a free agent and then negotiate with other MMA promotions when he wasn’t getting the terms he wanted. With the UFC. So what did the UFC do?

UFC has closed the escape hatch Ngannou used to get free

UFC has since eliminated sunset clauses and put language into their contracts that state fighters can’t join class action lawsuits anymore, which eliminates the mechanism that fighters used to get that sunset clause in the first place, which gave them a modicum of contract negotiation leverage.

And so again, why isn’t the UFC willing to take risks? Why is it solely on Ngannou? Who and his risk management why is that? Well, why isn’t the UFC willing to allow fighters to go out on the free agent market and then say we’re the best place for you to fight and compete with other promotions?

I’m not knocking them again. Why would they allow that to happen? But you want to talk about Ngannou not wanting to take risks? I think it’s important to highlight the ways in which the UFC also doesn’t want to take risks.

The UFC controls the narrative

Because the UFC controls the narratives, because they control all the fights, they have most of the key fighters, they have these contracts that severely limit the abilities of fighters to shop their talents around other promotions. The UFC gets to call fighter scared when fighters want to exercise their right to see what’s out there from other promotions.

Let’s remember that the second the UFC knew that Ngannou was going to truly test free agency and then Ngannou didn’t say he was leaving the UFC, he just said I’m going to go look at what other promotions can offer me.

The second they knew that was a fact, the second they knew they wouldn’t be able to resign him before he got a chance to go talk to the Bella tours in the PFL and the one championships? That’s when the UFC announced he was not welcome back with them. They took themselves out of the running. Why did they do that? Because they didn’t want to be in a bidding war.

They don’t want to promote in a world where there is an actual market for fighters. 

Why Ngannou is the real risk taker

If the UFC decides they don’t want you, then who are the other promotions going to be competing against for your services? What would drive the price up if the market center is not in the running for your services?

That’s why Ngannou is a risk taker because he knew that and he still went out and gambled that he could get the things he wanted in a contract even if the UFC wasn’t going to participate in the bargaining and he mostly got them and the UFC is afraid that others might follow suit. They are going to give more heavyweights extensions in the next year.

You’re going to see big name heavyweights get locked down so that they cannot go look at that $2 million offer that PFL is putting out there that eliminates the risk to the UFC of anyone going over to the PFL and fighting Ngannou.

Working behind the scenes to make sure Ngannou has no one to fight

And so while they’re out here calling out that Ngannou doesn’t want to fight anybody, they’re behind the scenes making sure that Ngannou can’t fight anybody, they’re afraid of their people leaving them and going to fight in another organization and they shouldn’t be afraid of that.

Oh, to be honest, you know, I don’t expect the UFC to tell everyone the whole truth but we as fans do have some responsibility to respect the fighters choices. You know, maybe you don’t have to, maybe you don’t want to feel that way you can be mad.

I’m mad about no Ngannou vs Jones too

I’m mad that we probably won’t get Ngannou vs Jones, but I do think we should also recognize that there is nothing stopping the UFC from making that fight. Let me say that again. There is nothing stopping the UFC from making Jon Jones versus Francis and Gotti when you may be saying how’s that possible? Because the PFL would agree to that fight in a heartbeat.

You know, they might even be obligated to pay Jon Jones $2 million. On top of what the UFC pays Jones according to the contract they’ve been going on who negotiated with the PFL I don’t know how that would work out but that’s a strong possibility. But the UFC is not going to do it. They don’t want to risk giving away any of their leverage to any fighter or rival promotion. But we should say that out loud.

The UFC can make the fights we want to see even if a fighter isn’t under contract with them. Boxing does it all the time. And Ngannou would say yes to that Jon Jones fight PFL would say yes to that Jon Jones fight. I bet if the only thing stopping Jon Jones from getting to fight Francis and Ngannou was the UFC needing to co-promote with the PFL, Jones would say yes to that fight. The only group an entity that would say no is the same one saying that someone else doesn’t want to take a risk and that is the UFC. Alright, that’s it for this episode. Until next time, stay safe out there.

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Alex Conway
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