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The real cultural and business significance of UFC winning the war in the Trump era

By Zach Arnold | August 18, 2020

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2016 was the year that UFC triangulated and gambled big time on saving their business model by publicly supporting Donald Trump.

Barring a Joe Biden victory in 2020, the Ali Act will not be amended any time soon to give fighters a private right of action to sue in a US Federal Court.

2020 became the year that UFC assumed the mantle as the American cultural, business, and political leader of Donald Trump’s public policy response to the Coronavirus.

Most sport entities are flat-lining while UFC’s bottom line is soaring. It’s rise, despite explosive debt-financing, is as impressive as Netflix and Amazon.

For a majority of press writers who cover UFC’s business, this development raises a lot of uncomfortable truths.

They won the war on the Ali Act

Dana White took an enormous business risk when he so vociferously endorsed Donald Trump in Cleveland at the 2016 GOP convention. Personal favor or not, White backing Trump put UFC in the crosshairs. Either Trump won and legislation to amend the Federal Ali Act to cover Mixed Martial Arts would be stymied or UFC would find itself in political and prosecutorial crosshairs over its size and scope of business practices.

Trump won bigly. UFC won bigly. They’re not only managed to avoid amendment of the Ali Act, the organization has taken incredible advantage of technology to lay the groundwork for sidestepping the Ali Act altogether in the future. The company has successfully conditioned its fans to buy PPV events from venues they control. Las Vegas no longer holds dominion over the company.

The fewer amount of American shows for UFC, the greater the chances are for UFC relocating its core domestic business in order to center contract forum in a foreign destination. The process is happening faster than you realize. The virus gave them an opening to exploit and they will likely take full advantage of it.

They won the war over arbitration and liability

The United States Congress has still not passed a law to provide Coronavirus liability business protection. Lawsuits are hitting the courts (see: Briggs & Stratton).

In its rush to be the first active American sports entity to return to business, UFC could have easily obfuscated responsibility by hiding behind various state athletic commissions. It would have opened the door to various legal challenges by public interest law firms. Athletic Commissions would have been forced to participate in court fights.

Instead, UFC presented a take-it-or-leave-it scenario to fighters, media, and staff attending events: sign a coronavirus waiver that (originally) featured a gag order, liquidated damages, and forced arbitration.

Key word: arbitration.

Arbitration allowed UFC to disable anti-SLAPP procedural legal protections for fighters by eliminating state and Federal courts from the bargaining process.

UFC has not been criticized by any fighter over its handling of infectious disease protocols since the implementation of the waivers.

Once individuals are conditioned to accept arbitration as standing operating procedure, it will be of no surprise to see an attempt to implement arbitration as a forum in future standard UFC fighter contracts.

They’re winning the culture war in sports and entertainment

NBA ratings are tanking. Major League Baseball is struggling. MLS, which has handled its virus protocols very successfully, finds itself struggling as well.

UFC and the PGA, conversely, are experiencing massive business growth.

The easy, safe answer is to point out that these are not team-sports, therefore fans are already conditioned to accept them as great gambling sports in a time where team operations are held in funky “bubble” atmospheres that feels more or less like watching a scrimmage.

The more challenging answer is that UFC and PGA are “Trump sports” and we’re in an American election cycle unlike anything the world has ever seen.

The correct, depressing answer is that the gamble by American political and business activists to “marry” sports and sports branding to politicians and political parties has exacerbated an outright culture war in America.

Republicans have been losing the American culture war since 1988. They really started losing the culture war after California Governor Pete Wilson got kicked out of office.

The Republican Party has no control over Hollywood, the American school system, Silicon Valley, most of corporate America, and a heavy majority of big US cities, state and Federal government agencies.

The gamble to utilize this favorable terrain into “marrying” sports brands with politics seemed rather pedestrian.

Trump has changed everything. His existence alone has given the other half of America the green light to respond. US conservatives don’t do boycotts — they do buycotts. UFC has been the biggest beneficiary of this buycott. The other major US sports properties that embraced a political message that is the antithesis of Trump are taking a hit.

A hallmark of Donald Trump’s business and political career is using allies to conduct A/B testing. In the sports business, his two major allies are Dana White and Vince McMahon. They are the tip of the spear in Trump’s culture war. The political messaging from UFC versus the political messaging from WWE could not be more different in 2020. The result of this real-time A/B testing? UFC 252 drew as many searches on Google (over 2 million) as WWE drew Smackdown viewers on Fox broadcast.

Acknowledging this result requires admission of some rather uncomfortable truths.

UFC’s rise reveals a terrible impending schism for future sports start-ups

The marriage between uber-liberal, pro-Chinese Disney and Trump-affiliated UFC is the picture perfect symbol of American sports dysfunction. Bob Iger and Dana White.

Under normal conditions, high-profile American business liberals didn’t mind doing business with conservatives as long as it benefited their bottom line. Then they would turn around with money from the rubes and cycle it to Democratic causes.

In 2020, this arrangement satisfies no one because everyone’s sensibilities are offended.

A growing number of American business executives have no tolerance or patience to deal with American conservatives. You’re not going to walk in the door of a Fortune 500 company as an unabashed Trumpist. Forget it. CEOs, COOs, Human Resources, advertising agencies, and white-shoe legal firms simply are refusing to engage in doing business with people they perceive to be against their core political values.

Conversely, sports brands pushing the politics that these executives support are tanking. The erosion is real.

How does UFC benefit from this chaos? They got their foot in the door before it was slammed shut.

Disney needed UFC desperately to build up their ESPN+ platform. Their executives are eating the proverbial turd sandwich while allowing their inner id, their inner personal core to run rampant on ESPN TV & radio air waves. UFC got in the door just in time and is raising all sorts of hell.

This development is warming up red alarms across corporate America. HBO, (Time) WarnerMedia, Fox, NBC. You name it, the chaos is omnipresent with dramatically shrinking advertising revenues and polarized viewership thanks to branding specific political messages/messengers to sports properties.

Disney married the devil. That doesn’t mean other US CEOs will do the same. The outright hostility is growing towards US conservatives who happen to represent quite a large share of the Americans sports landscape.

This presents a major problem for entrepreneurs.

The financiers who can help fund and build new sports start-ups in the US are largely of one political persuasion. The customers needed to build those brands happen to be of another political persuasion. Something has to give. Many of the new leaders in US Corporate Culture no longer see themselves as simply transactional money-changers — they see themselves as change agents of society. They’re willing to risk money on the table (as long as it’s not their own) if it means repelling customers who aren’t members of the same political army.

What this means is that obtaining mid-to-large scale funding of a new sports venture in America has gotten a whole lot more complicated. It’s a new, giant barrier of entry. It applies to all US sports business, especially combat sports.

It’s music to UFC’s ears.

Topics: Media, MMA, UFC, Zach Arnold | 1 Comment » | Permalink | Trackback |

One Response to “The real cultural and business significance of UFC winning the war in the Trump era”

  1. […] numerous UFC properties, may have taken a gamble on Trump in 2016—a move many interpreted as I’ll-scratch-my-back-if-you-scratch-mine pragmatism. However, there’s a fundamental difference between currying favor for the sake of favorable […]

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