The announcement on Friday that Gilbert Melendez had agreed to terms to a multi-fight and multi-year deal with Bellator could mark the first time in four years that UFC would have lost a genuine top title contender to an outside promotion when their contract expired.
But even if it doesn't work out that way, it is a signal of a significant change in the business of mixed martial arts, in particular, leverage for the top fighters from all organizations when their contracts come due.
The deal has put the UFC in a position, for the first time in several years, to have to use the matching terms clause in their contract. While Bellator CEO Bjorn Rebney wasn't clear on the exact date, the time frame for UFC to agree to match the offer or Melendez will be able to execute the new deal is a relatively short window, believed to expire sometime in March.
Matching terms can be far trickier than it sounds on the surface, given the issues between Eddie Alvarez and Bellator last year, That wound up in a court case over exactly what matching terms entailed. Eventually, an out-of-court settlement was reached which led to Alvarez back fighting for Bellator.
The last time UFC was in a situation where a legitimate top title contender left the promotion was in late 2009, when Dan Henderson, who had been in serious talks for a middleweight title shot at Anderson Silva, frustrated with how his UFC negotiations were going, signed a lucrative deal with Strikeforce. But the bargaining leverage for most top fighters disappeared when Zuffa purchased Strikeforce in early 2011.
Rebney indicated this wouldn't be the last time something like this would happen. He noted they are going to aggressively go after the best fighters when they are legally allowed to, and said they are in talks with name talent right now.
Bellator will open its weekly Friday night live card schedule on Spike TV starting on Feb. 28, run though May, do monthly shows in the summer, and have a fall season of weekly shows from September through November. Rebney noted it's going to be all out from now until he sits down to eat Thanksgiving dinner.
"We're gong to continue to sign the best fighters, whether they are from a favela in Brazil, the frozen tundra of Siberia, or they are fighting in the UFC," he said. "That's the mission. The fighters are the ones fueling pay-per-view buys or fueling cable television ratings. You're not fueling ratings by promoting Bjorn or Bellator. Promoting the fighters should be first and foremost.
"We're going after everybody, more-and-more often. I think there's a bigger picture issue. The biggest thing is there are two major players in MMA. It's far and away better for the fighters. When a fighter has one option, he has no power at the negotiating table. But when he has two options, the fighter has all the negotiating power. That's actually counter intuitive, coming from the CEO of a fight company. But that's the truth. And my checkbook may take a shot because of it. But if the fighters can earn what they feel they deserve, overall we and the sport will be in a better place. You're going to see much more of this as we move forward, guys coming from the smallest regions where we find undiscovered talent, to the superstars from the UFC and other guys we find in the United States."
The Melendez contract obviously calls for a number of fights, as well as a cut of any pay-per-view shows he's a headliner in, but also has a number of topics covered outside the cage.
"I can't be too specific," said Rebney. "But it includes on-air opportunities, entertainment opportunities behind-the-scenes, some marketing opportunities, really, the whole genesis is Gil-specific. The key to the deal is building the Gilbert Melendez brand, not the Bellator brand or the Bjorn Rebney brand. The fighter's brand is what's important. The focus was on talking to Gil and his team. How do we leverage all the different resources to build the `El Nino' brand, and that's what got us all on the same side of the table to put this structure together."
Melendez (22-3), was the No. 2 contender in UFC's lightweight division, behind champion Anthony Pettis and former champion Benson Henderson. With Josh Thomson's loss to Henderson on Jan. 26 in Chicago, and Henderson having two losses to Pettis, it put Melendez at the front of the line for a title shot. But that shot would be delayed if a Pettis vs. UFC featherweight champion Jose Aldo superfight was to be made this summer.
If UFC declines to match, Bellator will then schedule Melendez's first match.
"You can start with (Eddie) Alvarez (Bellator's lightweight champion, (Michael) Chandler (former champion and current top contender), (Will) Brooks, (Dave) Jansen, all those fights would be awesome," said Rebney.
Rebney used Alvarez's name constantly in the discussion of potential fights for Melendez. A few years back, when Melendez was the Strikeforce lightweight champion and Alvarez was Bellator's champion, prior to the Zuffa purchase of the Strikeforce brand, Rebney publicly tried to garner publicity for such a match. It never got past his call-out stage since then-Strikeforce CEO Scott Coker, who had a stronger brand at the time and more exposure, had no interest in such a deal. But it is notable because many have thought it was inevitable Alvarez would be headed to UFC after his next fight with Chandler.
If Melendez signs, it would be Bellator coming full circle.
"Gil was the first big name I tried to recruit in 2008," said Rebney, who at the time was looking for Hispanic fighters after he got funding to start the promotion and had cleared a time slot for 2009 on ESPN Deportes. "I jumped on the plane from Chicago to Northern California, sat down with Gil, and talked about the vision I had. It's now like it's night and day. Today, we're the second-largest MMA organization in the world, we're beating UFC ratings on cable, and then I was a guy flying Southwest with an idea and a dream. He was a great listener. He had a great vision of what he wanted to accomplish, and he was wise beyond his years, even then. You could see his skill level. Now he's gone about maximizing his opportunities. But he was the first guy I went after. A few years later, I tried hard to figure out a way to do Alvarez vs. Melendez. We've been patient and built up the foundation, we have the right partners, the best broadcasting partner in MMA history, and now we may have Alvarez vs. Melendez or Alvarez vs. Chandler."
Numbers on cable for both groups vary greatly. The biggest UFC events on its new home of Fox Sports 1 have drawn more viewers than Bellator's biggest events, even with the disadvantage of being a weaker overall station and being available in nine million fewer homes. The biggest Bellator shows of the last season did beat all but the highest UFC shows on its new home.
Ironically, when Melendez opted to stay with Strikeforce in 2008, it was Alvarez, a star in Japan who wasn't well known in the United States, who Rebney signed to be the top star of his new group. To do so, he offered Alvarez a deal for significantly more than UFC was offering at the time.
If Melendez comes to Bellator, that will not affect plans for the company's first pay-per-view, scheduled for this spring, headlined by Alvarez vs. Chandler III. Rebney said that show is locked in. A planned pay-per-view in November fell though when Tito Ortiz, one of the headliners, was injured, and the second Alvarez vs. Chandler match, originally set for that show, ended up headlining a Spike TV special.
Rebney stated Melendez wants to get started as soon as possible. If UFC doesn't match the deal, he would like to debut Melendez this spring, which with the Alvarez vs. Chandler III fight already on the books, means his first fight would be against someone else. If he should win that, his second fight could be the big one.
Should Melendez win, a fight against the Alvarez vs. Chandler winner would seem an obvious direction. With pay-per-view a facet of Melendez's contract, it could figure to be the company's second show in that arena. Rebney is already thinking of ways to promote such a fight.
"There were two fights that could have battled for fight of the year last year," he said. "Michael vs. Ed II (Nov. 2 in Long Beach, Calif.) and the other was Gil vs. Diego (Sanchez, Oct. 19 in Houston). Those were two epic fights, both in the 155-pound division."
Rebney noted it's too early to script out exactly what the direction would be, but he's salivating at the prospective opportunities.
"We'd like to get Gil busy," he said. "Gil would like to fight at the same time as Ed vs. Michael III on that pay-per-view or on a major Spike show like we did with Rampage. There are some very legitimate other options and we're looking at all of them. But for now, we have to wait out and see what UFC does."
Rebney said the negotiations for a deal began as soon as they got word from the representatives of Melendez that they were legally able to talk about a potential deal in late January.
"It really started when they reached out to us," he said. "I didn't realize the status of his deal. As soon as they reached out, we started discussions.
"We went for two-and-a-half weeks, with a lot of back-and-forth. I recognized there was a shared vision of what would be the best thing for Gil, but inside and outside the cage. After speaking with Gil at length, and hearing from him what he wanted to accomplish with his career, both short-term and long-term, we then worked with Rodolphe Beaulieu (Melendez's agent) and CAA to put together a package he was looking for. It came together pretty quickly."