Taylor Sheridan's Paramount divorce puts a bullseye on UFC

Mark Shapiro got $7.7B -- and a whole lot more than he bargained for.

Is UFC’s new seven-year, $7.7B media rights deal with Paramount about to become Spike TV version 2.0?

The impending divorce between mega-Hollywood producer Taylor Sheridan (of Yellowstone and Landman fame) and Paramount is about to place a bigger spotlight on how much money David Ellison spent with Ari Emanuel & Mark Shapiro to acquire UFC media rights.

David Ellison is the son of one of the richest men in the world, Larry Ellison. Crying poverty and austerity is not typically their game. However, spending $8B to buy Paramount from Shari Redstone — thanks to help from Gerry Cardinale & Andy Gordon of Redbird Capital — suddenly changed the equation. Mr. Gordon is one busy Paramount COO, making key financial decisions and searching out for as many tax credits as possible (see: New Jersey).

Gerry Cardinale is Ari Emanuel’s financial and organizational muscle in a post-take-private Endeavor WME Group world.

It’s a great headline for Mark Shapiro to proclaim that TKO got $7.7B for seven years of UFC media rights. It allegedly bewildered many other major sports executives, who were asking: Why UFC? I bet Paramount’s future negotiations with the NFL for a new media rights extension will be one very long, fun, and extremely expensive exercise.

This is a combat sports newsletter. Why the hell should you care about what a bunch of billionaires are spending their money on?

First, the primary audience — and event promoters/sponsors — for combat sports are world governments and the billionaire class. Throw Hollywood agents and Private Equity into the mix, and every transaction involves bragging about who has the biggest stick.

Second, TKO has been able to accumulate billions of dollars without major public scrutiny. A majority of stock and debt ownership in TKO is institutional. It’s an insider’s game. This insulation has created a well-oiled machine that has isolated the likes of Mark Shapiro from any sort of financial scrutiny.

The legal scrutiny started with the $375M UFC antitrust settlement and is escalating in seriousness thanks to a recent shareholder derivative lawsuit in Delaware with veteran heavyweight activist investor Carl Icahn.

Should Mr. Icahn get access to important Endeavor documents via discovery and depositions, embarrassing details about how the TKO business works and what the billionaires behind the scenes are doing could leak publicly.

The only thing better than being rich and famous is being filthy rich and relatively unknown. No worries about public expectations then.

Which is why the recent development of an impending divorce between Hollywood producer Taylor Sheridan and Paramount is a big honking deal.

Paramount spent $7.7B for seven years of UFC media rights, but wouldn’t pay a billion dollars for one of the most successful content producers over the past decade?

Last August, David Ellison did an interview with David Faber on CNBC discussing Mr. Sheridan’s future with Paramount. Here is the money quote from that interview:

DAVID FABER: Have you spoken to Mr. Sheridan about his future plans?

DAVID ELLISON: So, I have a really good relationship with Taylor and I think he is literally a singular genius and content creator. I mean, when you look at, he literally has a perfect track record. And so, from that standpoint, I’m thrilled that we have an exclusive deal with him through 2028. And my goal is to have Taylor call Paramount his home for as long as he wants to be telling stories.

If you thought other sports bosses were privately agitated by UFC getting billions in media rights, imagine what someone as successful as Taylor Sheridan must be thinking.

He ended up getting a Dick Wolf-type production deal with NBCUniversal, which could, in a grand hypothetical scenario, result in a nearly billion-dollar payday.

Deadline: How The Battle For ‘Yellowstone’s Taylor Sheridan Was Won, And Lost

Yes, Taylor Sheridan’s divorce from Paramount isn’t until a couple of years down the road. But the tension between Paramount and Sheridan is obviously going to escalate and get ugly fast. This is Hollywood we’re talking about, after all. It is going to hover over Paramount like a dark cloud.

Which means it’s going to hover over UFC’s head like a rain cloud as well.

Larry & David Ellison paid Ari Emanuel $7.7B for seven years of UFC media rights. Yet they couldn’t pay Taylor Sheridan a billion dollars? Whose IP is more valuable in 2026?

Paramount also just acquired UFC media rights for Latin America, Brazil, and Australia. The Aussies will still have to deal with PPV, however. No Netflix marriage after all. That’s a reputational blow to the UFC.

Paramount now looks like one giant backstop for TKO.

Which means all of the focus for Paramount’s upcoming 2026 campaign of rebranding and regeneration of programming is going to be built on an expectations game of how many subscribers UFC can bring to the table and how many Paramount can actually keep.

Think the pressure is intense on WWE to deliver subscribers to Disney for ESPN Unlimited over the next six months? I’d rather be in Nick Khan’s shoes and relying on marquee events like Survivor Series, Royal Rumble, and Wrestlemania to deliver new ESPN subscribers than Mark Shapiro and Hunter Campbell worrying about bringing in millions of new subscribers to Paramount for an ice-cold UFC fight product.

UFC 322 at Madison Square Garden is currently not sold out, by the way.

The pressure is only going to increase on Mark Shapiro to deliver subscribers to David Ellison now that the public knows about the impending separation between Taylor Sheridan and Paramount.

Last week, Sportico released an interview excerpt with Mark Shapiro in which Taylor Sheridan was brought up as a topic of conversation. It’s exactly the kind of fantasizing that can get easily exposed when key people start paying attention to what is being said. That’s a bad spot for Mark Shapiro to be in.

INTERVIEWER: So, Paramount paid top dollar for UFC and WWE. My question is, can’t you call Taylor Sheridan and say, hey, I’ve got [Professional Bull Riders], can you write me in an episode? Let’s bring it all together.

MARK SHAPIRO: I’d like to go further. I want to see if Taylor Sheridan’s interested in having some equity in PBR. Investing into PBR or...

INTERVIEWER: That conversation hasn’t been had yet?

MARK SHAPIRO: Maybe we’re on the cusp of it. But Taylor Sheridan has just been, you know, the golden goose for Paramount. He’s going to do more. David Ellison values storytelling and he’s one of the best storytellers out there. So, we’d love to plug into that because he is Western lifestyle. And PBR is all about not just the bulls and the riding and the seconds and staying on or getting thrown and those again shareable moments, it’s about Western lifestyle overall.

Nice try, Mark. Now you get all the pressure to be Paramount’s primary “storyteller” with UFC fights. Tell us a story on how UFC is going to sell millions of new Paramount subscriptions and keep those new subscribers on board for more than a year or two.

Whether it’s Mark Shapiro or Donn Davis, once you start paying attention to all the various MBA buzzwords and phrases, it’s impossible not to see the lazy linguistic tricks being played.

TKO has mastered process by controlling the media, financial, and legal plumbing through their multi-monopoly. Now that they have grabbed their many billion-dollar pots at the end of this proverbial financial rainbow, they must deliver substantive results.

Is Mark Shapiro even close enough to the UFC product to have the sense to be privately worried that they can’t deliver the subscribers Paramount needs?

This is where all the gossip and maneuvering about future Disney succession comes into play. It was not a coincidence that The Wall Street Journal was the first publication to float a PR campaign to test the viability of a Mark Shapiro-taking-over-Disney campaign.

Disney is in some rough waters right now. Blake Avignon reported last week that ESPN mid-level executives Glenn Jacobs and Matt Kenny are supposedly on their way to Paramount. Deadline reported that The Big Mouse might end up with a Big Loss of $132 million dollars on the Tron: Ares movie with Jared Leto. Even worse, TV Grim Reaper on X is reporting that Disney is struggling to break out from the middle of the pack when it comes to market share in streaming platforms:

Why jump from a multi-monopoly like TKO with a $37 billion market cap to a struggling media and theme parks empire like Disney, especially given Mr. Shapiro’s business history at Six Flags?

• First, ESPN is still headquartered in Connecticut, and thus Mr. Shapiro wouldn’t have to relocate. New York is right next door.

• Second, Disney is familiar territory for Mr. Shapiro, and he may very well be convinced that he could turn things around and build a final chapter in his legacy. “The man who saved Disney.”

• Third, we don’t know what Mr. Shapiro’s long-term confidence level is for sustainable growth for UFC & WWE products. As we recently documented on The MMA Draw podcast, about two-thirds of WWE’s current audience — according to Nielsen’s Big Data + Panel ratings system — is outside of the key 18-to-49-year-old demographic.

Mark Shapiro has been very public about his value extraction techniques in 2025 in hopes of increasing EBITDA and other key financial metrics for 2026. Now that long-term media rights deals are locked in for the rest of this decade, it’s going to be tougher to expand margins without massive job cuts.

TKO is already stretched thin. AI is not going to replace human capital for day-of event labor, let alone matchmaking or television scripting.

This is exactly why the impending departure of Taylor Sheridan from Paramount puts UFC in the hot seat to deliver millions of new subscribers. The expectations game has just significantly escalated.

Is this a challenge that Mark Shapiro is ready to embrace and increase his risk tolerance for in order to grow the TKO empire when everyone else is shrinking in combat sports?

Forget brand ambassador Dana White or office fixer Hunter Campbell. All the pressure for UFC’s 2026 Paramount campaign is on Mark Shapiro’s shoulders. He loves patting himself on the back on the sports business seminar circuit.

Is Mr. Shapiro willing to put his money where his mouth is or is he looking for future instructions to exit stage left before the spotlight on the stage gets too bright?

Zach Arnold is the lead opinion writer for The MMA Draw Newsletter on Substack. You can e-mail him at fightopinion - at - protonmail dot com.