Report : Raw Staying With NBC Universal, Smackdown will not.

[Ewa PGH Fan]

At this point I can only repeat what I've said in other posts. Not that it's your fault, the argument has gone on too long and it's difficult to keep up with the whole thing so I'll try to make this as concise as possible. Edit, not concise as possible , as long winded as possible

I'm not saying a "top indy/lower card WWE" talent roster is going to immidatley compete with Raw or SD's ratings. Jay Lethal and Dolph Ziggler as the flagship stars on a prime time ESPN show probably peaks at about a million viewers.

Here's what I think could be game changing:
Build a show around the Elite and then sign Dean Ambrose and Seth Rollins from the WWE. What would be the incentive for Rollins and Ambrose? Eveything I've read online (can't verify accuracy) indicates they make a few million a year. Guarantee them both 5 million a year and give them a larger cut of merchandise royalties. If it's an ESPN wrestling show you market it heavily on the network and perhaps even draw an initial rating from the lapsed fan demographic to go along with everyone interested in wrestling who's not 100 percent loyal to the WWE as the only company they'll ever watch. Rollins/Ambrose would be taking a risk. If the new company folds in a couple years you know they're in Vince's doghouse for eternity. If it succeeds (can't overstate how important this is) wrestlers have a second major option and will get paid their true market value. Maybe that's not a worthwhile risk for Ambrose or Rollins. You would just need a handful of other prominent stars willing to make the jump.

About being "willfully ignorant" on the brand issue. Do I think a new wrestling company could match the WWE in network subscriptions, merchandise sales, house show attendance, WM gate etc. No in certain ways the brand is too far ahead. Hyping a TV show (where the money is) would be very, very easy in the internet era if there's big business behind it. The other aspects of the brand would take time to grow.

Last point (paraphrasing) "nobody's competed with WWE in decades, it's a bad investment".. Here's my point. Forget about the last 15 years because the new TV deal changes the whole landscape. WWE shows are creatively stagnant, ratings are in a valley, fan morale is at low.... And the value of the TV rights is worth 3 and 4 times as much as it was a few years ago. I don't work for Merrill Lynch but between the TV situation and an independently run arena show selling out in a half hour now would seem like the time for someone with a lot of money to challenge them. If it's not, and everyone else is here is right, it's WWE and the glorified indies for good

TLDR; Wrestling content is worth lots of money on TV. Wonder if anyone notices

Last point and then we can move on. WWE wrestling content is worth lots of money. There is no proof what so ever that any wrestling content is worth a lot of money. If any wrestling content was valuable networks etc...would be knocking on Impact and ROH's doors trying to strike deals and they're not. Maybe sometime in the future but more than likely not. The biggest problem with your model is you have a lot of upfront and ongoing outlays but what are your revenue streams??? Production is not cheap and wrestling can't be shot just anywhere. If you don't have big steady money coming in you are just another TNA or ECW when it got on Network TV. And I just don't see how you convince somebody to give you a lot of money for an unproven production with an unknown audience. You're gonna have to establish your promotion first and as we've all seen over the last 2 decades, that is a lot easier said then done.

 

[Ewa PGH Fan]

It depends on the indy guy you're talking about. The lower level guys, yes. But guys like Cody, The Bucks, Jay Lethal, etc can make just as much money on the indies if they are good at promoting themselves and selective with their dates than they can with WWE depending on their place on the card. Top WWE guys make top dollar, but the vast vast majority of them are low 6 figures. And that's for like a 350 day schedule. The top guys on the indies can make that same money for half as many days. The Bucks has used this very reason for saying why they are fine if they never decide to make the jump to WWE because they make cash, work less, and have more time with their families. Other guys still make the jump (like Kevin Owens or Adam Cole), but its not just money. They could live comfortably being a top Indy guy. They just want the opportunity to perform on the biggest stage.

So I think @futballiscool has a point when he says if some really rich guy came in he could lure away plenty of the lower card WWE guys and top indy guys and make a rival promotion. It really would be similar to Turner opening up the checkbook to attract talent. But I also think he's being willfully ignorant if he thinks its that easy. Brand does matter. That's why WWE got the contract it did. They earned it through their work over decades, not because networks are desperate for programming and any old wrestling will do. There's a reason no other promotion has popped up since WCW died and it ain't for lacking of trying. It's because its hard and WWE has leveraged out the market. Networks know this. Smart investors know this. They aren't going to give you cash to take on a behemoth like WWE because its a losing proposition. There's a chance it works, but there's a huge chance you fail. That's bad business.

The way another promotion is going to pop up is not to compete with WWE directly, but to out-innovate WWE. Identify what they aren't doing, work the margins, and grow a new market there. That's where the money is. And that's what I was hinting at with my earlier post using All In as an example. Some decision makers and investors using that show as an idea launching pad, coming up with something, and marketing it differently like airing on Netflix, marketing through social media, etc etc.

You hit the nail on the head with your last paragraph. You have to find a niche. The biggest problem is that WWE has conditioned fans to what wrestling is and that is a very hard obstetrical to overcome. The other problem is while I agree that's where the money is no one knows how much and if it's enough to be profitable. MTV and some other cable networks have started their own promotions/wrestling shows over the last 10 years or so and none of them have taken off the ground or stuck around very long. And there has been a wide variety of styles and gimmicks tried but nothing has taken off. everything from hardcore to lucha and everything in between.

The other big obstetrical is WWE has very high production values and any wrestling show that falls short of that, we tend to look down upon. We've been conditioned to expect it. I guess this kinda falls under my first what wrestling is point but high production values aren't cheap.

All that said, someone could still come along and find that niche that takes off. My biggest worry is that if no one is trying to find that niche or everyone stops then WWE has a true monopoly and that is not good for fans.

 

[futballiscool]

Last point and then we can move on. WWE wrestling content is worth lots of money. There is no proof what so ever that any wrestling content is worth a lot of money. If any wrestling content was valuable networks etc...would be knocking on Impact and ROH's doors trying to strike deals and they're not. Maybe sometime in the future but more than likely not. The biggest problem with your model is you have a lot of upfront and ongoing outlays but what are your revenue streams??? Production is not cheap and wrestling can't be shot just anywhere. If you don't have big steady money coming in you are just another TNA or ECW when it got on Network TV. And I just don't see how you convince somebody to give you a lot of money for an unproven production with an unknown audience. You're gonna have to establish your promotion first and as we've all seen over the last 2 decades, that is a lot easier said then done.

We should all agree to disagree on this. There are so many strawman arguments here it's really difficult to respond at this point.

It's not worth repeating the same points over and over.

 

[The Q]

Because building a good product that garners a big enough following and ratings to get this kind of scratch is very very hard and easier said then done. It requires a couple boat loads of money to get off the ground not to mention succeed and losing your shirt is a lot more likely than ever making any profits. See TNA/Impact as one example. You could also cite ECW and WCW as well because while they both had some success, in the end they both lost a boat load of money and were closed/sold very cheaply.

Also look at long it took Vince to get WWE to this point. WWF/E started in the late 70's/early 80's and it's just now garnering this type of TV deals.

Yeah I’m not sure wcw ever made Money in the 90s.

And turner didn’t care. It was his baby for his real life feud with Vince. And he almost won. So close.

 

[futballiscool]

Yeah I’m not sure wcw ever made Money in the 90s.

And turner didn’t care. It was his baby for his real life feud with Vince. And he almost won. So close.

200 Million grossed in 98, 55 Million of that was a profit

 

[The Q]

200 Million grossed in 98, 55 Million of that was a profit

Wow. Thanks. That’s amazing.

 

[wildturkey]

At this point I can only repeat what I've said in other posts. Not that it's your fault, the argument has gone on too long and it's difficult to keep up with the whole thing so I'll try to make this as concise as possible. Edit, not concise as possible , as long winded as possible

I'm not saying a "top indy/lower card WWE" talent roster is going to immidatley compete with Raw or SD's ratings. Jay Lethal and Dolph Ziggler as the flagship stars on a prime time ESPN show probably peaks at about a million viewers.

Here's what I think could be game changing:
Build a show around the Elite and then sign Dean Ambrose and Seth Rollins from the WWE. What would be the incentive for Rollins and Ambrose? Eveything I've read online (can't verify accuracy) indicates they make a few million a year. Guarantee them both 5 million a year and give them a larger cut of merchandise royalties. If it's an ESPN wrestling show you market it heavily on the network and perhaps even draw an initial rating from the lapsed fan demographic to go along with everyone interested in wrestling who's not 100 percent loyal to the WWE as the only company they'll ever watch. Rollins/Ambrose would be taking a risk. If the new company folds in a couple years you know they're in Vince's doghouse for eternity. If it succeeds (can't overstate how important this is) wrestlers have a second major option and will get paid their true market value. Maybe that's not a worthwhile risk for Ambrose or Rollins. You would just need a handful of other prominent stars willing to make the jump.

About being "willfully ignorant" on the brand issue. Do I think a new wrestling company could match the WWE in network subscriptions, merchandise sales, house show attendance, WM gate etc. No in certain ways the brand is too far ahead. Hyping a TV show (where the money is) would be very, very easy in the internet era if there's big business behind it. The other aspects of the brand would take time to grow.

Last point (paraphrasing) "nobody's competed with WWE in decades, it's a bad investment".. Here's my point. Forget about the last 15 years because the new TV deal changes the whole landscape. WWE shows are creatively stagnant, ratings are in a valley, fan morale is at low.... And the value of the TV rights is worth 3 and 4 times as much as it was a few years ago. I don't work for Merrill Lynch but between the TV situation and an independently run arena show selling out in a half hour now would seem like the time for someone with a lot of money to challenge them. If it's not, and everyone else is here is right, it's WWE and the glorified indies for good

TLDR; Wrestling content is worth lots of money on TV. Wonder if anyone notices

Your first paragraph about building a show is exactly where the disconnect is about what everyone here is telling you that you can't understand. We totally get what you're saying, but you don't see how it can't be done. Look at those numbers you used. 5 million for a top star. And you'd need a few. That's a TON of initial investment just for talent before you even get to the other expenses of running a promotion. To start up, you'll be operating at a loss for years. It worked for Ted Turner for two very important reasons A) He was a billionaire that didn't care he was eating his own money and probably the most important B) He had is own network. He could pour his own money into luring talent and could ignore any costs and expenses in building a brand since he had his own network. His situation is entirely the exception, not the rule. You brought up Mark Cuban but its not even close to being the same, especially since Axs has far far less reach than Turner Broadcasting (TBS was FREE over the air TV throughout the South, aka WCW's most popular region, when Turner purchased it). That situation doesn't exist anymore. Network slots, especially on popular channels, are at a premium. They aren't handing out those slots and the fat cash that comes with it without a PROVEN track record of success which WWE has. And again, you're not going to be able to find many if any investors to operate at a loss throwing millions at talent early on in the situations you're describing. There is a market for another promotion but you're vastly overestimating the size of it and the ease of success that would come if tapped into. "Big Business" just can't wave a magic wand. You're gonna have to work the margins, innovate, and be successful at growing that nugget of the market you carve out for years before you can sniff a fraction of the contract size WWE just pulled.

 

[futballiscool]

Your first paragraph about building a show is exactly where the disconnect is about what everyone here is telling you that you can't understand. We totally get what you're saying, but you don't see how it can't be done. Look at those numbers you used. 5 million for a top star. And you'd need a few. That's a TON of initial investment just for talent before you even get to the other expenses of running a promotion. To start up, you'll be operating at a loss for years. It worked for Ted Turner for two very important reasons A) He was a billionaire that didn't care he was eating his own money and probably the most important B) He had is own network. He could pour his own money into luring talent and could ignore any costs and expenses in building a brand since he had his own network. His situation is entirely the exception, not the rule. You brought up Mark Cuban but its not even close to being the same, especially since Axs has far far less reach than Turner Broadcasting (TBS was FREE over the air TV throughout the South, aka WCW's most popular region, when Turner purchased it). That situation doesn't exist anymore. Network slots, especially on popular channels, are at a premium. They aren't handing out those slots and the fat cash that comes with it without a PROVEN track record of success which WWE has. And again, you're not going to be able to find many if any investors to operate at a loss throwing millions at talent early on in the situations you're describing. There is a market for another promotion but you're vastly overestimating the size of it and the ease of success that would come if tapped into. "Big Business" just can't wave a magic wand. You're gonna have to work the margins, innovate, and be successful at growing that nugget of the market you carve out for years before you can sniff a fraction of the contract size WWE just pulled.

I appreciate your post. We disagree but at least I see where and why.

You think the costs for someone to invest in top talent and start up a wrestling promotion are prohibitive. I don't think that at all. I don't think procuring TV time would be an issue if this was a big investor with a big budget and contacts ( I used Mark Cuban as a hypothetical name. I used ESPN too)

WWE is getting close to 400 Million dollars a year for TV. Non-rhetorical question, legitimately ... If they're still putting on a lukewarm product but the need for live TV content nets their next TV contracts over a billion dollars a year does anyone try to start a major TV centric wrestling company at that point?

It's not "waiving a wand". It's investing (and risking) money with the chance to make a lot more it.

 

[wildturkey]

I appreciate your post. We disagree but at least I see where and why.

You think the costs for someone to invest in top talent and start up a wrestling promotion are prohibitive. I don't think that at all. I don't think procuring TV time would be an issue if this was a big investor with a big budget and contacts ( I used Mark Cuban as a hypothetical name. I used ESPN too)

WWE is getting close to 400 Million dollars a year for TV. Non-rhetorical question, legitimately ... If they're still putting on a lukewarm product but the need for live TV content nets their next TV contracts over a billion dollars a year does anyone try to start a major TV centric wrestling company at that point?

It's not "waiving a wand". It's investing (and risking) money with the chance to make a lot more it.

Because their product isn't lukewarm. Fans may be disgruntled with storylines and say its stale, but business wise its not all. It's actually hot. Ratings are down, but they are down across the board for every TV show. WWE's are actually still fairly steady despite the overall TV trend. Their revenues are going up and are healthy. Their network has been a success. They've done a tremendous job courting Fortune 500 companies and name brands to be sponsors and advertisers which was non-existent for years because the business world sees wrestling audience as less than desirable. Their stock, even prior to this TV deal, has risen gradually over the years. They are a healthy business. That's what I'm referring to in the power of the brand. Pro wrestling didn't get this big TV deal, WWE did. That's how far ahead they are from the rest of the field. They actually transcend the market of pro wrestling. That's why the prospects for another pro wrestling company without that resume from the last 2 decades of hard work to get a deal like that are far far lower than you realize.

 

[futballiscool]

Because their product isn't lukewarm. Fans may be disgruntled with storylines and say its stale, but business wise its not all. It's actually hot. Ratings are down, but they are down across the board for every TV show. WWE's are actually still fairly steady despite the overall TV trend. Their revenues are going up and are healthy. Their network has been a success. They've done a tremendous job courting Fortune 500 companies and name brands to be sponsors and advertisers which was non-existent for years because the business world sees wrestling audience as less than desirable. Their stock, even prior to this TV deal, has risen gradually over the years. They are a healthy business. That's what I'm referring to in the power of the brand. Pro wrestling didn't get this big TV deal, WWE did. That's how far ahead they are from the rest of the field. They actually transcend the market of pro wrestling. That's why the prospects for another pro wrestling company without that resume from the last 2 decades of hard work to get a deal like that are far far lower than you realize.

The product being lukewarm was strictly in regards to their TV shows. I was being generous in my description if anything. A week ago I might have agreed with all of the factors about network subscriptions etc. That's irrelevant. The money now is all in TV. This isn't deflation where even though the ratings are down numerically they're up. 1/3 as many people are watching wrestling on Monday nights as they were during its peak in the late 90s. Hogan and Andre had 33 million viewers for their match on NBC 30 years ago. The TV product is not in a boom period. The skyrocketing rights fees are all about the TV landscape and wrestling drawing live viewers. I think they're vulnerable in the sense that their money is in TV but TV is where someone with financial backing and a stong creative vision can compete right away.

About the corporate image, and the WWE brand and it's WWE not wrestling etc. I couldn't disagree more. They're doing business with a Saudi government that treats women like second class citizens and where homosexuality is punishable with torture and death. I'm not here to moralize their corporate descions but there's no way this is a prestige brand. The WWE sponsorship money is rooted in their live ratings and overall demographics. Nothing else. If someone can recreate those factors they'll get similar money. It'll take time to establish a track record as dependable as WWEs but if a show gets ratings quickly advertisers will notice.


This isn't a smark "I hate the E, I want Bill Gates to buy my favorite wrestlers and put them out of business" argument. I just think there's too much money in televised wrestling to be monopolized by one person's vision. If anything I'm loyal to the company and want them to do well but they need competition.

 

[TheRobotDevil]

Your first paragraph about building a show is exactly where the disconnect is about what everyone here is telling you that you can't understand. We totally get what you're saying, but you don't see how it can't be done. Look at those numbers you used. 5 million for a top star. And you'd need a few. That's a TON of initial investment just for talent before you even get to the other expenses of running a promotion. To start up, you'll be operating at a loss for years. It worked for Ted Turner for two very important reasons A) He was a billionaire that didn't care he was eating his own money and probably the most important B) He had is own network. He could pour his own money into luring talent and could ignore any costs and expenses in building a brand since he had his own network. His situation is entirely the exception, not the rule. You brought up Mark Cuban but its not even close to being the same, especially since Axs has far far less reach than Turner Broadcasting (TBS was FREE over the air TV throughout the South, aka WCW's most popular region, when Turner purchased it). That situation doesn't exist anymore. Network slots, especially on popular channels, are at a premium. They aren't handing out those slots and the fat cash that comes with it without a PROVEN track record of success which WWE has. And again, you're not going to be able to find many if any investors to operate at a loss throwing millions at talent early on in the situations you're describing. There is a market for another promotion but you're vastly overestimating the size of it and the ease of success that would come if tapped into. "Big Business" just can't wave a magic wand. You're gonna have to work the margins, innovate, and be successful at growing that nugget of the market you carve out for years before you can sniff a fraction of the contract size WWE just pulled.

WWE actually just made a few big signings yesterday. io Sharai is the one i'm looking forward to most. Hopefully they don't waste her talent. She's a show stopper. Major draw elite athlete arguably the best women's wrestler in the world. Great business move. Vince is poaching Joshi. Nabbed there top three in the past three years imo

 

[Duffman]

The Hollywood Reporter featured a detailed piece today on how FOX nabbed the rights to WWE Smackdown in a deal that is expected to bring World Wrestling Entertainment over $1 billion and as it turns out, FOX patriarch Rupert Murdoch was intricate to the deal being made.

According to THR, NBC Universal had expected to sign a new 10-year deal with WWE for $360 million per year to retain the rights to WWE programming. Their exclusive right to negotiate that new deal expired on 5/16 when they decided to focus on keeping Raw and letting Smackdown go out on the open market.

This move was a huge positive for WWE as FOX was already waiting in the wings to make their move. Weeks before the NBC exclusive window expired, CAA's Nick Khan (who was representing WWE in the TV negotiations) was contacted by FOX Chairman Peter Rice, who stated that should WWE not make a deal with NBC Universal, FOX wanted to meet with the company immediately for the rights to the Smackdown franchise.

With Smackdown on the free market as of 5 PM on 5/16, a meeting was set for the next morning. On 5/17, WWE, represented by Triple H, Stephanie McMahon, Michelle Wilson and George Barrios among others (but not Vince McMahon) visited the headquarters of 21st Century FOX in Manhattan alongside CAA’s Khan to hear a pitch from Rupert Murdoch as well as Fox Sports executives Eric Shanks and Larry Jones. FOX CEO Lachlan Murdoch joined the meeting via telephone.

Murdoch pitched to the WWE Executives that NBC Universal was “embarrassed” by WWE’s product, but FOX would be all in, integrating Smackdown promotion into FOX broadcasts including Major League Baseball and National Football League broadcasts. The pitch also included the idea of a weekly WWE “studio show” on FS1 as well.

At the meeting, FOX TV screens in the room featured WWE photos, including Ronda Rousey shots, with the FOX and FS1 logos superimposed, pushing the marriage of the two brands. The Hollywood Reporter story indicated that was a major icebreaker between the two sides and that Murdoch also pitched the partnership as a marriage between the Murdoch and McMahon families.

WWE became an important get for FOX as they plan to reboot their company once they have finalized the sale of their movie studio and other assets to The Walt Disney Company. New FOX, as it has been dubbed, will build the nucleus of its broadcasting business around live and sporting events. Smackdown anchoring its programming on Fridays was part of their strategy. They had opted to let UFC go, feeling they couldn't sell it to advertisers, but with WWE as a family-friendly product, the sales pitch was much easier for FOX. WWE was their goal and they sealed the deal.

It should be noted that NBC had the right to match any offer that was $200 million per year, but at $205 million per year, FOX prevented NBC from being able to change their minds and retain Smackdown.

The FOX-Smackdown deal, should it close as expected, will be for five years starting in October 2019, worth over $1 billion dollars total, broken down to $205 million per years. That puts Smackdown on FOX through October 2024.

NBC Universal’s deal for Raw to remain on the USA Network is expected to be $265 million per year and will be a ten-year pact. That deal would be worth $2 billion, 650 million dollars.

WWE had been paid $130 million per year for Raw AND Smackdown under the old NBC deal, so they have hit a grand slam with all the bases loaded here. It is a massive victory for World Wrestling Entertainment, one even larger than first imagined when the FOX news hit.

 

[Racer8825]

The Hollywood Reporter featured a detailed piece today on how FOX nabbed the rights to WWE Smackdown in a deal that is expected to bring World Wrestling Entertainment over $1 billion and as it turns out, FOX patriarch Rupert Murdoch was intricate to the deal being made.

According to THR, NBC Universal had expected to sign a new 10-year deal with WWE for $360 million per year to retain the rights to WWE programming. Their exclusive right to negotiate that new deal expired on 5/16 when they decided to focus on keeping Raw and letting Smackdown go out on the open market.

This move was a huge positive for WWE as FOX was already waiting in the wings to make their move. Weeks before the NBC exclusive window expired, CAA's Nick Khan (who was representing WWE in the TV negotiations) was contacted by FOX Chairman Peter Rice, who stated that should WWE not make a deal with NBC Universal, FOX wanted to meet with the company immediately for the rights to the Smackdown franchise.

With Smackdown on the free market as of 5 PM on 5/16, a meeting was set for the next morning. On 5/17, WWE, represented by Triple H, Stephanie McMahon, Michelle Wilson and George Barrios among others (but not Vince McMahon) visited the headquarters of 21st Century FOX in Manhattan alongside CAA’s Khan to hear a pitch from Rupert Murdoch as well as Fox Sports executives Eric Shanks and Larry Jones. FOX CEO Lachlan Murdoch joined the meeting via telephone.

Murdoch pitched to the WWE Executives that NBC Universal was “embarrassed” by WWE’s product, but FOX would be all in, integrating Smackdown promotion into FOX broadcasts including Major League Baseball and National Football League broadcasts. The pitch also included the idea of a weekly WWE “studio show” on FS1 as well.

At the meeting, FOX TV screens in the room featured WWE photos, including Ronda Rousey shots, with the FOX and FS1 logos superimposed, pushing the marriage of the two brands. The Hollywood Reporter story indicated that was a major icebreaker between the two sides and that Murdoch also pitched the partnership as a marriage between the Murdoch and McMahon families.

WWE became an important get for FOX as they plan to reboot their company once they have finalized the sale of their movie studio and other assets to The Walt Disney Company. New FOX, as it has been dubbed, will build the nucleus of its broadcasting business around live and sporting events. Smackdown anchoring its programming on Fridays was part of their strategy. They had opted to let UFC go, feeling they couldn't sell it to advertisers, but with WWE as a family-friendly product, the sales pitch was much easier for FOX. WWE was their goal and they sealed the deal.

It should be noted that NBC had the right to match any offer that was $200 million per year, but at $205 million per year, FOX prevented NBC from being able to change their minds and retain Smackdown.

The FOX-Smackdown deal, should it close as expected, will be for five years starting in October 2019, worth over $1 billion dollars total, broken down to $205 million per years. That puts Smackdown on FOX through October 2024.

NBC Universal’s deal for Raw to remain on the USA Network is expected to be $265 million per year and will be a ten-year pact. That deal would be worth $2 billion, 650 million dollars.

WWE had been paid $130 million per year for Raw AND Smackdown under the old NBC deal, so they have hit a grand slam with all the bases loaded here. It is a massive victory for World Wrestling Entertainment, one even larger than first imagined when the FOX news hit.

That's great news!!!