WWE as a business has been in trouble
before and with the worryingly sluggish PPV numbers posted by its recently established
platform, WWE Network, It looks like WWE may end find itself in deep water once
again.
Though that the WWE Network
posted better numbers in its last quarter ( 667,287 in Q1 and 700,000 in Q2),
the number are less than impressive to say the least[1].
The sluggish PPV numbers added with the exorbitant cost of establishing the
network has culminated in the WWE posting a quarterly loss forcing the
operation to cut 7% of its workforce that may save them $30 million over the
next two years[2].
The process has already begun
with a string of stars on the WWE rosters being forced out of the organization.
The organization has also released production and office staff in order to cut
costs and most notably have cancelled the production of WWE magazine as “WWE
Magazine staff has also been let go”[3].
The process also looks to affect future WWE events with reported cuts to be
made on “WrestleMania pyrotechnics next year” as well as “Bringing back the
combined RAW and SmackDown “Supershow” tapings next year”[4].
However, for all the press
prompting the demise of the WWE, the problems the WWE has encountered with WWE
Network are largely fixable. The number one way to make WWE network a money it
can be in the long term is global licensing and distribution which WWE are
already working on as they sealed “a partnership with Rogers Communications,
the largest cable provider in Canada, where Rogers will distribute Raw and
Smackdown along with offering the WWE Network as a subscription-based channel”[5].
This deal represents a good
move on WWE part but this doesn’t allay fears that it’s international numbers
are less than encouraging to say the least according to the Motley Fool:
“The company last week did not
break down PPV sales between the U.S., where the network is available, and the
rest of the world, where it isn't. But it did provide worldwide totals.
Globally, WrestleMania did 690,000 buys, Extreme Rules did
108,000, Payback did 67,000, and Money in the Bank did
122,000. Those are huge drops from 2013, when WrestleMania did
1.1 million buys, Extreme Rules did 245,000, Payback did
198,000, and Money in the Bank did 223,000”[6].
In sum, WWE may have had a bad
quarter largely caused by the underwhelming performance of WWE Network but with
the hope of an international roll out of the network overseas, the WWE hopes
that its big bet on its own platform will come good but early signs say the WWE
hierarchy are going to eat a few ugly quarters before their hopes for WWE Network materialize.
[1] V.
Johnson, 2014, Is WWE’s financial future in jeopardy?, http://www.philly.com/philly/blogs/the-squared-circle/Is-WWEs-financial-future-in-jeopardy.html
[2]
Ibid
[3] D.
Scarpa, 2014, WWE Magazine To Cease Production, http://whatculture.com/wwe/wwe-magazine-cease-production.php
[4] M.Middleton,
2014, WWE Possibly Bringing Back Combined Tapings, News on Pyrotechnics At
WrestleMania 31, http://www.wrestlinginc.com/wi/news/2014/0803/579636/wwe-possibly-bringing-back-combined-tapings/
[5]
Ibid
[6] D.
Kline, 2014, WWE Network Numbers Put Company’s Future at Risk, http://www.fool.com/investing/general/2014/08/03/wwe-network-numbers-out-whole-company-at-risk.aspx
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