Sunday, March 30, 2014

Ultimate Warrior Lawsuit (2 hour podcast)

Wrestlenomics Radio Chronology
I recorded a great episode yesterday for Wrestlenomics Radio.  Bix joined the show for the full two hours and we spent more than half of the time discussing the Ultimate Warrior lawsuit(s).  It was a terrific show.  I hope you'll listen! 

Details of the SummerSlam 1991 Payoff Sheet is up at https://sites.google.com/site/chrisharrington/mookieghana-prowrestlingstatistics/summerslam1991 and http://imgur.com/a/HVO0C#0

Thursday, March 27, 2014

SummerSlam 1991 Payroll REVEALED

Great piece by @WoolyWoolhouse over at WhatCulture, WWE: 10 Surprising Revelations From The 1991 Summerslam Payroll Sheet



It's another fun companion piece to Bix's great piece about the Ultimate Warrior in the latest issue of FSM. The payroll for the event was one of the exhibits in the lawsuit which Bix was chronicling.

Also, as a follow-up to yesterday's discussion, it's pretty much been confirmed that the T-Rex skull on Vince's wall is a replica.  But it's still awesome.

Wednesday, March 26, 2014

Fact-Checking Forbes' piece on Vince McMahon



There were several claims made in this article that surprised or befuddled me.  Let's begin:
The shares are flying both because WWE is seeking a new television contract, at more than twice its current rate of $160.9 million

I wish articles could get this right - or at least be more specific. WWE is negotiating their domestic TV contract which was $105.9M in CY2013. Their international TV contracts were $55.0M in CY2013. They've already settled on the UK BSkyB deal which was rumored to be at "three times the previous five year agreement" and starts in 2015 and the Germany deal with Tele 5 which starts in April 2014. I believe they are also working on their TV deal in India (currently on Ten Sports) which has historically been coming up in 5-year increments (2005-2009, 2010-2014) so would likely start in 2015.

...persistent speculation that McMahon, who has never articulated a clear succession plan, might sell the company outright (both Comcast and the Madison Square Garden Co. have been rumored as suitors)

I also wrote about "the 5 types of companies that would want to buy WWE" but I don't believe it's going to happen at all.

Another bright spot: Emerging market revenue has been growing at a 7% annual rate for a decade in countries such as India, Mexico, and even South Korea, to $116 million last year.

That is a baffling claim. WWE made $507,970,000 in revenue in 2013. $391,663,000 was in North America. That's leaves $116,307,000 so apparently they're considering UK, the WWE's "largest international market" as part of the "emerging market revenue". I think it's questionable to consider a market that WWE has been in for more than twenty years to be "emerging".



So, in the past five years, Latin American (Mexico) revenue has dropped from $12.4M to $6.6M, UK was essentially been flat, other Europe/Africa/Middle East (which include India) is down 5%. The only area of growth is Asia Pacific and that's going to be pretty diverse: Japan, South Korea, Philippines, China, etc.
It’s a move that directly endangers both WWE’s PPV revenues ($82.5 million)
Domestic PPV revenue in 2013 was $66.9M. International PPV revenue was $15.6M. Again, since you're talking about the launch of the domestic WWE Network, it would make more sense to differentiate between the two.
In his black-and-red office at WWE headquarters in Stamford, Conn. McMahon stares at a stark reminder of what motivates him. To the left of his desk, mounted on square panels of what looks like scarlet fur, is an enormous dinosaur skull. The fearsome open jaw was a gift from his son-in-law, Paul Levesque, better known to wrestling fans by his nom de guerre, Triple H. And the metaphor isn’t lost on McMahon.


(From the Multi-channel News interview in July 2012)

Or it could be the competition–whether it’s mixed martial arts, the NFL or Marvel superhero movies that are vying for his younger viewers, 21% of whom are under 18.
Their website says 19%. Either way, that sounds right.

Over the past two years WWE has spent $75 million preparing for the launch of the WWE Network, which went live on Feb. 24.
That's an interesting number. At the last conference call they said:
Daniel Moore - CJS Securities, Inc.: Okay, and then lastly and then I will jump back in queue, I know it’s tough to break out but what would be a ballpark range total spend in 2013 on the P&L for the build out our anticipation of the network?
George A. Barrios: We probably had about $12 million that you could directly associate with the network on the P&L, but obviously that doesn’t include the marketing cost, customer services cost, transmission cost and so on so forth that, come about when we go live.
He has been promising fans and investors a WWE Network since 2011, and in that time the vision for it has changed dramatically. It was first conceived as WWE’s version of the MLB or NFL Network. In theory a channel devoted to wrestling makes even more sense than a professional sports league, since, unlike baseball or football, WWE doesn’t have an off-season. (It puts on more than 300 live shows, 52 weeks a year.) But McMahon claims that model was only going to generate an anemic 20 cents per month per subscriber, roughly on par with third-tier networks like MSNBC and Bravo, $0.21 and $0.24 a month, respectively (almighty ESPN commands an astronomical $5.54 a month). So he walked away.
That's the first time I've heard specific numbers for what they would have received. The "Vince walked away" story was covered by the LA Times back in January.
For $9.99 per month (and a six-month commitment) subscribers will have access to more than 130,000 hours of WWE programming, matches that date back to the 1950s. There are also original programming and a “second screen” experience on the WWE app that allows viewers to interact with one another and watch live content during commercials.
There is like 1,500 hours of programming on the WWE Network. The 130,000 hour number is the total amount in their library. Big difference!

Naturally some of WWE’s television partners felt sucker punched by the over-the-top strategy. In advance of the launch DISH Network announced that it was dropping all WWE’s pay-per-views–including WrestleMania XXX on Apr. 6.
I assume this article was completed prior to learning that Dish apparently has relented and will carry WM.
In the end it was Ted Turner. In 2001 he sold the name rights of WCW to WWF for $2.5 million, plus the entire video library of matches. (Today you can watch them all on the WWE Network.)
As summarized by Voices of Wrestling:
McMahon bought the WCW trademarks for $2.5 million ($3.3 million with inflation) and later secured the archived tape library for $1.7 million, bringing the total to $4.2 million which translates to roughly $5.5 million with inflation.
While the WWE has yet to release how many subscribers it has to date, two longtime wrestling observers estimated that at least 250,000 signed up for the service on the first day, which would put the company well on its way to the million it needs to break even.
Wait. Is Forbes talking about what I wrote using the survey data that Bix gathered?
One analyst recently predicted the WWE could even exceed its own goals and acquire 6 million to 8 million subscribers.
WHO IS THIS ANALYST?  God help anyone who is letting this person control their money.

EDIT: It was Robert Routh in a CNN article.  That surprises me a little bit because Routh is a smart guy and has been covering WWE Stock for a very long time.  I once had a conversation with him back in January 2006.
Not everyone is sanguine about those prospects, however. Intrepid Capital Management was WWE’s largest outside shareholder until January 2014, when it sold its 10% stake in the public float at a 100% profit. Intrepid portfolio manager Jayme Wiggins believes the WWE Network will be a tougher sell. The network “is a slam dunk for a die-hard fan,” which Wiggins estimates to be a core of 700,000, “but I don’t think it’s going to be easy for them to get another 500,000.”

I AGREE COMPLETELY.

- Chris Harrington (@mookieghana) 
chris.harrington@gmail.com

Tuesday, March 25, 2014

Wellness Violations

Reviewing lists provided by http://www.wrestlingnewsworld.com/wwe/wwe-suspensions/ and http://www.pwpix.net/information/wwesuspensions/

Below are the violators of the WWE Wellness Policy since November 1, 2007
11/2/07 D.H. Smith (real name Harry Smith) – 30 days (1st)
11/2/07 Chris Masters (real name Chris Mordetzky) – 60 days (2nd)
1/16/08 Derrick Linkin (real name Derrick Neikirk)
1/16/08 Chett the Jet (real name Neil Bzibziak)
3/11/08 Jeff Hardy – 60 days (2nd)
3/20/08 Manu (real name Afa Anoa’i, Jr.) – 30 days ("Afa was believed to have been suspended not because he failed an actual Wellness Test but for trying to manipulate the test by not actually giving a real sample from his body.")
5/20/08 William Regal (real name Darren Matthews) – 60 days (2nd)
6/9/08 Jimmy Wang Yang (real name James Carson Yun) – 30 days (1st)
10/10/08 Dolph Ziggler (real name Nick Nemeth) – 30 days (1st)
6/8/09 Umaga (real name Eddie Fatu) – 2nd; "he was terminated for refusing to enter a rehabilitation program."
8/27/09 Rey Mysterio (real name Oscar Gutiérrez) – 30 days (1st)
5/21/10 Carlito (real name Carlos Colon) – 1st; released for "his refusal to enter a rehabilitation facility"
7/18/11 Sin Cara (real name Luis Ignascio) –1st
8/15/11 Mike Chioda – 1st
8/11 Andy Leavine - 30 days (1st)
10/6/11 Darren Young (real name Fred Rosser) – 30 days (1st) "suspended for smoking synthetic marijuana."
10/17/11 Heath Slater (real name Heath Miller) – 30 days (1st) "suspended for smoking synthetic marijuana."
11/1/11 Evan Bourne (real name Matthew Korklan) – 30 days (1st) "suspended for smoking synthetic marijuana."
11/22/11 R-Truth (real name Ron Killings) – 30 days (1st) "suspended for smoking synthetic marijuana."
1/17/12 Evan Bourne (real name Matthew Korklan) – 60 days (2nd) "suspended for smoking synthetic marijuana."
4/26/12 Rey Mysterio (real name Oscar Gutiérrez) - 60 days (2nd) "reportedly tested positive for amphetamines"
5/30/12 Randy Orton – 60 days (2nd.. or 5th) "positive test was caused by elevated testosterone levels due to Dianabol... traces of marijuana in his system."
7/2/13 Ricardo Rodriguez (real name Jesús Rodríguez) – 30 days (1st)

Others Prior to 11/1/07
2005 Randy Orton (2005): suspended for steroids?
4/4/06 Randy Orton: 60 days for “unprofessional conduct.” ("suspended for smoking marijuana backstage")
2006/2007 - Chavo Guerrero - Suspended for 30 days in 2006 or 2007
2007: Booker T - Suspended for 30 days in 2007
2007: Chris Kay - Suspended for 30 days in 2007
6/2006: Kurt Angle - Suspended for 30 days in June or July 2006
6/2006: Rene Dupree - Suspended for 30 days in June 2006
7/2006: Kid Kash - Suspended for 30 days in July 2006
7/2006: Rob Van Dam - Suspended for 30 days in July 2006
7/2006: Ryan Reeves (Ryback) - Suspended for 30 days in July 2006
8/2006: Randy Orton - Suspended for 30 days in August 2006
9/2006: Ryan O'Reilly - Suspended for 30 days in September 2006
9/2006 Balls Mahoney - Suspended for 30 days in September 2006
10/2006: Drew Hankinson (Luke Gallows) - Suspended for 30 days in October 2006
2/2007: Rene Dupree - Suspended for 60 days in February 2007
2/2007: Test - Suspended for 30 days in February 2007
4/2007: Chris Kay - Suspended for 60 days in April 2007
7/2007: Jeff Hardy - Suspended for 30 days in July 2007
8/30/07 Signature Pharmacy: suspended 10 performers
* Booker T - Suspended for 60 days on August 30, 2007
* Charlie Haas - Suspended for 30 days on August 30, 2007
* Chavo Guerrero - Suspended for 60 days on August 30, 2007
* Chris Masters - Suspended for 30 days on August 30, 2007
* Edge - Suspended for 30 days on August 30, 2007
* Funaki - Suspended for 30 days on August 30, 2007
* Gregory Helms - Suspended for 30 days on August 30, 2007
* John Morrison - Suspended for 30 days on August 30, 2007
* Mr. Kennedy - Suspended for 30 days on August 30, 2007
* Snitsky - Suspended for 30 days on August 30, 2007
* Umaga - Suspended for 30 days on August 30, 2007
* William Regal - Suspended for 30 days on August 30, 2007

New Wrestlenomics Radio, New WhatCulture Pieces, New everything!

This month I started exclusively writing stuff over at WhatCulture.com. I've also had several friends start publishing pieces over there as well.

Looking for something to read? Here's we go!


Things I've written:
WWE Wrestlemania 30: Why Dish relented and Will Carry It 3/25/14 (new today!)
* WWE Royal Rumble & Elimination Chamber 2014 Buy Estimates 3/21/14
* WWE: John Cena Has Not Had 3,500 Matches 3/19/14
* WWE: Analysing The 5 Networks WWE Is Negotiating TV Rights With 3/18/14
* 5 Companies That Would Want To Buy WWE 3/15/14
* 10 Ways WWE Can Maintain Their Current Business Success 3/10/14
* WWE's Current 15 Year Stock High Is Tied To Their Domestic TV Future 3/5/14
* 14 WWE Network Risks That WWE Worries About 3/05/14

Things by my friends...


The Czar:
* WWE: 8 Reasons Bray Wyatt Will Fail After WrestleMania 30 3/24/14
* WWE: 10 Previous WrestleMania Triple Threat Matches 3/20/14
* 6 WWE Divas That Never Held The Title 3/16/14
* WWE: 14 Gross-Out Moments That Made You Gag 3/12/14
* WWE: 12 Most Memorable Animal Sidekicks 3/6/14


Woolhouse:
* WWE: 10 Sexiest Diva Moments In WrestleMania History 3/25/14 (new today!)
* WWE: Ranking The Previous 12 Battle Royals In Wrestlemania History 3/19/14
* WWE: 10 Worst Intercontinental Title Matches To Watch On The WWE Network 3/12/14
* WWE: 12 Careers You Won’t Believe Stars Did After They Quit Wrestling 3/8/14
* WWE: 16 Other Wrestlers Who Are Undefeated At Wrestlemania 3/6/14


Hawkins (Crapgame13):
* WWE: 10 Times Real Life Political Troubles Fueled Top Heels 3/24/14

The other guys are a lot better writers than I am. There's a lot of lists, but you'll still see them raise some really interesting points.

For instance, one of my favorites was from Tom's piece about 8 Reasons Bray Wyatt Will Fail After WM30 #6:
Bray Wyatt cuts a great promo. He leads men into battle and they listen to every word he says. He watches intently ringside, invested in every move and movement his “Family” makes. He celebrates when they win; he scolds them when they lose. Now replace “Bray Wyatt” with Bobby Heenan and the last few sentences still read the same.
And yes, they're paid by the click so that's why you'll see people work on click-bait pieces like WWE: 10 Sexiest Diva Moments In WrestleMania History and they feel no shame for that. Nor should they.


Lastly, Pete Thornton has been getting lots of people agitated with his non-pro wrestling pieces including 10 Superheroes Who Should Get A Movie Before Wonder Woman and 10 Reasons Frozen Is Definitely NOT Disney’s Best Animated Movie This Decade. That's kind of his MO in life, so I am very amused.
In other news, I've got a new piece that should go live on WhatCulture in the next 24 hours:
  • What SIX jobs does WWE need to create?
My WC editor has it now and are trying to strangle it into comprehensible English.

Also, a NEW EPISODE OF WRESTLENOMICS RADIO is available.  It's two hours long and we talk about some original WWE Rookie analysis I completed, WWE TV negotiations (including newcomer WGN), thoughts on the Royal Rumble & Elimination Chamber 2014 PPV numbers and a list of who has most of the worst pro-wrestling feuds of the last twenty years.  Also, we have live callers from around the world (literally).  Next live episode of Wrestlenomics radio will be this Saturday (3/29/14) at 1 PM EST/Noon CST with special guest David Bixenspan talking about Discrimination Lawsuits, Ultimate Warrior shenanigans, WCW Payroll and much more!  

Tuesday, March 18, 2014

Looking at the BIG FIVE NETWORKS

I've got a new piece up at WhatCulture analyzing the primary networks that been mentioned as potential bidders for the WWE domestic TV Rights (particularly Raw & Smackdown but also Total Divas, Superstars, Main Event, etc).


In the rumor-mill, there’s been five major conglomerates mentioned:
I look at the pro/con of each, particularly why they would and wouldn't be interested and whether they'd be a good fit.

The stock rally must be the TV deal, and I must admit that it's kind of confusing trying to sort out all of the vexing machinations.  Why would a network like Turner want to get back into the mix after more than a decade? (Are they trying to mess with USA? Are they hedging against losing TNT's NBA rights to Fox?) AMC is such a weird suitor, though they do have some "unscripted" programming like Comic Book Men or Small Town Security, so it's not like they're just Walking Dead & Mad Men. Fox would want to the ratings for FS1 but they wouldn't have a place for Total Divas, and it seems questionable whether they'd get both Raw & Smackdown. That pretty much just leaves Viacom and NBCU.  They both make sense as they've actually had the Raw contract. Right now, my gut still tells me they end up sticking with NBCU, but it's very possible that this stock surge may reinforce WWE's mentality that they deserve more.  And who knows if one of the TV networks might just bite down on that giant price-tag at the last second.


Cheap Plug: If you're looking for a consultant for your investment firm or hedge fund to discuss $WWE, feel free to email me at indeedwrestling@gmail.com

Monday, March 17, 2014

Hey Buddy, want to buy WWE?

In the last few days, there's been two pieces looking at $WWE and who would hypothetically be interested enough to purchase the whole company.
In the wake of Thursday's nutty stock spike & rumors, I became interested in the idea of what companies could conceivably integrate WWE.  In the end, my list of about dozen different types of entities was boiled down into five categories: (1) Mass Media Companies, (2) Internet Companies, (3) Crazy Billionaire, (4) Private Money/Sports Equity and (5) Live Event Promoter.

It's interesting to look at Lachapelle's list which includes: Comcast (Mass Media), MSG Square Garden Co. (Private Money/Sports Equity), AMC Media (Mass Media), Disney/Pixar (Mass Media) and Live Nation (Live Event Promoter).  At least I was able to come up with the same ideas as the big market analysts.

Of course, it's all a moot point since Vince McMahon controls over 90% of the voting rights for WWE through Class B shares which are exclusive to the McMahon Family and their Family trusts. VKM would have to want to sell, which seems highly unlikely based on history.

Also some good analysis by JDW over at ProWrestlingOnly discussing the enormous profit margins that Marvel, Pixar and LucasFilms had compared to WWE.  Honestly, this is all fun speculation, but it's not relevant.  WWE's lever of growth the past few years  has been TV Rights, and if they were acquired by a television company, that would just be passing money from left hand to right hand.  The agent of change for those companies is improving their advertising revenue from the shows.

Sunday, March 16, 2014

WWE 2014 Trading Cards & Wrestlenomics Episode 2

On a whim, on my way out of Target, I decided to buy a box of 2014 WWE Trading Cards.
 $19.99!

 
Each pack is covered with non-jorts Cena!

 
10 packs and one commemorative plate card!

 
Whose? Kaitlyn!

 
Congratulations!

The cards:
 
I was surprised to see legends, superstars, divas and NXT wrestlers. Yes, I found Jojo, Big Zeke, Paige, El Torito, Curt Hawkins, Drew, Hunico and DDP. But only one Wyatt Family member. Sad.

I also recorded Episode 2 of Wrestlenomics Yesterday.  It was a live call-in show via BlogTalkRadio.

The Beginning of Something Special
http://www.blogtalkradio.com/indeedwrestling/2014/03/15/the-beginning-of-something-special 

Episode Two of #wrestlenomics radio is done.

This was a spur-of-the-moment live call-in show where I talked about WWE Network, WWE Financials, WWE TV Negotations, ideas for possible WWE suitors, ways to keep the WWE stock strong, my interaction with investment banks/hedge funds asking about WWE and lots more.

It was like a sprint so I talked and talked and talked and had David Parker on and talked and talked and then hung up. Hopefully, there's some good content in there and it's not so frantic that it's unlistenable.

Thursday, March 13, 2014

New Audio and Weird Stock Spikes

I had a great conversation with my friend Alex Goff from Online World of Wrestling talking about the WWE Network, my history with Podcasts and pro-wrestling analytics and the nature of streaming media adoption.  It's a fun 45 discussion which you can listen to at their website or download the mp3 directly.  I had a lot of fun recording it.


Also, I wrote a piece on WhatCulture today's weird stock spike and the rumors behind it.  Since $WWE stock has got hot, I've talked to a few investment firms and hedge funds about the possible future for this company.  Moving forward, you'll find all my thoughts & analysis over at WhatCulture.
And while you're there, please check out some of my friends writing the website including:

Both of these men have been good friends and excellent sounding boards for articles for many years.  I hope you'll support them by reading this pieces and commenting helpful things such as, "WWE BEST 4 LIFE LOL LOVE U JON SINA! ".    They'd really appreciate that.

Friday, March 07, 2014

The Mystery of the Soaring Stock Price

WWE Stock PriceCloseChg vs
 Last Month
Friday, September 06, 2013$10.20 -2%
Monday, October 07, 2013$10.89 7%
Wednesday, November 06, 2013$12.72 17%
Friday, December 06, 2013$14.45 14%
Monday, January 06, 2014$15.48 7%
Thursday, February 06, 2014$22.70 47%
Thursday, March 06, 2014$29.80 31%



https://www.google.com/finance?chdnp=1&chdd=1&chds=1&chdv=1&chvs=maximized&chdeh=0&chfdeh=0&chdet=1394154377411&chddm=48484&chls=IntervalBasedLine&q=NYSE:WWE&ntsp=1&ei=iBsZU6iiDISmqgHcDQ

WWE Stock Price has been going up, up, up. 

 Not only does this ensure a steady stream of terrible wrestling-related puns on finance websites ...but provides plenty of vexing consternation for me as I try to figure out WHAT THE HECK IS GOING ON?

I've followed WWE Financials pretty closely for awhile.  (Just as my pals about the awful podcasts I used to do back in 2007 when I was on cold medicine and discussing the 10-Q statement.)  I scour the Annual Reports, I keep up with latest gossip on their Television Negotiations, I read the in-ring rumors and I follow the (free) trials and tribulations with WWE Network subscribership.  Yet, I am still confused at what's really going on!

Let's start with the latest breakdown of 2013 WWE Revenue:

Revenue201320122011Assessment
Domestic TV Rights$105.9 $88.9 $80.3 Currently negotiating; Announce by April
Domestic Live Events$81.4 $72.1 $64.9
Domestic PPV$66.9 $66.4 $61.3 Big impact from WWE Network
Int'l TV Rights$55.0 $50.6 $51.2 Renewed BSkyB (UK), India upcoming
Licensing$43.6 $46.3 $54.4
Int'l Live Events$30.1 $31.6 $39.8
Home Entertainment$24.3 $33.0 $30.4 Expect some impact from WWE Network
Venue Merchandise$19.4 $18.8 $18.3
WWE.com$23.0 $19.7 $12.5 Possible impact from WWE Network
Int'l PPV$15.6 $17.2 $17.0 Future Int'l WWE Network impact
WWEShop$15.5 $14.8 $15.6
WWE Studios$10.8 $7.9 $20.9 $54M in impairment charges since 2007
Misc.$10.8 $10.7 $9.6
Magazine Publishing$5.7 $6.0 $7.7 Dropped $10.8M since 2007
Total$508.0 $484.0 $483.9

In 2013, WWE revenue was $508M yet net income was a paltry $2.8M - the company was beset by WWE Network preparation (spent $23M in three years) and WWE Studios impairment costs (another $11.7M).

Still, the stock continues to rise; really the climb began right after the quiet Q3 conference call on Halloween morning where Vince promised great TV negotiation results (and said they could put him in a hammerlock if they failed.)

In terms of what's new to WWE this year, I can only think of two real factors:
 There's a ton of buzz about how innovative and game-changing the WWE Network is.  But a true evaluation of the over-the-top service would also note that it's controversial and risky.

The Fundamentals aren't changing.
  • Wrestlemania lacks a marque draw - nothing on the scale of Rock versus Cena (I/II) battles
  •  International Revenues are becoming less and less significant.  (See chart above on attendance.)
    WWE North American Attendance average surpassed the International Attendance average for the first time in a decade!
  • The previous top draws from the Biggest Raw Ratings Draws in 2011-2013 like the Rock and CM Punk aren't with the company currently.  We still have John Cena, Paul Heyman/Brock Lesnar and Triple H but new superstars haven't done much as the return of Batista was a one-and-done ratings blip and even bringing Hulk Hogan back to television didn't have a noticeable impact.  Bryan Daniel showed signs up being a rating draw but he's clearly a distant #2 to top guys like John Cena when it comes to live events.
  • Raw Ratings for Jan/Feb have been average (actually slightly lower than past years). 
  • New Television money isn't coming in until Q4 2014 (Domestic) and Q1 2015 (International) so financial forecast for 2014 is not looking very rosy.
  • Growing TV Rights have been because of new programming such as Total Divas and adding a 3rd hour of Monday Night Raw.  Shows like Main Event on Ion haven't impressed that television network and CW's Saturday Morning Slam wasn't even renewed.  WWE couldn't find buyers for Superstars or NXT previously so those were just international/OTT shows.
Historically, domestic PPV revenue was broken into three camps of buyers:
  1. Hardcore Fans (110,000) - 12x (all the monthly PPV) = spent $45+/month
  2. Regular Fans (290,000) - 3x (Royal Rumble, Summer Slam, Wrestlemania) = spent $12+/month 
  3. Occasional fans (260,000) - 1x (Wrestlemania) = spent $5+/month
Converting all of these fans into regular WWE Network susbcribers (660k x $10 x 12 months) generates $79.2M which is +$10M higher than 2013's domestic PPV, but that's a huge investment to barely replacing the PPV revenue (and hurt the WWE.com and Home Entertainment revenue).  It's not pure profit either because they're still paying for the PPV production.  And most importantly, they still need more than 300,000 new subscribers above that PPV base just to hit the million subscriber break-even point.  (They're getting some of that by pulling European fans into the domestic launch, but that just hurts their projections for the international launch in 9-18 months time.)

In fact, for 60% of the PPV fans that would hypothetically convert to the WWE Network, those fans were already spending more than $10/month annually so it's not a true "savings" to those fans. (WWE only got half of that revenue, which was what drove WWE wild and made them balk at sharing PPV revenue or premium channel revenue with the MVPDs.)  More than half of WWE's domestic PPV revenue comes from their most hardcore fans, and clearly those fans would have tolerated even higher prices for the WWE Network since they were already paying more than $45/month.  WWE essentially offered a price decrease to the majority of their regular fans.  What I'm waiting for is their comprehensive marketing campaign on how they're going to lure back lapsed fans beyond just promoting the WWE Network on their television shows, emails blasts and word-of-mouth through friends and occasional major media coverage.

For a project (WWE Network) that has $55M in costs before they even factor in the $60M in cannibalized revenue, I'm still not convinced that the WWE Network will be profitable in 2014.  That's not to say it's not a worthwhile venture - as a fan, I appreciate the opportunity to transform how many PPVs I watch annually, and it keeps me more engaged with the product.  There's certainly an important, yet hard-to-define halo effect from launching the WWE Network.  Perhaps more people will attend Live Events or some fans will return to watching programming weekly.  However, as an analyst, I view a project like WWE Network as, at best, break-even in terms of OIBDA.  That doesn't strike me as the sort of venture that should send the stock price skyrocketing.

So, if WWE Network isn't the main driver of growth, that just leaves the WWE Domestic TV Rights negotiations.  I went through the history and details elsewhere about why I think WWE will re-sign with NBCU, but I don't think they'll hit their massive rates increases above $220M (doubling rates).
The simplest reason is that expensive programming (like Sports) is paid for by advertising and, to a smaller extent, promoting other shows on the network.  Frankly, WWE stinks at both.  Wrestling fans are fickle and don't support most other shows.  The CPMs wrestling gets for the eyeballs they deliver are appalling. Advertisers don't believe the WWE Universe is going to spend the money.  If WWE has been successful in shopping around a new narrative, that would be a substantial win for the company. But I haven't seen any evidence of that, yet - at least not in print.  NBCU at least has some ideas on how to shake-up advertising, that could outline why WWE might get better rates in 2015 and beyond.

Originally, WWE's decision date for Domestic TV was supposed to be March 4 with an announcement coming in April.  It's unclear whether that was a firm deadline, or just posturing on their part so they could get things done early.  I believe that while the exclusive negotiation period with NBCU has expired, NBCU still has matching-rights which allow them to retain WWE if they pony up the same amount as the other bidders (top contenders assumed to be Viacom and Fox).

However, as it's plays out right now, the WWE is riding high. They're at their peak stock price and have vastly increased the McMahon family's wealth.  I can only conclude that investors seem confident that WWE is about to score a big win on TV rights (and to a lesser extent jaw-dropping WWE Network signup numbers).  I am just a lot more pessimistic.  

Drop me a line (twitter: @mookieghana), comments section or email (indeedwrestling@gmail.com) and explain what I'm missing.  I do appreciate it!

Wednesday, March 05, 2014

Oodles of Articles

Pieces that I've written and recently published on other websites:
2/18/2014 WhatCulture: WWE Raw: 16 Biggest Raw Ratings Movers
2/20/2014 WhatCulture: 10 Controversies of the WWE Network
2/23/2014 F4W/WO: 2013 WWE Financials Examined Wrestlenomics-style
2/24/2014 Voices of Wrestling: WWE 2013 & PPV Breakdown
2/25/2014 Voices of Wrestling: WWE Network Launch Day Estimation
2/25/2014 WhatCulture: WWE: 8 Modern PPVs That Performed Miserably
2/27/2014 WhatCulture: WWE Network Launch: All your Key Questions Answered
2/28/2014 Whatculture: 20 Most Prolific PPV Wrestlers Of All Time (WCW/WWF)
3/03/2014 F4W/WO: WWE Network 7 Days Later
3/05/2014 Whatculture: 14 WWE Network Risks That WWE Worries About
3/05/2014 Whatculture: WWE’s Current 15 Year Stock High Is Tied To Their Domestic TV Future
3/07/2014 Voices of Wrestling: The Mystery of the Soaring Stock Price
3/10/2014 Whatculture: 10 Ways WWE Can Maintain Their Current Business Success

Updated 83-page PDF about the WWE Network.


In terms of original material, Dave's done a stellar job in the Observer. Almost every issue in the past few months has talked about the WWE Network and/or the WWE Finances.

Here's some other original articles that I've relied on heavily for new information. While almost daily I look for new material, and I'm still discovering articles that I've missed (such as the AdAge one) that provide good insight on the chasm between TV/Advertising executives and WWE/Investors.

My list of other Good Reading Material regarding the Domestic TV Rights Negotiations:

Bonnie Hammer
10/9/2001 CNN: Bonnie Hammer: She is Sci Fi
Forbes: Power Women #61: Bonnie Hammer
12/19/2011 NYTimes: The Queen of Cable TV
WWE TV Rights
11/1/2013 Forbes: WWE's Hidden Gem (Chris Bevilacqua talks up WWE)
1/24/2014 NYPost: NBCUniversal, out to keep WWE, mulls Hall of Fame
1/29/2014 Hollywood Reporter: WWE, BSkyB Extend U.K. TV Deal
2/18/2014 LA Times: WWE shopping 'Raw,' 'Smackdown' and other TV properties (mentions that WWE had hired Bevilacqua)
2/18/2014 Variety: WWE’s ‘Raw,’ ‘SmackDown’ Could Find New Homes as Negotiating Window with NBCU Expires
2/19/2014 AdAge: WWE Will Struggle to Position Itself as Live Sports
2/24/2014 SEC: WWE 2013 Annual Report
2/25/2014 Motley Fool: Why WWE Might Not Get the TV Deal it Wants(includes quotes from Wrestling Observer's Ben Miller)
3/7/2014 Bloomberg Businessweek: WWE Expects New Cable-TV Deal by Early May, CFO Barrios Says

Sunday, March 02, 2014

Wrestlers who were in the ring with the World Champion (Omni)

Dave Meltzer, on the F4W/WO message board wrote:
You know what would be a project: Who had the most main events over a career combining --
  1. PPVs (every group that had them although you could argue TNA & ECW were never really major league at that level)
  2. MSG house shows (prior to monthly PPVs when MSG house shows were the second biggest priority)
  3. Atlanta Omni main events (until WCW went monthly)
  4. Greensboro Coliseum main events (until 1988)
  5. St. Louis main events (until 1985)
  6. Chicago main events (until 1985)
  7. Los Angeles main events (until 1975)
  8. SF Cow Palace main events (1961-76)
  9. Minneapolis main events (until 1985)
  10. Toronto main events (until 1984)
  11. Montreal main events (until International closed)
  12. Japanese Dome & Stadium shows
  13. Sumo Hall, Budokan Hall, Osaka Furitsu Gym/Castle Hall (or Nagoya Aiichi Gym or both)
  14. Dallas Reunion Arena (during its era)
  15. Houston (until 1986)
  16. New Orleans Superdome
I looked at prolific WWE & WCW PPV performers in my latest WhatCulture article.
I looked at MSG House shows in yesterday's IndeedWrestling blog.
I don't have results for all of these arenas listed, but there is information on The History of WWE concerning Omni shows from 1973-1996.  [1970s, 1980s, 1990s]

Main Events is always a tricky term.  Is it the last match? Is it the match that had the world champion involved?  I look at 1973-1993 and normalized names.

Let's start with who was in the matches that included the World Champion:






Another method of scoring "main events" is looking at people who were in the top quarter of the card.  Basically, I'll give a wrestler a point whenever they're in the final matches.  For instance, on an 8 match card, the wrestlers in the final three matches (#6/#7/#8) each score a point.


The people that show up higher on the "top of the card" list but much lower (or not at all) on the World Champ list are:
  • Bobby Eaton
  • Terry Gordy
  • Stan Hansen
  • Bob Armstrong
  • Robert Gibson
  • Butch Reed
  • Dick Murdoch
  • Buddy Roberts
  • Roddy Piper
  • Barbarian
  • Dustin Rhodes
 People that are higher on the "World Champ" list but not as high on the overall "top of the card" list were:
  • Vader
  • Mongolian Stomper
  • Baron Von Raschke
  • Great Muta
  • Ken Patera
  • Leroy Brown
  • Spoiler

Saturday, March 01, 2014

Wrestlers who were in the ring with the World Champion (MSG)

Dave Meltzer, on the F4W/WO message board wrote:
You know what would be a project: Who had the most main events over a career combining --
  1. PPVs (every group that had them although you could argue TNA & ECW were never really major league at that level)
  2. MSG house shows (prior to monthly PPVs when MSG house shows were the second biggest priority)
  3. Atlanta Omni main events (until WCW went monthly)
  4. Greensboro Coliseum main events (until 1988)
  5. St. Louis main events (until 1985)
  6. Chicago main events (until 1985)
  7. Los Angeles main events (until 1975)
  8. SF Cow Palace main events (1961-76)
  9. Minneapolis main events (until 1985)
  10. Toronto main events (until 1984)
  11. Montreal main events (until International closed)
  12. Japanese Dome & Stadium shows
  13. Sumo Hall, Budokan Hall, Osaka Furitsu Gym/Castle Hall (or Nagoya Aiichi Gym or both)
  14. Dallas Reunion Arena (during its era)
  15. Houston (until 1986)
  16. New Orleans Superdome
I looked at prolific WWE & WCW PPV performers in my latest WhatCulture article.
I don't have results for all of these arenas listed, but there is information on The History of WWE concerning MSG shows from 1963-2013.  [1960s, 1970s, 1980s, 1990s, 2000s, 2010s]

Main Events is always a tricky term.  Is it the last match? Is it the match that had the world champion involved?  I look at 1963-1995 and normalized names.

Let's start with who was in the matches that included the World Champion:






Another method of scoring "main events" is looking at people who were in the top quarter of the card.  Basically, I'll give a wrestler a point whenever they're in the final matches.  For instance, on an 8 match card, the wrestlers in the final three matches (#6/#7/#8) each score a point.


Longer version of the List.

The people that show up higher on the "top of the card" list but much lower (or not at all) on the World Champ list are:
  • Tony Garea
  • Bobo Brazil
  • Ivan Putski
  • Mr Fuji
  • Tito Santana
  • Haystacks Calhoun
  • Dominic DeNucci
  • Tony Atlas
  • Afa
  • Davey Boy Smith
  • Rick Martel
  • Rocky Johnson
  • Dino Bravo
  • Haku
  • Junkyard Dog
A lot of these wrestlers are tag team guys.

People that are higher on the "World Champ" list but not as high on the overall "top of the card" list were:
  • Don Muraco
  • Freddie Blassie
  • Harley Race
  • Stan Hansen
  • Paul Orndorff
  • Sheik
  • Kevin Nash
  • Buddy Rogers
  • Bobby Duncum
  • Lex Luger
  • King Curtis Iaukea
  • Bruiser Brody
  • Johnny Valentine
  • Gene Kiniski
Certainly some heavy hitter in there, but some of these weren't longer term WWWF/WWF guys.