There was a good amount of news out today in regards to WWE's financial situation, so I thought it'd be best to split it off into a separate post. I think I'll make that the norm for when something this big goes down, so it doesn't get all mixed up with everything else.
Read on for the news and my take on it.
Vince McMahon specifically mentioned that they're focusing on getting new talent over. He says that things oculd be turning around post-Royal Rumble and WrestleMania. He named The Miz, Randy Orton, and Alberto Del Rio as characters that are catching on really well.
International expansion is another point that he's proud of, signing new TV deals in Brazil and Russia and running their first show in China. I think expanding internationally could be key for WWE going forward. They haven't seen enough for the show or talents to be stale to them. They're also moving into different domestic markets.
Declines in retail have been the issue with selling their DVDs and the like, where they experienced a 44% drop from the previous year. Having less over talent was cited as the reason that live event sales are dropping.
PPV buys are noticeably down (15%). Survivor Series was the only PPV to do better in 2010 than 2009. TLC wasn't too far off, but Hell in a Cell and Bragging Rights took big hits. The increased prices helped offset the losses slightly, but this is a BIG area they can improve on. They need to make PPVs more important, saving the big title and grudge/gimmick matches for here. And importantly, they need to make those gimmick matches MEAN something. Raw vs. Smackdown really isn't that big of a rivalry when we see them face off so much. Likewise, Hell in a Cell is something that should end big feuds. A drop in price would also be very welcome to improve buys and revenue.
The deals with Mattel and SyFy have born fruit, as toys and TV revenue have increased. There's been an overall drop in video game sells though, which has been common to the industry. Smackdown vs. Raw was down 35%, but WWE All-Stars will help numbers this year.
WWE Films is seen as something that will bring in money over time with the direct-to-DVD releases. The latest releases have not done well at all, losing money for the company.
They will likely have the same number of live events going forward, with more of them being international. There could be more overall. The stress of doing international events on the talent is something to consider here. Domestic live event attendance is down 15%, and international event attendance is down 11%.
There are still negotiations and meetings for the WWE Network. This will also be pretty interesting to watch going forward. It could turn out well for them. McMahon said that "early indications are that it's a great idea".
The last question was about celebrities. When they are used, it will be on a more selective basis and will be bigger names. Having them every week took focus away from their own talent.
There's been a major drop in "cash on hand" due to the costs of WWE Studios film shoots, taxes paid in cash, and not having the one-time $13 million cash receipt from a business partner that they had in 2009. They went from $116.4 million to $38.6 million year-end 2010. Hopefully that money's been well-invested!
All in all, a mixed bag. They seem to have some solutions to fix some problems, but there are still some things I think they can improve upon. Either way, things aren't going to improve overnight. I won't predict any kind of timetable, but I think it will definitely take more than a few months to see any lasting positive change. Business certainly isn't in the gutter, but it could certainly benefit from a nice shot in the arm.
That's all for this look at WWE's business. More routine news is to be expected tomorrow.
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