Welcome, one and all, to the glorious debut of the Rajah Debates! For years, the best and brightest minds of the Rajah forum have done battle with words about a myriad of fascinating topics from the wrestling world, seeking to answer the questions that plague the wrestling community. Is John Cena actually a good wrestler? What's the greatest wrestling show of all time? Is anyone as good as Bobby Lashley? (No.) But for the first time ever, we're bringing the debates to you and letting you guys act as judge, jury and executioner.
The way this works is simple. Each match will involve a maximum of 3 250 word posts from each participant going in order. At the end, you guys and our panel of judges will vote to see you moves on to the next round to get one step closer to Rajah immortality. Over the course of the next month you'll grow to know and root for these brilliant weirdos until we eventually crown a grand champion.
Your part comes in at the end where I have a poll posted for you to vote on the winner. If you'd like to see the trash talk going on behind the scenes, or jump in to let these brave bastards know what you think of the debate, just to join us in the rajah forums. If you sign up and join the chat, you are automatically in the running to participate next year!
Sound good? I thought so! So let's jump right in!
WWE is the king of the wrestling industry. An unstoppable money making juggernaut that rules the entire industry with an iron fist and has made itself synonymous with the concept of professional wrestling itself. It's nearly impossible to imagine how it could ever fall apart to the point where the promotion would have to close it's doors, but it's your job to be the predictor of doom. So look at everything from the product to the business model to the financial forecast for the future and tell me...
The coin toss dictates that kangus will go first.
Ensuring the WWE remains a prominent, successful, and probably most importantly a profitable business annually is no small feat, to put it mildly. There are budgets to be made and adhered to. There are travel concerns, arena concerns and talent concerns. TV deals to made and even an entire WWE Universe to consider! Now If any of these departments and others are not managed correctly then the entire operation could be comprised.
However, there is nothing more important and crucial to the WWE`s bottom line than the WWE Network. Launched in 2014 and now with an estimated 1.63 million paid subscribers and a significant contributor to the company`s quarterly profit margins, the WWE Network is not merely only a proverbial cog in the WWE`s financial wheel; it`s a material lifeline that keeps the business afloat. But what the WWE Network provides goes beyond dollars and profit. With the ability to be accessed by any mobile platform combined with the millennial generation`s willingness to accept and pay for a subscription based service that provides content; the WWE Network has forged a place in the consumer landscape whose impact cannot easily be overstated.
Therefore, a deterioration of this service as a result of a critical loss of subscribers would be nothing short of catastrophic for the WWE. Simply put, if someone were to say in five years the WWE would no longer be in business, it could be expected that the primary cause the downfall was the failure of the WWE Network.
While the WWE is undoubtedly recording record high revenues from multiple avenues, there are areas of the company losing money while other areas are profiting money for the company.
The WWE continues to profit from their television reach not only in North America, but also in countries such as India, Middle East and Asian markets. Television helps drive sponsors and viewership, which in return drives profit. The WWE’s 2017 Q2 television profits were $30.8 million. These profits are nearly $8 million higher than their next largest generator, which is live events. Television profits help to offset corporate expenses and depreciation from other areas of the company, and allow for continued investment in areas such as Network, social media and globalization. The WWE recently launched two Live TV shows in India and Middle East, completing a deal with African based broadcaster SuperSport.
That said, ratings have dropped anywhere from 4%-9% each year, while cable TV is projecting only a 1.5% decrease in subscribers year-over-year for the next 10 years. Is this number alarming, yes, but nowhere near the disproportionate drop in viewership in WWE programming since 2009.
Why do I mention this, you ask? Simple. In order to sustain profits and grow investments, while supporting sponsorship, the WWE must find a way to succeed in the ever-changing cable TV market or they will falter. Companies invested 9.25B in TV advertising in 2016. Companies want to invest in growing markets like the NFL and NBA, not a declining television show.
I begin by noting that my opponent made one of the most egregious errors one can make in a debate and that is he failed to answer the question. He presented an overview regarding television ratings and why they are important to WWE but did not explicitly link this to the question at hand. Nonetheless, I move onward.
Treating WWE TV programming as trivial would be a mistake and a serious miscalculation. But how can it be believed that further degradation of an already damaged property, as my opponent admits, would be the most likely cause of WWE`s complete demise? Television has become a compromised medium and as Netflix, Amazon, WWE Network and Hulu among many others have successfully proven is that it's possible to transfer or create weekly episodic programming, and other forms of viewer content, on a platform other than traditional television.
On the other hand, the elimination of the WWE Network would be a critical blow to the WWE. It would unequivocally be a logistical and consumer nightmare. Programming generated by the network would be gone and it would be almost impossible, not to mention highly irresponsible, to transfer that content onto a antiquated medium such as television. WrestleMania and all of other events would by necessity become PPV's again. How are you going you convince consumers who have been conditioned by nominal subscription fees to fork over $49.95 or more for events when that model was barely viable before the WWE Network was even an option?
I answered the question. Losing television deals and share would hurt this business much more than the Network failing. The WWE relies on their weekly television shows to bring in new viewers while driving profit through sponsorships. They utilize these profits to offset loses created by corporate expenses and future investments, including the WWE Network. The Network will never bring in a new viewer, and with a paid subscription it's difficult to drive revenue through sponsorships while adhering to a no-commercial platform. And admitting that television is potentially declining is not admitting you're right, it further proves my point that 5 years from now if TV is in a steeper decline, the WWE may directly see a negative effect, losing potential sponsors, profit and growth. WWE does not rely on the network to survive, but they do rely on television deals and ratings to drive profits in order to maintain a profitable company.
Again, I never said cancel the network. I answered the question by stating that without television deals and live viewership via cable TV, there may not be a company profitable enough to support a $9.99 network.
A profitable company? This is about survival and that's it. I'm certainly not disputing the amount the revenue WWE TV programming brings in. But the question is 'if WWE were to close in the next 5 years, what would be the most likely cause?' If someone were to say that in five years the WWE wouldn't have a TV deal anymore, obviously they would be operating in a diminished capacity BUT operating nonetheless. As I've explained, consuming content in a variety of ways on a variety of online platforms has never been made easier today, much less five years from now. My opponent wonders about a $9.99 online subscription model but that overlooks revenue generated from other sources within the company. Additionally, if the TV deal were to fall through, guess what? That subscription fee probably would be raised from $9.99 to a number palatable to a consumer base that does not rely on TV like it's 1995. Let's be honest, If WWE were to lose their TV agreements the company would undoubtedly suffer but it would have options which would allow prolonged sustainability.
Now what if WWE were to lose the Network? How are they going to reach their most important demographic, a demographic that consumes online content like no other generation before them? How are they going to compete in a world that's becoming more sophisticated and competitive with the breadth and scope of online content on a daily basis? How are they going to survive?
How will they survive without the Network? The same way they have for 25+ years, by marketing, live events and sponsorships via TV. The Network is like dessert after dinner, you don't need it to survive, but it's nice to offer it to your fan base. Sure, you can survive without dessert, but can you survive with the steak dinner?
Television continues to drive new viewers. A new fan to the business is not going to push out $10 a month to sample the product in hopes of catching on, but they will stop flipping channels to watch Raw or SD!.
I think you also underestimate cable TV. There are currently still 92.1 million cable tv subscribers in this country. 92.1 million. Can the WWE sustain losing 92.1 million potential viewers? Plus, with a goal of international globalization, cable tv success is as important as ever. As mentioned in my first post, the WWE has launched live shows on cable based networks in India, Middle East and Africa, where cable TV is thriving. They can't afford to lose the profits and potential reach of new business and new consumers.
The Network is a delicacy, not a necessity. You mention thriving in an age of online consumption, well, there are many ways to consume information online and via social networks, and the network is not the end all be all solution, itut it's a fine treat.