As the title says can WWE go under/bankrupt. TLDR version theoretically yes, very unlikely in the short term.
So WWE financials are in and they have had their best year ever. This is due to things like the FOX TV rights to Smackdown and Saudi blood money.
To put things in perspective AEW has not started yet and NJPW is less than 1/10th the size of WWE. Yes WWE can theoretically go bankrupt but in the short term this is not really possible no matter how bad the programming gets. This is because of TV rights which make them way more money than gate sales and attendance figures.
And yet VInce is now suddenly concerned about TV ratings. Presumably the reason may be AEW which may sign some sort of TV deal, a big threat would be if it gets on Netflix and people watch it.
However this can also be be inferred from something else that is going on. Something that AEW (at least by itself can't do). FOX may have inked a 1 billion dollar 5 year contract but apparently they expect WWE to bring the ratings up by 50% when Smackdown moves to FOX.
This move in theory should be very easy, more homes have access to FOX than USA Today. And if even a fraction of ex fans returns Smackdown will be out performing RAW.
However FOX may also have a get out clause. Put simply the $200 million a year deal they signed may be conditional on those ratings going up. I would imagine that they do not expect miracles overnight such as a 50% boost in the 1st month but in the 1st year would seem to be a likely reference point. In effect this is like a 1st season and the odds of it getting a second.
This means Smackdown could get cancelled along with that $200 million dollar deal. RAW is also going to be coming up for renewal. If True Smackdown won;t be under threat of being cancelled until around the end of 2020, RAW might get a similar deal or a smaller deal where rating don't matter.
And this is where AEW comes in. AEW doesn't have to beat WWE in the ratings but WWE fans seem to know about it and things outside the WWE bubble. See the Bullet Club and AEW T shirts in the crowds at WWE events. WWE seems to enjoy trolling the fans who have responded by not watching the product.
So imagine being in WWEs shoes with a new company that doesn't even need to attract a large share of your audience to potentially tank your company. If a certain % of fans and potential fans (maybe a million) watch AEW that is enough to make something like Smackdown fail to meet those targets that FOX may or may not have included. Even if they do not have those goals in the contract in 5 years times if current trends continue the viewers will get smaller and will FOX (or anyone else) want to pay $200 million dollars for something with sub 2 million viewers. THats Game of Thrones level of money without the tie in Game of Thrones income and merch.
If AEW ends up on free TV or Netflix I'll watch it. Can't be any worse than early 205 live and I watched that. And I doubt I am the only one. Even ow you have he choice of general buffoonery sports entertainment on RAW and more work rate centric Smackdown and NXT to chose from. Unlike WCW AEW does't need to beat WWE, they just need to make a decent product and gum up the works for WWEs targets which could potentially get them cancelled., and things like the Network do not generate enough income to cover a $200 million dollar hole in WWE finances.
In a worst case scenario WWE can also cut out things that lose them money such as their films and NXT. And that is the danger AEW/WWE ratings slide presents and VIne wants to do his XFL thing so he need to hand some things off to others or try and run both companies which he didn't really want to do from the sounds of it but things have changed since his XFL announcement.
So WWE financials are in and they have had their best year ever. This is due to things like the FOX TV rights to Smackdown and Saudi blood money.
To put things in perspective AEW has not started yet and NJPW is less than 1/10th the size of WWE. Yes WWE can theoretically go bankrupt but in the short term this is not really possible no matter how bad the programming gets. This is because of TV rights which make them way more money than gate sales and attendance figures.
And yet VInce is now suddenly concerned about TV ratings. Presumably the reason may be AEW which may sign some sort of TV deal, a big threat would be if it gets on Netflix and people watch it.
However this can also be be inferred from something else that is going on. Something that AEW (at least by itself can't do). FOX may have inked a 1 billion dollar 5 year contract but apparently they expect WWE to bring the ratings up by 50% when Smackdown moves to FOX.
This move in theory should be very easy, more homes have access to FOX than USA Today. And if even a fraction of ex fans returns Smackdown will be out performing RAW.
However FOX may also have a get out clause. Put simply the $200 million a year deal they signed may be conditional on those ratings going up. I would imagine that they do not expect miracles overnight such as a 50% boost in the 1st month but in the 1st year would seem to be a likely reference point. In effect this is like a 1st season and the odds of it getting a second.
This means Smackdown could get cancelled along with that $200 million dollar deal. RAW is also going to be coming up for renewal. If True Smackdown won;t be under threat of being cancelled until around the end of 2020, RAW might get a similar deal or a smaller deal where rating don't matter.
And this is where AEW comes in. AEW doesn't have to beat WWE in the ratings but WWE fans seem to know about it and things outside the WWE bubble. See the Bullet Club and AEW T shirts in the crowds at WWE events. WWE seems to enjoy trolling the fans who have responded by not watching the product.
So imagine being in WWEs shoes with a new company that doesn't even need to attract a large share of your audience to potentially tank your company. If a certain % of fans and potential fans (maybe a million) watch AEW that is enough to make something like Smackdown fail to meet those targets that FOX may or may not have included. Even if they do not have those goals in the contract in 5 years times if current trends continue the viewers will get smaller and will FOX (or anyone else) want to pay $200 million dollars for something with sub 2 million viewers. THats Game of Thrones level of money without the tie in Game of Thrones income and merch.
If AEW ends up on free TV or Netflix I'll watch it. Can't be any worse than early 205 live and I watched that. And I doubt I am the only one. Even ow you have he choice of general buffoonery sports entertainment on RAW and more work rate centric Smackdown and NXT to chose from. Unlike WCW AEW does't need to beat WWE, they just need to make a decent product and gum up the works for WWEs targets which could potentially get them cancelled., and things like the Network do not generate enough income to cover a $200 million dollar hole in WWE finances.
In a worst case scenario WWE can also cut out things that lose them money such as their films and NXT. And that is the danger AEW/WWE ratings slide presents and VIne wants to do his XFL thing so he need to hand some things off to others or try and run both companies which he didn't really want to do from the sounds of it but things have changed since his XFL announcement.
