Dave Scherer of PWInsider is reporting that in the most recent investors conference call, WWE were asked about the status of their contract negotiations with NBC Universal as the current contract expires in 2019.
WWE declined to answer, which Scherer explains is a good thing as Vince McMahon previously said when they signed the previous contract that they predict to double viewers and the product isn’t ‘DVRable,’ meaning that consumers won’t record it to watch later and would rather watch live. This obviously isn’t the case, with record low viewership for both ‘Raw‘ and ‘Smackdown Live.’
The highest offer, it would seem, for WWE during the last round of negotiations was by NBC Universal, but wasn’t as high as what McMahon wanted. Now with lesser viewers, there doesn’t appear to be any way they would accept higher. It is likely, Scherer explains, that NBC Universal may not renew their contract.
This would leave the company with little options, as the cable industry is cut-throat and changes frequently. Nowadays’, people would rather watch ‘Netflix’ or ‘Hulu Plus’ as opposed to regular cable. Cord cutting is also a huge issue now, which affects the amount WWE receives.
Scherer explains that there may be two possible solutions he could consider for the company to do, if negotiations don’t go to plan with NBC Universal. They are either to accept a contract for a much lower amount or add ‘Raw’ and ‘Smackdown Live’ to the WWE Network and create a tiered system for it. Both options would significantly decrease the revenue for WWE, with the cable shows being their highest source of revenue.
“For the sake of comparison the 5/12/14 Raw, which was the show before WWE announced that new deal in 2014, did 4,006,000 overnight viewers. By contrast, the second May Raw of 2017 did overnight 2,696,000 viewers. For you math types, that is a drop of 33% of people watching Raw.”
It appears the only way this could swing in WWE’s favor is to overhaul their whole system and create new, interesting content in a way to potentially draw in more viewers. Without this, things will seemingly get worse. Scherer leaves the article with some ominous words.
“To me, the best way to not have to make the decision as to which fork in the road that you have to take is to make sure you never have to make the decision. The company still has time to bail water from the ship to keep it from going down. It would require a commitment to changing up the predictable way that they do business immediately. If they want to avoid coming to that unwanted fork, the time to make changes is now. If they don’t, this time in 2019 could be really scary for them.”
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This is awful… I wouldn’t want to see anything happen to the company. My guess is they are hard at work deciding what to do next about the contract situation, because it was recently noted that the creative team didn’t have plans. Maybe that is what they are focused on. I just know WWE need to get everything together, because this is big… Before anyone says to cut the three hours to increase viewership, you’ll complain when your favorites don’t get on television because of the limited time they would have with the biggest roster they’ve ever had. Perhaps they could even go to two hours and create a third main show to distribute the stars more…but that may be too much.
What are your personal thoughts on this situation? What should WWE do? Comment down below and let us know, or check out our Facebook page or Twitter account. You can find and follow me, if you so desire, at @SOSNH1995 on Twitter.