The WWE/Endeavour Merger has already seen some big changes within the company.
Backstage staff, office workers and even talent have been released from WWE in cost-cutting
measures, but there are still costs to be cut.
But, are these changes actually a positive for both WWE, and for fans?
On December 5th, 2023, WWE Home Video announced that it will no longer be producing home video
releases.
They posted on Twitter, “With great sadness we must announce that WWE have taken the decision
to withdraw from the Home Video category.
No licensing deals will be renewed worldwide after 2023”.
This promoted a slew of nostalgic tweets from wrestling fans, with many telling stories
of home video releases - be they DVD or VHS - were part of the fabric of their wrestling
DNA.
They might not be fans without them.
Anecdotally, this was my first experience of wrestling back in the early 90s [BATTLE
ROYAL VHS] I wasn’t allowed to watch wrestling in my
household as my mother thought I would reenact it and get seriously hurt.
Jokes on her, though, because when wrestling was put on Channel 4 for free in 2000 I really
got into wrestling and started doing backyard wrestling and got hurt!
Wait.
But this VHS was the only thing I’d seen of wrestling for the longest time.
And when I did get into wrestling in 2000 thanks to Sunday Night Heat being shown on
Channel 4, I found a new friend at school who had loads of WWE PPVs on video, and we
spent our teenage weekends watching them.
He also had videos of ECW and WCW, which is how I discovered those too.
However, I am an elder millennial.
Of course I discovered an interest through video, that’s what we all did.
And a lot of the wrestling fans romanticizing about the death of physical media for rasslin’
would also be those millennials and older, because that’s their nostalgia.
Gen Xers don’t even know what a VHS is.
And a lot of them will have discovered wrestling through other means, and then got their wrestling
histories from a much easier source to see all of the wrestling you want: The WWE Network.
The last physical releases of WWE PPvs will be Survivor Series 2023 in the US, and Crown
Jewel 2023 in the UK.
Haus of Wrestling reached out to their WWE sources about the news, and they told them:
“The home video business has long been in decline, and it will no longer be a place
where the company dedicates time and resources.”
This isn’t actually the first time WWE have cancelled home video releases of their PPVs,
as they announced in 2022 they wouldn’t be releasing DVDs and Blu-Rays of PPVs.
However, they made a last minute decision to continue for two more years.
WrestlingINC reached out to their sources to ask if something similar would happen this
time and they write, “it doesn't appear another last-minute change is in the cards.”
WWE are not the only ones to stop doing physical media of their shows.
Disney announced in August of 2023 that they were no longer going to make DVDs and Blu-Rays
of their movies in Australia and New Zealand after the release of Guardians of the Galaxy
Vol. 3.
Forbes wrote, “While consumers will be able to buy discs currently in stock, no new shipments
from Disney’s vast content library, including Star Wars, Marvel Studios and its animated
classics will be forthcoming.”
They’d already stopped making physical media in Latin America and select Asian markets.
Forbes continued, “Disney cites declining sales as the reason.”
The decline of physical media - DVDs, Blu-Rays, UHDs, etc - has been a long-running topic
in the world of entertainment.
The Digital Entertainment Group reported that DVD and Blu-Ray sales in the US had dropped
from $1.97 billion in 2021 to $1.58 billion in 2022, a decline of 20%.
That decline has continued, with the same group reporting the first half of 2023’s
sales is $753 million, a drop of 17% from the same period of time year on year.
If that number doubles for the second half, that would still be under the total sales
in 2022.
Rentals had also declined.
On the other hand, streaming revenue is massively up.
The first half of 2023, according to Digital Entertainment Group, is 17% up year on year
- around $19 billion.
What is old might become new again - just look at the rise of popularity with vinyl
in the last couple of years - but the numbers for DVDs and Blu-Rays don’t lie, and they
spell disaster for physical media and Sacrifice.
And it’s not just the physical media market that WWE are changing under TKO.
Speaking at the UBS Media Conference on the 4th of December 2023, TKO COO Mark Shaprio
said of WWE’s house shows: “While there's a reason to have them because it's good for
the brand, we're building audience, we're putting them on in C and D counties, so we're
really stretching the brand, and we're kind of amassing a greater array of eyeballs from
all demos, so it's good for our long-term growth.
From a margin perspective, they are dilutive.”
House Shows, or WWE Live as they’re also known [THEY’VE REBADGED IT YOU FOOL], are
the live shows that happen in between the TV tapings.
These are untelevised events, and are used as part of advertising the WWE brand.
On very rare occasions, something big will happen at them - there was a period in 2017
where Kevin Owens and AJ Styles swapped the United States Championship between them, although
a lot of that was by accident - but most of the time they’re just used to let fans see
wrestlers they like.
For example, Omos has not had a match on WWE TV or PPV since Summerslam, but wrestles regularly
on house shows.
Sometimes house shows can be used to trial out new gimmicks or new feuds before they
debut on TV.
Agents also provide feedback about the wrestlers to higher ups about performance which often
dictates who is getting pushed next.
The other thing that house shows provide is - to be blunt about it - fun for the wrestlers
themselves.
House shows don’t have the same time constraints as TV.
You don’t need to hit commercial cues, you don’t need to work cameras.
You can just wrestle.
You can experiment with new things.
For example, The People’s Elbow - one of the most famous finishing moves in all of
wrestling history - was born at house shows.
It was just a move that The Rock did to make the other wrestlers laugh, particularly The
Undertaker.
But it got over at the house shows, so Rock started doing it on TV.
Dave Meltzer also notes in the December 11th,Wrestling Observer Newsletter, wrestlers who came up
on the independent scene - which is most of the WWE roster at this point - cut their teeth
in front of live audiences with no TV pressures and thrive in these environments.
Again, speaking anecdotally, as a fan I’ve had a lot more fun at WWE house shows than
I have TV tapings.
So, the question is, why cut them?
One could point toward injuries and the general wear and tear of wrestler’s bodies as to
why you’d want to scale back on doing house shows.
However, while writing about the decline of WWE’s house shows in the December 11th Wrestling
Observer Newsletter, Dave Meltzer noted that, “current data really doesn’t answer the
question as to overall safety”.
He looked into the injuries list of both AEW and WWE - one which does house shows and one
which does not - and found out, “Of the 142 wrestlers currently active in AEW, 12
are currently injured or 8.5 percent.
In WWE, there are 15 out of 169 or 8.9 percent.”
Charlotte Flair, for example, didn’t get injured on the three house shows she wrestled
leading up to the Tribute to the Troops episode of SmackDown, she got injured at that TV taping.
Fightful Select reported that the injury during the match with Asuka was real, “She had
to be helped to the back and appeared to be in pain.”
So if it’s not for wrestler’s safety, then what is it?
If you’ve been watching this video for long enough, you’ll probably already know the
answer.
The finger thing means money.
Wrestlenomics reported via Patreon that WWE will run 206 shows in 2023, and notes only
about 23 of them are in the C and D counties that Mark Shaprio was talking about.
That’s only 12% of the company’s current schedule.
Which, doesn’t sound like a lot.
But Wrestlenomics also note, “In a few quarters before the pandemic, WWE reported operating
losses in its live event division, meaning the division overall was unprofitable for
those periods.”
Speaking of 12%, that’s also the amount of revenue house shows brought into WWE between
July 2022 to June 2023.
TV rights, on the other hand, brought in 79% of revenue.
In his speech at the UBS Media Conference, Shaprio noted that the deal WWE has with Saudi
Arabia is worth over $100 million per year.
That’s for just two shows.
So, yeah, why would you spend money on 23 shows that you’re not making money on, when
you can do just two shows in Saudi Arabia for way more money?
They’re not doing this for fans, they’re doing this for cash.
And more changes are still to come.
One of the things that TKO have been quite vocal about since the merger is sponsorships.
Now I know what you might be thinking?
Aren’t there already a lot of sponsorships on WWE TV?
We have brand integration all over the show - the women’s War Games match was sponsored
by crisps!
Or, chips for our American viewers.
Shaprio noted at the conference that Vince McMahon used to see a wrestling ring like
a religion.
He wanted it clean.
The mat was clean, the ropes were clean.
And not of dirt, but of sponsorships.
Under TKO, that will change.
Shaprio argues that sponsors don’t just want a banner up in the building - which is
what WWE previously did - they want ‘activation’, and that means sponsorships on the mats and
on the ropes.
When talking about UFC he said, “Until we get over $1 billion in sponsorship, I won't
be happy.”
The same will apply to WWE.
And while it’s just C and D counties that are being cut for house shows, more will be
if they also don’t perform.
Which brings us to the weekly TV product.
While they make money - 79% of WWE’s revenue is from TV rights - that’s for the show,
not the look of the show or how it’s made.
In fact, I’ll just give you all of Shaprio’s quote so you get an idea of what he thinks:
“Just think of how many events we televise, we put on.
We bring the show on the road.
We bring trucks out to different cities, whether it's a cloud or it's cameras or it's tape
machines, replay, graphics, operators, stuff we can do AI back at our headquarters.
In either Vegas for UFC or our Stamford production facility for the WWE, there are a lot of production
efficiencies.
Even if our production chiefs want to tell me there's not, frankly, I worked at ESPN
for 12 years, I oversaw all production, I've been through all the song and dance with every
producer who, treats every tape machine and camera like it's a baby and doesn't want to
give it up and we're here to improve our margins..
So we are going to scrutinize every dollar on the production end of every single one
of these events and every single one of these telecasts.
And we're going to realize substantial savings.”
The TKO merger is still new, but one thing is for sure, WWE in 2024 might not look the
same as it did in 2023.
And we could see a returning face in all of that if reports are to be believed.
Check out my deep dive WrestleTalk News about the potential WWE return of Sasha Banks.
Click the video on screen right now to find out more.