10/6/15 – Andrew Berg – @WrestleRosters
If wrestling reporters are to be believed, WWE is very concerned with its sinking TV ratings. The 9/28 Raw drew about 3.3 million viewers, which seems like a large number until you consider that it’s the lowest total to watch Raw in about 18 years. Message boards have come to life with rumors about Vince McMahon seizing control of the creative process or John Cena returning to the top of the card as a proven draw. Maybe the panic at Titan Towers is real, maybe it’s not. But one thing that’s clear is that WWE’s actions indicate the company does not care if fans watch TV every week.
WWE TV Airs on an Endless Loop
Between Raw and Smackdown, WWE airs five hours of new, original programming on nationwide TV every week. That amount is unprecedented in the wrestling business. When fans talk about the Golden Age of wrestling brought on by the likes of Lucha Underground, NXT, New Japan, and Ring of Honor, they’re comparing shows that air one hour of new content per week (and not always every week). The total airtime for these promotions amounts to 20% of what WWE puts on each week. If WWE simply skimmed the top 20% of Raw and Smackdown and condensed it into a one hour show (or even a two hour show, as in the peak period of the Attitude Era), there’s no doubt that WWE would have the most impressive, entertaining programming on TV.
Instead, fans have to sit through five hours of TV to get what might amount to two hours of entertainment every week. Producers cut Hollywood blockbusters under three hours because hundred-million dollar spectacles can’t hold viewers’ attention for that long, yet Raw goes into an overrun segment at the end of every Monday episode. No wrestling promotion has ever attempted to fill five hours per week with new programming, let alone additional PPVs, network specials, and non-wrestling original programming. If the experiment is going to work, it is natural that there would be growing pains in the early stages.
WWE uses obvious crutches to fill its shows every week that demonstrate those growing pains. The lengthy promos to kick off episodes, the redundant in-show recaps of things that happened the same night or week, and the recycled matches that pit the same wrestlers against each other several times in a week are all ways to meet production standards, but none contribute to the best possible product.
Seth Rollins is the WWE Champion and is supposed to feel like a special attraction, yet it’s common to see him wrestle for free two or even three times in a week. When fans complain about seeing Neville and Stardust or The Wyatts and Roman Reigns wrestle for the millionth time, it’s fair to guess that the creative team does not believe that they are telling the stories in the most compelling ways, but that they have no other way to make five hours of new wrestling every week with the resources at hand.
If You Missed It the First Time, You’ll Get Another Chance
Even if someone wanted to watch all five hours of WWE TV every week, there would be little incentive to do it all in real time. Forget DVR technology; WWE replays highlights of its most important moments endlessly on subsequent TV shows, makes the bulk of Raw available on Hulu the next day, and even posts YouTube clips that capture the majority of what anyone would want to see with a fraction of the time commitment.
It was popular to say that WWE was going reap a financial windfall when it negotiated its new TV contract last year. The premise was that TV networks pay top dollar for sports or reality competitions because viewers are more likely to tune in live. The theory goes that advertisers will pay more for a captive audience that wants to view in real time because they don’t want to risk spoilers or they want to participate in the live conversation on social media.
Of course, the TV deal was not a windfall and WWE’s ratings have continued to erode ever since. With so many ways to watch WWE TV other than tuning in live, NBC Universal correctly surmised that it would not become the same kind of appointment viewing as professional sports or a reality competition. Even if fans get tipped off to something that happened on the show, a good match is still entertaining to watch and an exciting segment will still be worthwhile a day later.
If It Really Mattered, It Would Be On the Network
The idea of avoiding spoilers brings us to the most fundamental change in WWE’s business model- the birth of WWE Network a year and a half ago. WWE recognized that they would create a more profitable business model by monetizing a larger portion of its fan base. Rather than going all out to sell the occasional PPV, the company determined that it could get enough fans to subscribe year-round to the WWE Network for roughly the cost of two PPVs per year. If WWE’s subscription numbers are true, then the experiment has already been a profitable one.
The way WWE has created value in the Network is by shifting some of the must-see TV onto its proprietary platform instead. Since the launch of the Network, the WWE Title has not changed hands on free TV. Neither Brock Lesnar nor the Undertaker- arguably the company’s two biggest special attractions- has wrestled a match on free TV. WWE has gone so far as to create non-PPV Network Specials- Beast in the East and the recent MSG show- to showcase Lesnar, Chris Jericho, and NXT Title matches off of free TV. If WWE was serious about TV ratings, it would create meaningful stakes on free TV. It would expand its roster so the same wrestlers would not wrestle so many times every week. It would create more divisions or titles (like a Cruiserweight or TV Title) specifically designed to create the potential for real development or finality on free TV. WWE doesn’t do any of these obvious things because the free TV is not an essential part of its current business model.
In essence, WWE has adopted a Freemium business model. Freemium is a term for software or an app that allows a user to access part of its functionality for free, but requires payment to unlock the full capacity. The trick is that the free portion works as an advertisement for the full version under the assumption that the product will sell itself once a user gets a taste of it. As presently constituted WWE works in essentially the same way. Free TV is a sample and an advertisement for the Network. While WWE used to sell PPVs that went hand in hand with the free product, the Network- with exclusive programming and the entire NXT brand- is less aligned with the free product.
And that’s why WWE’s goal has little to do with attracting viewers to its free TV shows. If the ratings go down, that means that fewer eyeballs are receiving advertisements for the Network, but it does not have a direct financial impact on the company. WWE is only a year into a long-term TV contract that isn’t going anywhere for many years. To generate additional revenue, WWE has to drum up more subscribers to the Network, so the company is strongly motivated to keep its programming exciting on that platform.
To that end, filling five hours of TV programming is a secondary concern. The creative team certainly recognizes that having that much airtime does not translate to the optimal entertainment level, but the purpose of the free TV is not to stand alone as entertaining. The purpose is to showcase what fans can get by paying $9.99 a month for the Network. As long as the TV programs serve that purpose, the ratings are not a crucial issue.