AOL/Time Warner Merger: The Last Nail in WCW's Coffin

Discussion in 'Old School Wrestling' started by SSJPhenom, Aug 14, 2017.

  1. SSJPhenom

    SSJPhenom The Phenom of WZ

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    Over the past month I've tried to take us on a journey of reflection. Reflection on what I feel caused WCW to go out of business. I've discussed PPV's, people, events, and different circumstances that I believe all lead to WCW's demise. I'd be remiss in my duty, however, if I didn't discuss one of the most over touted and downright misconceptions of WCW's demise. The AOL/Time Warner merger.

    I'm not going to spend a lot of time on this because it's simple for me. The AOL/Time Warner merger did not kill WCW. Did it have something to do with WCW's sell? Yes it did. Was it the sole reason that WCW was sold? No it wasn't. Eric Bischoff can say all he wants that It was the merger that killed WCW and that Jamie Kellner was the one that pulled the trigger and part of that's true. Jamie Kellner is the one that decided that WCW should no longer be on Turner's broadcasting. I think it's important, though, to understand why the man made that decision.

    It's well documented that the people that were in charger of the company after the merger didn't like nor did they know what professional wrestling was. So knowing that information it's very easy for fans to think that they just wanted to get rid of it. Do you know what they did like and what they did know, though? Money and profit! Which was something that WCW didn't have and wasn't making at the time the decision was made to get rid of it. How anyone in their right mind can tell me that Jamie Kellner would have still decided to get rid of WCW were it continuing to make the kind of money it did in '96, '97, and '98; I'll never understand. WCW went from making anywhere from 80-150 million dollars a year in profit those 3 years. Let me stop for a second and explain what the word profit means. It means that after all of WCW's production costs, salaries they had to pay, materials they had to buy, etc they were 80-150 millon dollars to the good. Now think about how much those production costs, salaries, and what not actually cost. That means, in actuality, WCW was probably making over 500 million in those years with the 80-150 million of it just going to the bank. When the AOL/Time Warner merger was finalized; they were no longer making 80-150 million in profits a year. They were losing that much, if not more. They had lost sponsors and their fan base and as we have covered over the last month, that wasn't a result of the AOL/Time Warner merger. So losing that kind of money, any business man worth their salt would've tried to stop the bleeding and that's exactly what Jamie Kellner did. Business wise, he made the right decision.

    If the merger never happened, would WCW have lived on? It probably would've limped on in some form or fashion for a few more years until Turner finally realized that he was going to lose all of his money trying to keep it going, but I damn sure don't think that it'd still be around to this day. So again, the AOL/Time Warner merger did not kill WCW....

    WCW killed WCW!
     
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  2. Makaveli31

    Makaveli31 Championship Contender

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    I had to to LOL at this post. AOL-Time Warner was one of the, if not THE biggest financial disasters of all time. AOL Time Warner lost over 99 BILLION in 2002 alone. WCW was a drop in the bucket of this monstrosity. Everything was bleeding money not just WCW. AOL stock went from 226 billion to 20 billion. News Flash: WCW would've been sold if they made or lost 500 million dollars.

    The issue here is Eric Bischoff put together a group on investors ready to buy WCW. Fusient Media Ventures. They were offering close to 50 million to purchase WCW and were offering Time Warner a minority stake in the company to keep WCW on TNT and TBS (keep in mind Nitro was still the highest rated cable show on TNT.)

    Brad Siegel, head of WCW at the time, conspired with Stu Snyder (then-president of WWE) to make sure WWE could acquire WCW. Snyder and Siegel had a previous relationship. The only way WWE could counter Fusient's offer was if the WCW shows were cancelled. With no TV WCW was worthless. Siegel convinced Kellner to cancel the shows. With the shows cancelled Fusient was forced to withdraw their offer and WCW was sold for a paltry 2.5 million to WWE. There were four offers that were much more than what WWE offered. Siegel basically sabotaged his own company.

    THAT is the TRUE story of how WCW died.
     
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  3. SSJPhenom

    SSJPhenom The Phenom of WZ

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    Lol. I just don't get how people don't see the folly of keeping something that's losing millions of dollars. Idc what the AOL/Time Warner deal eventually became because that had jack and shit to do with WCW. Idc how the sell to WWE took place either. FACT is, AOL/Time Warner had nothing, NOTHING, to do with the pitiful state WCW found itself in at the end and it was going out one way or another.

    How people fail to see this is beyond me. I guess people don't understand how business works.
     
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  4. relentless1

    relentless1 G.O.A.T.

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    AOL/ Time Warner is the only reason this company went out of business; Ted Turner kept WCW around for years when it was bleeding cash so thats not even a factor for guys that didn't like wrestling.

    Nitro was still one of the highest rated shows on TNT by far and thats what network execs care about; if your theory about them canning WCW because of the money were true they they'd have let Eric buy it and gave him the TV time but they didn't; they didn't want wrestling around them period.

    This is the only reason that WCW folded and thats a fact; don't let WWEs agenda of superiority make you think that somehow storylines of a wrestling company affected the real corporate world LOL
     
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  5. relentless1

    relentless1 G.O.A.T.

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    lol do you know anything about how corporate taxes work? companies that lose money actually save money; their losses are compared against their earnings and this lowers yearly taxes for said corporation so even if it was about the money they'd have kept it if they liked it just to get the tax break
     
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  6. Makaveli31

    Makaveli31 Championship Contender

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    Well you're statement that WCW "killed" WCW is factually incorrect. The FACT is WCW could have lived on with the sale to Fusient and keeping WCW programming on TNT. The FACT is Time Warner could've made a hell of a lot more money by selling to Fusient and OWNING a minority stake in WCW rather than selling off to WWE for nothing and basically killing the company off. The "state" of WCW had nothing to do with what ended the company. Like I said, it was being sold one way of the other.
     
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  7. SSJPhenom

    SSJPhenom The Phenom of WZ

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    So let me see if I understand you two correctly. Your theory is that if the AOL/Time Warner merger never happened then WCW would have continued on, losing business left and right, with horrible storylines, and continuing to get worse and worse all the time?

    My ideas on WCW have nothing to do with WWE agenda. It's just what I believe. I also believe that if the WWE weren't the only legit game in town for professional wrestling that they'd be in trouble as well. WWE continues to get worse and worse and the only reason they've survived is because they've cornered the market for big professional wrestling. I honestly believe that if something doesn't change for them and fast that the WWE as we know it is on borrowed time.
     
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  8. SSJPhenom

    SSJPhenom The Phenom of WZ

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    Let's say they did sell to Eric and his group. How long do you think Eric and his group could've kept WCW running losing as much business as it was? They definitely didn't have the money Turner had. Hell, they had to put together a group of several investors just to make an offer. So how long do you think they could've weathered the storm of losing ratings, fans, sponsors, and money?

    I'm thinking not long and then what would've killed WCW?
     
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  9. Makaveli31

    Makaveli31 Championship Contender

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    Yes. As relentless1 stated no one actually loses money in a multi media corporation like Time Warner with a multitude of assets. As stated previously, they write off the losses and compare that to earnings. It's a tax break. As I said Nitro was still the highest rated show on TNT so it was generating ad revenue and still pulling in a sizeable TV audience.I would suspect they would eventually cut costs as contracts expired and downsized production costs but there is absolutely no reason to suspect they would have sold the company despite "horrible storylines."
     
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  10. Makaveli31

    Makaveli31 Championship Contender

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    That is pure speculation. I deal with facts.
     
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  11. SSJPhenom

    SSJPhenom The Phenom of WZ

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    So WCW's demise has nothing at all to do with the mismanagement of the company, the horrible contracts they gave to talent, the losing fan base, etc. It all falls down to AOL/Time Warner? That's what you believe?
     
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  12. ilapierre

    ilapierre Getting Noticed By Management

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    This. Right here. Enough said. Case closed.
     
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  13. relentless1

    relentless1 G.O.A.T.

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    its the truth; hard as it seems for you to grasp. The real world doesn't concern itself with storylines of a wrestling company... thats a drop in the bucket to guys like that in the corporate world.

    The cold fact is that Nitro was still the highest rated show on TNT so they had absolutely no reason to cancel it; they cancelled Nitro because THEY DIDNT LIKE WRESTLING. Thats it. Simple as that. They could've sold to Eric and had the money losing company off their books and at the same time still bring in ad revenue from the Nitro time slot. Any businessman worth their salt would take that deal... unless they personally didn't like the product they were dealing with...
     
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  14. ilapierre

    ilapierre Getting Noticed By Management

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    WWE has been mismanaged for well over a decade. It's complete garbage yet it's still on TV because some people will watch anything.

    If you deal with 'facts' it was the merger that ended WCW. In 2001, WCW was putting out a horrible product in comparison to what it had been producing 2 or 3 years prior. But the product could have continued on under Bischoff/Hervey for years had Siegel not conspired with WWE. There were so many things wrong with WCW (just like there are many things wrong with current WWE) but the actual 'demise' was a result of one thing: the merger. Period.
     
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  15. therockiswwf

    therockiswwf The voice of Michael Cole's headset

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    Oh dear god. Excuse me while you people make me lose my shit.

    Idiot.

    Ratings mean nothing. Ad revenue is king. A show pulling in 100 million viewers but zero viewers during commercial breaks will be canceled. Why? ADVERTISERS KEEP TV SHOWS ON THE AIR NOT RATINGS.

    Nothing to do with losing money, ad problems (low income of wrestling fans is a HUGE problem), crossover audience problems.

    Ted Turner lost power in the merger. This was also when WCW was losing 8 billion dollars a year. Connect the dots.

    They were still willing to sell to Bischoff. He didn't want it without TV.

    Wrestling audiences don't crossover with other shows. A complaint thrown around a lot when SD was on SyFy. Meaning they could replace WCW, lose audience but gain ad money and crossover potential. Win-win.

    Then why did no other TV company want WCW badly? Only FX did and they didn't offer enough to keep Bischoff and others interested.

    That is why so many companies purposely lose $100 million every year right? Also nothing to do with ad problems and crossover problems. Nah.

    Nope. Ad problems say hi again.

    It was not generating ad revenue. Bischoff himself confirmed this. He even said there would be articles written about the dangers of advertising with wrestling due to the low income of wrestling fans. Something WWE still deals with.

    IT WASN'T GENERATING AD REVENUE. HOLY FUCK.

    OH MY FUCKING GOD.
     
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  16. Makaveli31

    Makaveli31 Championship Contender

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    Ratings equal ad revenue MORON. Zero viewers during a commercial break? You are a complete and utter moron. A high rated TV show can command more money from advertisers because they reach more people and if you hit the 18-35 males you are gold in the advertiser's mind. You are brain dead.

    8 billion a year? PLEASE show me where they lost 8 billion a year?

    They were not willing to sell to Bischoff. That's what my original post was all about. Siegel and Snyder conspired to sell to WWE. They gave Bischoff the runaround untill Siegel concinced Keller to cancel the shows. Maybe you should connect the dots.

    Please post Bischoff's exact quote about Nitro not generating ad revenue and where I can find it because I have never heard this. The fact that Bischoff was willing to invest in WCW completely contradicts that statement.

    Provide a link to prove that Nitro was not generating ad revenue. The FACT is Nitro was averaging over 2.5 rating in it's last year and sometimes even went over 3.0 which is pretty damn good for a cable show. I would say that would definitely put in the top 10. I'm pretty sure they had no trouble getting advertisers and revenue.

    Here is the link if you care to research yourself or you choose to stay ignorant.

    https://www.twnpnews.com/information/WCW/wcwnitro.shtml
     
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  17. therockiswwf

    therockiswwf The voice of Michael Cole's headset

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    WWE could still draw a 4.0 when they did the last TV deal and it came in way under expectations. Why? Ad revenue. Why was ad revenue low? Low income of wrestling fans. Advertisers won't pay full price.

    Obvious exaggeration. They were losing an astronomical amount.

    Well except Bischoff himself said if FX had a better offer, they would have bought WCW. How could Siegel control what FX would offer?

    Well you know how Eric Bischoff has a DVD about him? The one where he states exactly what I'm saying? That is my source.

    They were not generating zero ad revenue (duh). They were generating way less revenue than normal primetime shows. Wrestling does that. WWE has always done that.

    Now for some fun stuff that proves my point.

    Quote on WWE's problem:
    http://adage.com/article/media/wwe-valuable-live-sports/291752/

    Make a note of the average income among WWE fans in this chart:
    https://postimg.org/image/sye62lxhv/
    This chart compares WWE to similar programming. Meaning advertisers will choose between them to reach a similar audience. WWE comes in dead last for income. So if I am going to advertise with WWE, I will not pay full price. Pro wrestling in general has this problem. It is not WWE-specific.

    That is because you don't do research. You see a big shiny number and shit yourself. Try doing some research next time.
     
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  18. Makaveli31

    Makaveli31 Championship Contender

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    So what?!? None of that equals the selling of a company. Vince is not going to shut his doors because of "low" advertising dollars and if you read the article they still got a 50 percent increase.

    Bischoff never said that and I never said Siegel controlled the competition. He controlled WCW hence the cancellation of the WCW programming on TNT and TBS which led to the sale of WCW to WWE. Learn to read.

    You mean a WWE produced DVD? So you expect Bischoff, being paid by WWE, to say "Yeah, Vince acquired WCW through an illegal backdoor deal with the president of WCW Brad Siegel." OK...keep drinking Kool-Aid.

    Advertisers still paid. They paid all the way from 1989 to 2001 so obviously low ad revenue did not kill WCW because it survived all those years and low ad revenue has not killed WWE.
     
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  19. therockiswwf

    therockiswwf The voice of Michael Cole's headset

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    You said:
    WWE hit those demographics. Yet didn't get top dollar. TV shows get canceled if ad revenue isn't high enough.

    Let's see the problems with selling WCW to Bischoff. Big names would likely be gone. Barebones roster. Massive loss of talent. Distant #2 company. Now sell that to advertisers because AOLTW still has to pay for WCW to produce a show. That also means AOLTW has to make a multi-year commitment to WCW (cause Fusient Media probably required a commitment). You see the problem here with low ad sales? Big risk on AOLTW's part to continue airing WCW.

    Except Bischoff did say this on his DVD...I mean like I just watched the DVD about a week ago.

    They were more than willing to sell to Bischoff. Fusient called off the deal not AOLTW.

    You must have a nice tin foil hat.

    And you have completely forgotten what we were talking about.
     
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  20. AnthonyM4

    AnthonyM4 Getting Noticed By Management

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    I agree. If wcw was still on par with wwe in ratings and making profit Jamie Kellner would have not took off that "low brow entertainment" from TNT and TBS. It's because of all the mistakes they made before the merger is what did them in. I've said it before and I will say it again- wrestling has not been the same since wwe bought their main competition and since then nobody has been able to compete with them and sadly may never will.
     
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  21. Makaveli31

    Makaveli31 Championship Contender

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    They are canceled early. Nitro lasted from 1995 to 2001. So obviously the revenue was there. Top dollar maybe compared to the NFL but I guarantee they were getting more ad revenue than most entertainment shows.

    50 million plus a stake in the company vs 2.5 million is not hard math buddy. AOLTW also would have had ownership so they wouldn't have had to pay to put WCW on. All they had to do was give WCW a time slot and considering Nitro was still the highest rated show they had, probably not that hard. You also had a company with the track record of generating hundreds of millions of dollars, was able to hit the 18-35 male demographic, was consistently pulling in ratings 2.0 and above even in it's lowest year, and was going to be based out of Las Vegas, a major media market. I don't think they wold have any trouble getting advertisers.

    Fusient called off the deal after Kellner (under orders from Siegel) cancelled all WCW programming. That is not disputed.

    You believe everything you hear?

    You said "low ad revenue" led to cancellation of the WCW shows yet WCW survived from 1990 - 2001 how do you explain that? If Nitro was not generating any revenue they would've cancelled it very early on considering it took a lot of money to produce. Like I said even WWE in a year where they lost money was able to command a 50 percent increase from advertisers so you're blowing this "ad thing" out of proportion. Nitro might've not been up there with pro sports but I guarantee they were still commanding a pretty significant amount vs other entertainment shows.
     
    #21
  22. MWRedskins

    MWRedskins Mid-Card Championship Winner

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    This is what i agree with 100% on....some will say WCW killed WCW and while it's true that WCW was pathetic, if it was sold to Bischoff's investors and they either 1) had another channel for WCW to air or 2) if the original deal went down, then WCW would still be around today, just likely not in the great shape that it used to be in.

    the problem was the tv time was cancelled and Siegal and Kellner were behind this and AOL/Time Warner was a bad merger for both parties in the end because in the end, both companies were losing money and then split up. in fact, Time Warner is now gone if i am right and they are now Spectrum.

    to me all the issues before it (Bischoff, Russo, Hogan, Sullivan and others) were small dents in the ship, but AOL/Time Warner was the major hole in the ship, the one that caused the ship to sink to the bottom.
     
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  23. therockiswwf

    therockiswwf The voice of Michael Cole's headset

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    It was more profitable for Spike TV to air reruns of cops over TNA. Why? Ad revenue. WWE went PG because big advertisers would not touch them due to the perception (wrestling being dirty) and the income problem. While that hasn't fixed all of their problems, it did help them get a bigger TV contract.

    WCW was losing money and ad sales could not make them profitable. Nitro only lasted that long because Ted Turner protected them. His decision to keep Nitro was not a business one. The decision to cancel it was. They could replace it with something that commands top dollar, crossover appeal and wasn't losing a crap ton of money.

    Again, ratings don't necessarily equal ad revenue. It also does not equal profit. WCW was losing money. I've given you evidence of this. I can give a ton more. You seem to purposely ignore it or are not smart enough to understand it. They did have trouble with advertisers. Bischoff literally said advertisers were warned to not touch wrestling. That was a big problem.

    AOLTW would have to pay WCW a TV contract. That isn't cheap. They were able to hit those demographics when they had big names. They couldn't get those names anymore. It was obvious that their future was not bright.


    No, WCW was losing millions and Kellner made a smart business decision. Here is a fun fact. WWE couldn't even get WCW a TV show. WWE was airing Raw, SD, Heat, Livewire, Jakked, Excess, Superstars and Attitude. Not all of those aired worldwide but they couldn't even convince NBC to air Nitro.

    No but I also don't believe things that are obviously preposterous. Your conspiracy would involve a person purposely losing millions of dollars for zero gain. My theory is based on evidence and logic.

    Actually they wanted to cancel it. Numerous times. Only Ted said no. No one could fight Ted. They didn't want to cancel it when it was raking in money. Once it started losing money, they did. WCW only made a profit in 96, 97 and 98 since 1990. I'm not sure what the situation was like before 1990.

    You misunderstood. It was hard to see how they were going to recoup a TV contract with a company that does not draw top dollar for advertisements and was getting worse in terms of star power.

    WWE lost money because of the Network startup costs (that took a TON of money). Otherwise they have been on a record revenue (not net income) streak for a few years in a row. So it wasn't alarming that WWE lost money. The product may not be at its healthiest but they are making money.

    Again, stop shitting yourself when you see a big number. Do research. You didn't even try to find out why WWE would get an increase when they lost money. You didn't find that odd at all. You seem to lack critical thinking skills.
     
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  24. AnthonyM4

    AnthonyM4 Getting Noticed By Management

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    According to the death of wcw book, the only reason wcw wasn't shut down in 1993 was because Ted Turner liked it. That's it. 1993 was a pretty bad year in wcw.
     
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  25. relentless1

    relentless1 G.O.A.T.

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    the only reason WWE couldn't get WCW on TV was because of the deal they had with TNN at the time barring them from airing a wrestling show on directly competing networks
     
    #25

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