PPV Paydays

[tvcolosi]

I have heard that guys are worried about PPV bonuses, its rumored that is the biggest reason Punk left. By my calculations are right they'll likely make the same amount of money or more year over year.

I first want to say the idea of people being mad about a "bonus" makes no sense to me. Bonus buy definition is doing more than required. WWE is bound by the downside guarantee in your contract, not a penny more. Now if this is an issue WWE will likely raise people down sides. But I digress...

Take the average B PPV, WWE gets 50% of that money in the old system. So at an average of $35, WWE pockets a little over 5.2 million. If WWE gets the million subscribers they are predicting, clearly that's 10 million a month. Not to mention if its a big hit like it might be and maybe get into 2 million range.

So if WWE puts 60% (or 6 million) of the network payments into the PPV bucket, they are making more than traditional PPV. Now obviously they will make less in in April for Mania. Although with the profit in the other 11 months, this should be enough to close that gap. Am I really bad at math or is there something to this?

 

[Y 2 Jake]

Punk left before what whill be the biggest WWE show of all time because of PPV bunuses and as such he will miss out on a Mania XXX bonus? He sure lacks foresight.

Your calcualtions might be right. I didn't read them and I couldn't actually give a shit if wrestlers get PPV bonuses.

 

[Catacomb]

the way i understand it is
wwe will make the money according to your post, but due to no ppvs there is no ppv payoff

therefore no "bonus" if you want to call it that at all for anyone other than vince

 

[NegativeFeedback]

I have heard that guys are worried about PPV bonuses, its rumored that is the biggest reason Punk left. By my calculations are right they'll likely make the same amount of money or more year over year.

I first want to say the idea of people being mad about a "bonus" makes no sense to me. Bonus buy definition is doing more than required. WWE is bound by the downside guarantee in your contract, not a penny more. Now if this is an issue WWE will likely raise people down sides. But I digress...

Take the average B PPV, WWE gets 50% of that money in the old system. So at an average of $35, WWE pockets a little over 5.2 million. If WWE gets the million subscribers they are predicting, clearly that's 10 million a month. Not to mention if its a big hit like it might be and maybe get into 2 million range.

So if WWE puts 60% (or 6 million) of the network payments into the PPV bucket, they are making more than traditional PPV. Now obviously they will make less in in April for Mania. Although with the profit in the other 11 months, this should be enough to close that gap. Am I really bad at math or is there something to this?

You are bad at match. You're assuming all revenue is profit without acknowledging the costs. The budget for the network is far greater than their previous PPV budget. They need 1 million subscribers to BREAK EVEN.

So yeah, their revenue won't be damaged, but the revenue doesn't go towards the individual PPV events anymore. They now go towards a 365/24/7 network. Obviously, bonuses won't be the same.

 

[JJ15776]

Wrestlers are going to continue getting paid whatever they get paid. WWE already pays them what they want to pay them, and they will continue doing so. They determine what somebody is worth to them, pays them that, and if that person wants more then they can leave. WWE has all the leverage, because they don't care if anybody leaves. It's not like they're being forced to pay people more than they want to and this is a way of screwing them out of the money.

 

[tvcolosi]

Punk left before what whill be the biggest WWE show of all time because of PPV bunuses and as such he will miss out on a Mania XXX bonus? He sure lacks foresight.

Your calcualtions might be right. I didn't read them and I couldn't actually give a shit if wrestlers get PPV bonuses.

if you had read my 2nd paragraph, that was my overall point... a bonus is not guaranteed, it is by definition over and above what is expected.. like a waiter being mad you only tipped 15%, I didn't "have" to give you a penny.

 

[TWJC: The Beginning]

You are bad at match. You're assuming all revenue is profit without acknowledging the costs. The budget for the network is far greater than their previous PPV budget. They need 1 million subscribers to BREAK EVEN.

So yeah, their revenue won't be damaged, but the revenue doesn't go towards the individual PPV events anymore. They now go towards a 365/24/7 network. Obviously, bonuses won't be the same.

Where is the announcement that they need a million subscribers to break even?

Where is the 50/50 split the OP suggested? 50/50 with who? WWE and the superstars? Or 50/50 with the PPV providers?

 

[NegativeFeedback]

Where is the announcement that they need a million subscribers to break even?

Google It. I just did, and got tons of hits.

Where is the 50/50 split the OP suggested? 50/50 with who? WWE and the superstars? Or 50/50 with the PPV providers?

He meant with the PPV providers, but I doubt it's an even ratio. I'm guessing that WWE takes home about 60-65% of the PPV money.

 

[TWJC: The Beginning]

Google It. I just did, and got tons of hits.



He meant with the PPV providers, but I doubt it's an even ratio. I'm guessing that WWE takes home about 60-65% of the PPV money.

Yea, and the USA article said the one million subscription number is break even COMPARED TO THE OLD MODEL. In other words, if they only get 1,000,000 subscriptions, they're making more than before. Not that they're breaking even on what the network costs.

http://www.usatoday.com/story/money/2014/02/23/wwe-network-launch-vince-mcmahon/5694451/

Since an average 800,000 to 1 million homes will buy two to three pay-per-views a year — generating $50 million to $60 million domestically in revenue — WWE Chief Strategy and Financial Officer George Barrios figures the break-even point compared with the old model is 1 million subscribers.

Then he goes on to say:

If that number ends up being 2 million or 3 million, he says, there's potentially as much as $150 million in incremental OIBDA profits . "It's a game-changer for us if it works," Barrios says.(OIBDA stands for operating income before depreciation and amortization.)

So yea, looks like either I misread what you guys were trying to say (I read it as, if there aren't 1,000,000 subscriptions then WWE loses money on the Network). Or I did read what you meant correctly and you misread what they said.

Where do you get the 60-65% number of take home on PPVs?

http://www.f4wonline.com/more/more-...3-wwe-financials-examined-wrestlenomics-style

This says 49%. Granted it may not be the most credible source.