The possibility & consequences of the WWE going bankrupt

[Ding_Dong_#2]

It may seem impossible, it may seem very unlikely but there is always a chance that the WWE may go bankrupt one day.

Through product alone, this may seem unlikely through the genius of Vince McMahon. But we have seen to many failed ventures when Vinny Mac tries to venture outside of his comfort zone. The XFL, Icopro, the WBF, the production line of very poor quality WWE films and most recently Linda McMahons senate campaign. All have generally not only failed, but failed to the point of being a laughing stock.

What would happen if this was the case? The most likely scenario is that the company would find new owners but this could spell disaster as they would likely to want to change the product significantly. The alternative is, like WCW, it could close it's doors completely.

Would John Cena join TNA? Would another wrestling firm rise out of the ashes? Maybe losing the WWE would mean that wrestling generally becomes a non-mainstream sport and returns to the days of the independents & regional programming as it was pre-McMahon Jr. There will always be a market for wrestling in some form so there is just no way the sport would die out altogether, but there is a very real danger, especially that the WWE is now considered "Entertainment" and not a "Sport", that you are placing it in a market of being just another television show and televison shows most definitely have a shelf life.

Some people would welcome a return to the good old days. There are many sports that have gone off the charts temporarily, crashing down to the bare bones and that's when the real fans come in; real fans who would pay to see anyone compete in no matter how bad a match, in some dusty sports hall somewhere. That is the key for me - the true test if you are truly a sports fan, whether you could watch any match anywhere and get something out of it.

Maybe this needs to happen. Wrestling is an art form and we have lost a great deal of the initial impetus that made this sport what it is today. People mention high-spots and the like but you can still be technical wrestlers and have high-impact moves; the Steiner Brothers were great examples of that. Maybe if the WWE went bust, we would begin to see wrestling as to how it truly is and was; i'm not suggesting a return to Ed "Strangler" Lewis having someone in an armlock for 30 minutes but wrestlers who are inventive and don't rely on choreographed six-move set.

Personally speaking, I wouldn't like to see this. The WWE clearly want it all, lock stock and barrel but are generally respectful towards the lineage of the industry and continue to evolve, but also rely too much on the same, stale performers

 

[daddyJ_t]

th wwe will never go bankrupt plain and simple. but would i like to see the old days return? yes.not quite territories, but more like a triple threat wwf/wcw/ecw. where there was competition and everything was chaotic. lets use cena. cena is unhappy and with other options, he can pull a brett hart or alundra blaze. imagine randy orton appearing on a taped smackdown episode which airs on friday and a live thursday night wcw thunder similair to rick rude being on raw and nitro in the same night. the old days were fantastic in it made the talent work harder and the product better. but vinnie mac will never let it get that far. the only way he would go bankrupt is if he over spent trying to bury another company

 

[Remix]

The answer is simple. If WWE went down tomorrow, Professional Wrestling in America dies. There is no other company that has the finances to make it worthwhile for anybody who'll ever draw a dime to get into the business.

It may seem impossible, it may seem very unlikely but there is always a chance that the WWE may go bankrupt one day.

Through product alone, this may seem unlikely through the genius of Vince McMahon. But we have seen to many failed ventures when Vinny Mac tries to venture outside of his comfort zone. The XFL,

Lasted one season, got killed before it severely harmed the company and now barely remembered.

Icopro,

What the hell was Icopro? The fact that I had to google it to find out that it was a line of suppliments (the brand name of which was sold to another company) speaks volumes about its relevance to anything.

the WBF,

Yeah, that was a stupid idea.

the production line of very poor quality WWE films

The star of the latest WWE financed Film at work. Also, you're forgetting that WWE Films was actually making the company a fair amount of money recently (not last year though) because their films were dirt cheap and sold decently in the bargain bin of Walmart. Since that didn't work last year, they're changing their business model. If that fais they'll probably kill the studio.

and most recently Linda McMahons senate campaign.

That she funded with her own money?

All have generally not only failed, but failed to the point of being a laughing stock.

And most of them failed after a short time, meaning that the company didn't take a long term hit on its bottom line.

What would happen if this was the case? The most likely scenario is that the company would find new owners

Who would buy a WWE that's not making money? For WWE not to make money attendence would have to plummet, buyrates drop like a stone, and lose more network revenue. Now, if that's happening to WWE imagine what's happening to smaller companies in the wrestling business. If people aren't paying to see WWE's show, how likely is it that they're going to pay to see the company that can't even pay Lance Storm a fair wage, or TNA whose buyrates are (allegedly) under 10,000. So, I repeat, who would buy an unprofitable WWE in an industry that's clearly dead? WWE were the only people willing to buy WCW, and they got it at a bargain bin price, and mostly for the talent and tapes. If WWE dies, the talent becomes worthless because they've aptly demonstrated that they're not able to draw fans to a WWE show (and there's nowhere else to go), and the tapes become worthless because fans have already demonstrated that they're not willing to pay for WWE stuff.

but this could spell disaster as they would likely to want to change the product significantly. The alternative is, like WCW, it could close it's doors completely.

They'd have no choice. Because nobody would buy them.

Would John Cena join TNA?

No, because logically TNA would die first.

Would another wrestling firm rise out of the ashes?

No, because logically the relevant indies would die before WWE, and who'd invest in one of the the irrelevant ones?

Maybe losing the WWE would mean that wrestling generally becomes a non-mainstream sport and returns to the days of the independents & regional programming as it was pre-McMahon Jr.

If by that you mean "shrivel up and die" yes it would.

There will always be a market for wrestling in some form so there is just no way the sport would die out altogether,

If people aren't watching WWE with all of its well produced shows on TV why would they watch Regional fed #82 which would have a fraction of the budget, wrestlers paid a fraction of the wage (which would likely indicate that fewer people would do it, and those that do being less able to get a job elsewhere) and be a smaller operation (if Broadway died, you wouldn't expect people to watch shows at the local theatres in the same numbers as they did at Broadway). In any case, WWF didn't kill territories, cable did because people wanted to watch the big, national federation over the small local one. Or that's Jim Ross' take on the matter and he was there at the time.

but there is a very real danger, especially that the WWE is now considered "Entertainment" and not a "Sport", that you are placing it in a market of being just another television show and televison shows most definitely have a shelf life.

Yes, a television show that makes most of its money in ways that aren't subject to the ratings.

Some people would welcome a return to the good old days. There are many sports that have gone off the charts temporarily, crashing down to the bare bones and that's when the real fans come in; real fans who would pay to see anyone compete in no matter how bad a match, in some dusty sports hall somewhere. That is the key for me - the true test if you are truly a sports fan, whether you could watch any match anywhere and get something out of it.

So you're saying that only fans who'd watch shitty wrestling in a school gym are "real fans"? Then there's barely any of them and the feds they turn out to watch in dusty halls need charity to book Lance Storm. Yeah, that's who Wrestling should appeal to. That would be a great thing to happen.

Maybe this needs to happen. Wrestling is an art form

Wrestling is a business at the end of the day. And if the only way that it can exist is with 50 fans watching in a gymnasium nobody smart's going to go into the business. You know why little boys and girls want become pro wrestlers? Because they want to be in WWE some day. If WWE stops being something to aspire to (such as becoming an irrelevant promotion running shows in a gymnasium) then nobody's going to enter it, nobody with a brain is going to be able to work in the business full time because feds that draw 50 people a show aren't making enough money to make that possible and nobody's going to pay to see it because it's a shitty show in a shitty building with shitty "talent".

I'm skipping most of the rest of this paragraph because it's moronic.

but wrestlers who are inventive and don't rely on choreographed six-move set.

1) "Moves don't matter" - Lance Storm
2) You know why Cena, Hart, Hogan, 'Taker and Michaels rely/relied so heavily on a small moveset? Because those moves pop the crowd. The crowd has been trained to respond to them. A large crowd is harder to wow with two dozen types of armbar than a smaller one. Because most of them can't see anything.

Personally speaking, I wouldn't like to see this. The WWE clearly want it all, lock stock and barrel but are generally respectful towards the lineage of the industry and continue to evolve, but also rely too much on the same, stale performers

The stale performers who pay the salaries of the rest of the roster, you mean?

 

[wooooo]

There was more chance of them crumbling in 1996 than there is now as WCW would have had the chance to be the big attraction.

For them to go bankrupt now would mean the majority of people would have lost interesting in wrestling altogether as WWE is the only company alot of people watch or even know about.

Sure TNA would get a few more viewers but they're not exactly having major success yet they're the second biggest company.

Enough wrestlers are struggling to get exposure as it is so it would only get worse.

 

[LoudClearVoice]

No offense, but it wouldn't surprise me if this thread ends up in the trash.

WWE won't go bankrupt. It's not about wrestling. They're in the ENTERTAINMENT business. They make billions of dollars every year and I think (although I have not looked at their financial reports) they still made a profit even in the "down years" right after the attitude era.

It's more than just RAW and Smackdown. They have tours, social media, internet, WWE store, movies, Make-a-Wish, books, action figures, etc. Don't forget that this is an international enterprise. WWE is making money all over the world.


Let's live in a fantasy land for a second: If WWE went bankrupt, wrestling would be dead. Sure, you'd have some dorks packing a gym on Friday night to watch Super Dragon fight some idiot but those events would be few and far between. For all intents and purposes, wrestling would be dead.

 

[neildittmar]

Lets make sure we're not confusing the meanings of the terms Bankruptcy (Chapter 10 / Reorginzation in the US) and Liquidation (Chapter 13). If gigantic corporations like Circuit City, Blockbuster, Chrysler, GM and huge financial institutions can declare bankruptcy, certainly the WWE is not invincible from it either. Likewise with the notion of them at some point having to close their doors and liquidate. Either could potentially happen at some point during the companys existence.

I suppose the real question is would it? If WWE ever finds itself in a position where its debts are increasingly mounting, profits are significantly down, it has been forced to future endeavor a significant portion of its roster (specifically key players), and business has dropped off substantially then it's entirely conceivable that the company could file for bankruptcy. Some may point to certain individual events, like the OP did, to suggest that WWE is begining to head in this direction now.

If WWE did in fact declare bankruptcy I don't think they would liquidate and close, at least not on the first go around. They'd do the typical "restructuring our debts" and becoming a "leaner, meaner company" dance like so many other firms do when forced into that position. As for the changes themselves? You'd probably see Smackdown and other "B shows" disappear, half the roster or so cut, and an overemphasis put on the major stars(read: older/established talent) that are known to draw money. You'd also see losing prospects like WWE films hit the skids as well.

In the case of an outright liquidation and closure, companies like TNA and ROH could still certainly survive in a post-WWE world. Above all else, WWE has built itself up over the years as the be-all, end-all of wrestling, even though it likes to call itself sports-entertainment. Other companies, like the aforementioned, work within a much smaller footprint both geographically and financially than WWE. WWE risks a lot in order to obtain a high reward (ie; Wrestlemania). Too many of those risks that don't reap sufficient benefits and you've got a company on the proverbial ropes. A few more "bad decisions" and you have a bankruptcy proceeding. Mess up again after that, and you may just be auctioning off your assets.

The point is, professional wrestling was around before the WWE and could certainly survive after its proposed demise. Will it be a much smaller industry? Absolutely. TNA doesn't "win" by default if WWE goes under. If it tries to assume the exact same role WWE did, it also assumes the same problems and issues that would've hurt WWE financially and broke them in the first place. Other than picking up some of the free agents with Panda Energy money, TNA pretty much stays in its same spot after an initial surge due to the closure.

Wrestling certainly wouldn't be dead though... maybe as a mass market billion dollar industry like the WWE has turned into, but it certainly wouldn't be snuffed out completely. Somebody, somewhere, at sometime would still be putting on wrestling shows for the remnant of the audience who wants to see them.

Regardless of its place as the bona fide king of the industry, WWE is not bigger than the sport of professional wrestling. That's to say, wrestling doesn't die if/when the WWE does.

 

[justin71]

Not going to happen a scaled down WWE will happen first where there are fewer ppv's and RAW is taped like Superstars in the 80's. Either way I don't see it happening the difference is in 96 WCW was at it's peak with Ted's money at the helm with their one good sl and WWE had been in a spiral since 93-post Hogan.

 

[scomvp316]

There would have to be a major incident even bigger than the Benoit fiasco for sponsors to drop WWE. So its almost impossible for the WWE to lose money unless Steph is a major idiot but there will be enough VKM lackies around her to make sure she doesn't screw up the business side of WWE. The most real possibilty is WWE being kicked out the NYSE. They are dangerously close in being cited by the NYSE Commissioner based off of projected net profits over the next five years. WWE is struggling to try and get to the $750 mill gp per year. From last year they got over the $650 mill mark which was a sharp increase from previous year of near $600 mill. Any fan that thinks that WWE still makes over a billion a year is seriously delusional. WWE hasn't made a billion in sales since 2002. So WWE will never go bankrupt but I can see them being dropped as a public trading company within the next three years. Having the Network will make or break them for a log term growth period of staying in the NYSE. Keep in mind to stay in the NYSE your GP has to be at least $500 mill or five straight years of 15% growth each year prior to the next in that five year period. So there are rules to be considered a public trading company not just wanting to go public is enough to qualify for trade in the NYSE. Just take a look at BK seeing they were briefly suspended from the NYSE until earlier this year as their profits have tripled and management made cuts to outside businesses BK use to own

 

[WolfNyte]

I chuckle when I see people bring up the XFL so many dont remember what helped KILL the XFL and that was in fact the NFL.

The NFL told TV stations if you carry the XFL then you will never have a superbowl or playoff on your station.

The NFL started stealing the top players in the XFL to make them bench warmers but out of the XFL.

The NFL even before game one of the XFL was out to destroy it because it was competition. Hmmm I wonder how vince learned to take out the competition.

The NFL during any NFL show or game would constantly take jabs at the XFL and call it sandlot football among other things.

Lets face it with all this against you How do you win. You dont you pack it in and forget about it. I loved the XFL games and even the NFL stole some things from the XFL and incorporated them into their televised games.

 

[FlairFan2003]

I chuckle when I see people bring up the XFL so many dont remember what helped KILL the XFL and that was in fact the NFL.

The NFL told TV stations if you carry the XFL then you will never have a superbowl or playoff on your station.

The NFL started stealing the top players in the XFL to make them bench warmers but out of the XFL.

The NFL even before game one of the XFL was out to destroy it because it was competition. Hmmm I wonder how vince learned to take out the competition.

The NFL during any NFL show or game would constantly take jabs at the XFL and call it sandlot football among other things.

Lets face it with all this against you How do you win. You dont you pack it in and forget about it. I loved the XFL games and even the NFL stole some things from the XFL and incorporated them into their televised games.

What the NFL did to the XFL was EXACTLY what Vince did to WCW and other promotions in the 80s - Vince blackmailed cable operators that he wouldnt allow them to carry future WWE PPVs if they offered both Survivor Series & Starrcade in 87, for years starting in the 80s and into the late 90s Vince would sign Exclusivity Agreements with major arenas in top wrestling cities barring them from hosting any wrestling related events not sponsored by WWE, and of course especially in the 80s Vince stole gimmicks and even talent from rival competitors on a regular basis.

Heck, the whole 80s & early 90s WWE roster was built almost entirely on guys who main evented elsewhere, often using the same or very similair gimmick and look (Steamboat, Piper, Valentine, Savage, Race, Hogan, Orndorff, Blanchard & ANderson, Jake Roberts, Road Warriors, Flair, SId, HBK) - occassionally he created a "new" gimmick by either patterning it on an existing one in a rival company (The Million Dollar Man gimmick was based in part on Ric Flair) or just completly stealing it (The horrible knock off Demolition was never more than a cheap version of LOD).

Yeah, instead of asking where Vince learned how to kill off the competition, you should have noted the NFL killed its competition by employing all of Vince's previously used tactics.

 

[Killercam]

Well when Vince dies I'm sure everything is going into the hands of Shane and Steph (of course trips too) but both Shane and Steph have proved they have at least half of the charisma Vinny has so that is a good thing. Bottom line is I think like many of the family businesses of old Vince has taught his children the importance of the family name and standard he has set by virtue of following in his own fathers footsteps. I think the sooner the power is turned over the better, Vince is getting old and if history has taught us anything at some point you have to hand over the reigns. The controversy over the promo Cena cut after the last ppv shows that everyone is not on the same page right now anyway. the future is bright I believe, and they can usevRock, Brock and even SCSA to gain back a few old Attitude Era fans (although I think Rock still has 7 or 8 good years in him).

 

[JJohns]

I chuckle when I see people bring up the XFL so many dont remember what helped KILL the XFL and that was in fact the NFL.

The NFL told TV stations if you carry the XFL then you will never have a superbowl or playoff on your station.

The NFL started stealing the top players in the XFL to make them bench warmers but out of the XFL.

The NFL even before game one of the XFL was out to destroy it because it was competition. Hmmm I wonder how vince learned to take out the competition.

The NFL during any NFL show or game would constantly take jabs at the XFL and call it sandlot football among other things.

Lets face it with all this against you How do you win. You dont you pack it in and forget about it. I loved the XFL games and even the NFL stole some things from the XFL and incorporated them into their televised games.

The NFL didn't steal any players from the XFL. Players that went from the XFL to the NFL did so AFTER the XFL had already folded. Remember, the XFL was a Winter/Spring football league, where the only real competition would have been NFL Europa.

The networks that broadcast the XFL were UPN(who never was going to get a weekly NFL game), TNN(same as UPN) and NBC(who co-owned the league with WWE), none of them had NFL ties(NBC had lost the NFL to CBS in previous years) and it would be another 5 years before the TV contracts opened back up for bidding.

The reason that the XFL failed is because, to put it bluntly, it sucked. It was terrible. The ratings sank quickly, the stadiums were half-empty on a good day, and NBC decided to jettison it's losses after one year.

Oh, and go ahead and tell Tommy Maddox, Rod Smart and Kelly Herndon that they were "benchwarmers" in their post-XFL careers.