ESPN covers Summerslam Sunday

August 23, 2015

While there is a Sunday night UFC Fight Night from Saskatoon, Canada airing on FS1 DSunday night, the event might be overshadowed by WWE’s Summerslam which will air at the same time as the live MMA event on the WWE Network and through PPV.

The WWE has received support in promoting this event from ESPN which is airing live at the Barclay’s Center in Brooklyn, New York where the company is holding three sold out events which started last night with the WWE’s developmental arm NXT holding an event.  In addition to Sunday’s Summerslam, the company will air Monday Night Raw from the same venue.  Former WWE commentator and current ESPN anchor Jonathan Coachman was a central part of the coverage.

According to Forbes.com, there was some controversy as to whether ESPN should cover the WWE event.  However, the company decided to make the decision to cover it for a variety of reasons.  Forbes.com touched on the fact that ESPN is losing subscribers and covering the WWE is a way for ESPN to attract more viewers.  Earlier this year, ESPN aired Brock Lesnar’s decision as to whether he would sign with the UFC or stick with the WWE.  It also produced a documentary featuring WWE superstars.

Strategically the WWE has offered a free month of WWE Network for non-subscribers which should boost viewership.  The offer is an almost quarterly strategy to entice curious fans to sign up.  As of the last earnings call, it appears that paid subscriptions are doing well and offering the free month is one of the reasons the sub numbers have progressively increased.

Payout Perspective:

This summer, ESPN has done live remotes at unique sporting events across the nation to give little known events some notoriety.  This, of course, is a little different.  In the past, ESPN has covered Wrestlemania in the past but never in a serious capacity.  ESPN’s involvement in covering Summerslam is great for the WWE.  In year’s past, the company’s biggest card of the summer was held in Los Angeles but interest had waned.  This year appears to have had a resurgence and part of that has to be due to ESPN’s involvement.  Brock Lesnar was on the network earlier in the week and you may recall he indicated that Vince McMahon was a better promoter than Dana White.

Based on the attendance from Saturday and the anticipated attendance for the next two events, it appears that the WWE has found a new home for Summerslam.

Hulk Hogan terminated by WWE after audio of racist rant surfaces

July 24, 2015

World Wrestling Entertainment has terminated the contract of Hall of Fame wrestler Hulk Hogan.  The decision was made based on audio that surfaced from 8 years ago.

Hogan has been wiped from the WWE web site and eliminated from his current position on the USA reality television series “Tough Enough.”

The audio tapes relate to racist comments made by Hogan 8 years ago.  The information appears to be a part of sealed information from the pending Gawker lawsuit in which Hogan sued the web site for releasing a sex tape.  It would appear that the release of the audio tapes were done as retribution for the lawsuit.

Hogan has released a statement apologizing for the racist comments.   The bad news for Hogan is that there are inferences that there is more audio coming out.

Payout Perspective:

Even though many people here are MMA fans, it’s clear that everyone knows Hulk Hogan.  This makes the decision by the WWE to immediately distance itself from one of its biggest stars ever more surprising, yet appropriate.  As a publicly traded company, the WWE did not want to come under fire for Hogan’s comments and suffer any financial repercussions.  While its WWE Network is gaining traction with consumers, it’s still needs to find a way for the investment to break even.  Negative publicity like this is not good for business.  As for Hogan, his reputation is marred and he joins Bill Cosby as a pop culture figure of the 1980s who we now see in a different light.

Did Gawker have anything to do with the release of these tapes?  Not sure.  But, it will make the trial between Hogan and Gawker that much more contentious.

Judge denies motion to dismiss in Punk libel lawsuit

July 22, 2015

The Washington Post reports that the lawsuit between WWE doctor Chris Amman and CM Punk and Colt Cabana will continue after a Cook County (IL) Circuit Court judge denied defendants’ motion to dismiss the case.

As a result of the court’s denial to dismiss the case, CM Punk and Colt Cabana must answer Amann’s complaint claiming that the two libeled the WWE doctor during an episode of Cabana’s podcast.

On the Art of Wrestling podcast, Punk called into question Dr. Amann’s treatment of his concussion and an injury on his back with was diagnosed as a MRSA staph infection.  Cabana is being implicated for being the host of the podcast.  He is also a good friend of the now UFC fighter.

The WWE aided Dr. Amann despite not being a party to the lawsuit as it sent out a statement regarding the lawsuit and providing video purported evidence that Punk did not have a lump on his back.

Payout Perspective:

Procedurally, a motion to dismiss the lawsuit prior to answering the claims in a complaint is necessary and occurs when the one being sued believes that there is no merit to the claims.  Here, Punk and Cabana took their shot at dismissing the lawsuit.  But, there was a sufficient amount of information pled by Dr. Amman according to the court.  Its likely Punk and Cabana will deny the allegations in the Complaint when they file an Answer and we may see prolonged litigation.

Estate of former WWE wrestler files head injury lawsuit

June 28, 2015

The estate of another former WWE wrestler has filed a lawsuit against the organization.  The mother and son of Matt Osborne (aka “Matt Borne” and “Doink the Clown”) have filed a wrongful death lawsuit against the company for the alleged negligent and fraudulent mistreatment of Osborne while he was a wrestler with the company.

The Osborne lawsuit was filed on June 26th in the U.S. District Court for the North District of Texas, Dallas Division.  The Dallas Morning News covered the lawsuit.  Osborne died in 2013 of a painkiller overdose at the age of 57 in Plano, Texas.  The family claims brain injuries caused while a professional wrestler caused depression and drug abuse which led to his death.

The WWE, utilizing the same public relations strategy as in similar lawsuits, claims that the lawyers are the ones driving these lawsuits pegging the attorneys as opportunists.  The WWE indicates that the Osborne lawsuit is merely seeking “NFL money” in reference to the NFL concussion lawsuits which likely will result in settlements for those involved.

In a similar lawsuit, Billy Jack Haynes’ case against the WWE that was filed in Oregon has been transferred to Connecticut upon motion by the WWE on the basis that he signed WWE booking contracts which indicated that the forum of choice was the home state of the WWE.

Payout Perspective:

Osborne spent limited time in the WWE throughout his wrestling career which may make his claim hard to prove.  However, it does not negate the alleged negligence that the WWE may have contributed to his injuries.  The complaint points out specific instances where Osborne was injured during his stint in the WWE.  It also claims the WWE knew and/or knew but did not warn him about the perils of head injuries.  Notably, the complaint has a similar template as other lawsuits filed by former WWE wrestlers.  However, at least one part of the lengthy complaint has been updated to include a photograph embedded in paragraph 139 of the complaint which shows the WWE is taking precautionary steps with its talent now with helmets used in training.

This lawsuit may be moved to Connecticut like Haynes’ lawsuit as one might infer that Osborne signed a WWE contract with a forum selection clause which would dictate where a lawsuit would take place if one should happen.  We will see if more wrestlers continue to file lawsuits which appear to be similar to the NFL and NHL concussion litigation.

The Wrestling Post – 06.02.15

June 2, 2015

Welcome back to another edition of The Wrestling Post.  This time around we take at the WWE Network offering another free month and the uncertainty of the status of TNA Wrestling.

WWE offers another free month on its Network

With the success of recruiting and retaining more network subscribers through its “free” network months, the WWE has added another free month of June for non-subscribers.  It just came off a “free” month of May which culminated in a special live show.

Payout Take:  There is no initial reason given for the second consecutive month of the “free” Network offer.  We can’t read into anything but from the past indicators, the WWE has been able to collect a fair number of new paid subscribers from its free promotion.  Thus, when people sign up for the free month, they tend to stay on and pay the following month instead of cancelling after the free month is up.  The one question is whether the “free” month will be a mainstay for the network.  It appears that the this strategy is the “go to” move to boost subscribers.  We shall see if this means another improvement with its overall subscription numbers when it makes another announcement after the end of the second quarter.

Ring of Honor now on Destination America; TNA status in jeopardy

In what was a newsworthy week last week for the Discovery Network’s offshoot, Destination America, it was announced that wrestling promotion Ring of Honor will air on the network starting Wednesday, June 3rd.  The interesting part about this situation is that the ROH announcement came after news that Destination America would not renew TNA Wrestling next year.  The Wrestling Observer first reported the news that TNA Wrestling would be not renewed as Dave Meltzer obtained an internal memo from Destination America indicating that the promotion would not be renewed.  TNA Wrestling is being moved from Friday to Wednesday and will now serve as the lead-in for ROH.  While there was the possibility that Destination America could have changed its mind if TNA ratings skyrocketed on Wednesday nights, the ROH announcement makes it highly unlikely TNA will be back on Destination America once its contract ends this year.   The station had an “out clause” at the end of the current TV season according to The Wrestling Observer.

Ring of Honor programming is currently available regionally via the Sinclair Broadcast Group. The Destination America deal is great for the promotion since it gives them national exposure and taps into markets that it could not reach with Sinclair.  According to The Wrestling Observer, the deal with ROH will only go through December 2, 2015 so we may see more movement from Destination America this year.

Payout Take:   Regardless of the semantics (cancelled vs. not renewed), Destination America made the decision that the production costs of carrying TNA Wrestling outweighed the ratings (and ad revenue) it received from the program.  Ring of Honor is a cheaper alternative for Destination America since it will not be paying for production costs for ROH.  Wednesday will be filled with wrestling as it joins Lucha Underground and NXT with live wrestling that night.

WWE Q1 2015 results

April 30, 2015

The WWE announced its results for the first quarter of 2015.  In a release from the company, it stated that revenues increased 40% to $176.2 million which is the highest quarterly revenue in WWE history.  The results exceeded analyst expectations for the company.

After five consecutive quarters in the red, it’s the first quarter where the WWE has shown a positive operating income.  As for the WWE Network, it reached 1.3 million total subscribers, a benchmark it announced the day after Wrestlemania.  The WWE reports that its average of network subscribers is at 927,000 at the end of the first quarter.  Again, the network’s free promotion, which was February this quarter, contributed to the Network’s growth as 154,000 subscribers converted from free to paid subscribers.

For its quarter ending March 31, 2015, it reported net income of $9.8 million ($0.13 per share) as compared to a net loss of $8.0 million ($0.11 per share) in the first quarter last year.

According to Chief Strategy & Financial Officer George Barrios the positive financial results were “driven primarily by the escalation of our [WWE] television rights fees and the expansion of the WWE Network subscribers.”

The WWE indicated that it will implement a five-part strategy the rest of 2015 for the Network.  This includes 1) creating new content; 2) implementing high impact customer acquisition and retention programs; 3) introducing new features; 4) expanding distribution platforms, and 5) entering new geographies.

As for the rest of WWE business, each division, except WWE Studios ($1.5M vs. $4.3M) is up over this quarter last year.  The total net revenues for this quarter were $176.2 as compared to $125.6 at the end of the quarter for 2014.  The Network segment, which includes revenue generated from Network and PPV increased $19.2 million from the prior year quarter.  The Network alone generated $28.6 million in revenue based on an average of 927,000 paid subscribers.

At the time of this writing, WWE stock is down slightly at $14.16 per share.

Payout Perspective:

A good quarter for the WWE.  Beating the analyst expectations is a good achievement by the company.  Wrestlemania was the likely key driver here especially when you look at the number of converted free to paid subscribers going into March, which was Wrestlemania month.  Of course, we do not know how many dropped the network in April.  We will see if the WWE can continue its positive momentum and see if its strategy for the network continues to net subscribers.

WWE hit with another head injury lawsuit

April 10, 2015

Another head injury lawsuit has been filed against the WWE by former wrestlers claiming that the company did not disclose information regarding traumatic brain injuries as well as its “egregious mistreatment of its wrestlers.”  The lawsuit was filed Thursday in the U.S. District Court for the Central District of California.  It is the fourth lawsuit within a year filed by former WWE wrestlers.

Previously, William Albert Haynes II ( Billy Jack Haynes) filed a lawsuit in Oregon, Vito LoGrasso and Evan Singleton filed a lawsuit in Philadelphia and the widow of Nelson Lee Frazier filed a lawsuit in Tennessee.

The lawsuit filed Thursday involves Russ McCullough, Ryan Sakoda and Matthew R. Wiese.  All three wrestlers reside in Southern California according to the Class Action Complaint.

There are seven causes of action in the Complaint including Fraudulent Concealment and Failure to Disclose or Warn and Negligence.  The lawsuit also includes a claim of the violation of the California Unfair Competition Law.  Essentially it’s a state action related to the WWE’s alleged misrepresentation/concealment of information related to “head impacts and related injuries” which were associated with performing at WWE events.

This lawsuit was filed by San Francisco-based Class Action law firm of Audet & Partners.  It requests that the lawsuit be considered for class action status.

A copy of the lawsuit is here via @indeedwrestling.

Payout Perspective:

MMA Payout will keep you posted as the class action lawsuits against the WWE mount.  Although we have yet to read the full 47 page Complaint, it appears to mirror the other lawsuits (specifically the Haynes lawsuit including pics embedded in the pleading) filed with respect to the WWE’s alleged failure to warn and/or disclose information about head injuries to its contracted performers.  It appears that this pattern of class action lawsuits may be similar to what the NFL and NHL have seen in recent years.

WrestleMania 31 sets gate record, attendance record for Levi’s Stadium

March 30, 2015

The WWE announced an attendance and gate record for Wrestlemania 31 from Levi’s Stadium in Santa Clara, California.  In a press release it indicated that it grossed $12.6 million with an attendance of 76,976.

It was the 5th highest attendance figure in Wrestlemania history.  It also set a mark for attendance at Levi’s Stadium (previously 70,799 for the first regular season game for the San Francisco 49ers).  Wrestlemania 29 at MetLife Stadium in 2013 had the previous record for highest gross with $12.3 million.

For the Bay Area, Wrestlemania served as preparation for Levi’s Stadium to host Super Bowl 50 next February.

Payout Perspective:

The company’s annual event proved once again why cities vie to host WrestleMania each year.  All of the events during the weekend surrounding Sunday’s show also provided a great influx of revenue to the Bay Area economy.  Many fans make it an annual trip and local businesses benefit.  While the attendance figure might be skewed, and as Dave Meltzer pointed out, the attendance record for Levi’s Stadium will likely be eclipsed by Super Bowl 50 next year, it still shows the continued popularity of the event.  Even though the WWE has received criticism over the build of this show, it pulled off one of the best shows in Wrestlemania history.

Rousey makes appearance at Wrestlemania

March 29, 2015

Ronda Rousey made a special appearance at Wrestlemania 31 in Santa Clara, California at the WWE’s biggest event of the year.  Rousey and The Rock appeared in a promo with Triple H and Stephanie McMahon which was signed off by the UFC.

Rousey actually got physical in the WWE ring as she gave Triple H a judo throw and grabbed McMahon’s arm and performed an arm crank and then “rag dolled” her around the ring.

According to MMA Fighting, The Rock and Rousey share the same agent.  The appearance was likely part of a promotion for “Fast and Furious 7” which both make appearances in.

It was clear that the UFC had agreed to her participation at Wrestlemania.  Rousey is a big wrestling fan and was in the front row of the event with the other three “Four Horsewomen.”

Payout Perspective:

It was definitely a Wrestlemania moment with arguably the UFC’s most popular star in a WWE ring.  Who said that the two audience demos are not the same?  Even though the physical altercation was minimal, it’s still surprising that the UFC allowed this to happen.  But, since Rousey is a big wrestling fan, it was probably something the UFC let her to do.  I doubt she appears in a WWE match while still under UFC contract without some sort of monetary exchange.

I realize that this is not her first physical involvement at a wrestling event as she did what seemed to be an unrehearsed weak chop on a wrestler at a PWG show late last year.  The Wrestlmania appearance was a way to promote Rousey and the Rock (who hosted SNL Saturday night) at the same time on one of the most viewed platforms (Wrestlemania) of the weekend.  It will certainly grab some mainstream interest on Monday.

WWE-Tapout announce joint venture

March 25, 2015

The WWE and Authentic Brands Group, LLC (ABG) announced a joint venture with Tapout as the brand formerly tied with MMA and the UFC will now be the official fitness and training partner of the WWE.

The partnership is reported as a 50/50 joint venture per the Sports Business Journal.  According to the WWE release, it will integrate Tapout across WWE’s global platforms including TV programming, the WWE Network, pay-per-view broadcasts, live events, digital and social media.

As one might expect, the WWE will create advertising and marketing with its Superstars and Divas outfitted in Tapout gear.  It will also be prevalent through the WWE Performance Center in Orlando, Florida and all “performers, trainers and staff” will don the Tapout workout gear.

The Tapout brand is described as “a newly repositioned fitness lifestyle brand” in the press release.  More from the press release regarding Tapout:

The next generation of Tapout™ preserves the original brand essence and drives a hard-body, fitness-centric message positioned around motivation, discipline and determination. An all new line of men’s and women’s performance apparel and accessories will launch at retail in Spring 2016. New Tapout™ branding and packaging will roll out in key categories throughout 2015 starting with beverages, supplements and fitness centers.

Payout Perspective:

There were many rumors about the partnership and the official announcement coincides with Wrestlemania week.  Although not the same as the UFC-Reebok deal, it accomplishes the same premise of partnering with brands in an effort to increase audience and revenue.  With the fitness industry apparently expanding, the WWE and Tapout will seek to make a dent into the market as well.

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