MR. TITO: Why the WWE (or TKO) Should AVOID Warner Bros. Discovery for Monday Night RAW

Right now in the television landscape, there are rumors swirling about Warner Bros. Discovery (WBD) on two fronts… One, WBD may actually acquire Paramount Global which is the holding company that oversees ownership of both Viacom and CBS. If you go back and remember how much Disney paid to acquire 20th Century Fox, that was over $70 billion. For WBD to acquire anything related to Paramount (Star Trek franchise in particular), Viacom properties and its channels (Mtv, Nickelodeon, etc.), and a top network like CBS, it will easily cost the same amount. Where does WBD get its cash after being repeatedly acquired and sold throughout the years?

And secondly, the other rumors are about wrestling, specifically whether or not Warner Bros. Discovery opts to stick with All Elite Wrestling (AEW) and pay a lower rate to host 3 of their lower viewed shows or to pay a higher rate to host WWE’s Monday Night RAW. On WWE’s end, them obtaining WBD and possibly pushing AEW off the boat would be a major feather in their cap, ESPECIALLY if the WBD acquisition of Paramount Global becomes a reality. Why? Because AEW’s only choices would be to latch onto Disney or a popular streaming service like Amazon Prime. Disney’s standards and practices would eat AEW alive (so that’s a “no”), but Amazon would only take them if cheap as they are paying a metric ton for NFL content.

But I’m here to tell WWE, with regards to Warner Bros. Discovery… “RUN! Get out! Get out of there! Get out!”

And I’m also here to tell you about my favorite quote from George Santayana, which state those who do not remember history are condemned to repeat it.

3 facts need to be considered here:

(1) Ted Turner sold his Turner Broadcasting company to Time Warner during October 1996. It took a while for the deal to materialize, but by early 1998, Ted Turner was no longer in charge of his content and new Time Warner executives were. As Eric Bischoff and others have stated, Time Warner executives took over and forced new standards & practices that heavily edited and censored WCW’s content. Time Warner also began cost shifting Turner Broadcasting revenues and expenses, as Bischoff also has alleged.

(2) WWE’s run on Viacom was a disaster and once the deal was up, the WWE quickly ran back to USA Networks where they’ve enjoyed a steady relationship for almost 20 years now. The TNN Network that WWE was places on, later renamed to SpikeTV, was poorly managed and the Mtv relationship for Sunday Night Heat was a total joke.

(3) WWE gave FOX Networks a cost effective 2 hour product on Friday Nights that actually gained viewership with time. FOX claims it wasn’t profitable, but they aren’t releasing the numbers. Even with lower ad rates, the expenses of paying WWE for the 2 hour block versus paying a Hollywood studio for that 2 hour block were way down. FOX made money on this deal, but they just didn’t want to pay any higher than $1 billion for 5 years and they got out. WWE prematurely announcing the Smackdown deal to USA Networks caused the rage and retort from FOX.

Another quote… “Grass isn’t always greener on the other side“.

Maybe WWE ought to think about their Cable/Satellite TV channel negotiations and stick with the TV channel that made them: USA Network

Why not just double the $1.4 billion on the Smackdown deal for RAW and call it a day? Or go slightly higher with $1.5 or $1.6 billion to keep RAW on USA Network for the next 5 years?

Facts to consider about USA Network, as backed by Comcast and NBC/Universal:
• Who had WWE’s back in 1997 when ratings went lower, yet USA gave them a 2nd hour on Mondays to fight WCW?
• Who took them back after the bad Viacom deal?
• Who gave them their ridiculous deals for RAW/Smackdown for 2014 (just below $200 million per year) and for RAW in 2019 ($200 million per year)?
• Who gave them a ridiculous deal for WWE Network for another $1 billion for 5 years?
• Who gave them additional revenue possibilities on the E! Network?
• Who has always given them promotional opportunities on NBC?

I KNOW that the WWE does NOT want to place 100% of their chips for RAW and Smackdown on one channel, as the WWE likes to have Networks compete over them… Totally get that, especially as we just witness the WWE making $2 billion over the past 5 years with RAW on USA Network and Smackdown on FOX.

But consider the alternative… Warner Bros. Discovery?

1) Time Warner acquired Turner Broadcasting during 1996, which included WCW. Since that acquisition, WCW obviously died but channels like CNN have declined in relevance as other competitors challenged them. CNN is a distant third in the news race against FOX News and MSNBC, and has been largely laughed at as a joke.

2) AOL acquisition of Time Warner was a complete joke, and stripped the company even further. The AOL executives made further sweeping changes to programming that continued to decline their networks throughout the 21st Century.

3) Completely botched their intellectual properties. Think about this… If you had Batman, Superman, Bugs Bunny, all of the Hanna Barbara stuff, and many other beloved properties, it would be easy to produce new content. Nope, this company can’t even produce good Batman or Superman related films, particularly after the Nolan trilogy. The Snyder-verse has done nothing but produce dark crap that nobody wants to repeatedly see. Now, after 10+ years of pain and some recent major losses, they are rebooting the DC Comics brand once again.

4) AT&T acquisition crushed Time Warner Cable and Broadband. The real money maker for Time Warner used to be its Cable packages, but evolved into major cash for its broadband internet network. However, when AT&T acquired AOL/Time Warner, they had to sell off specific communications assets to get it approved. AT&T had its own internet offerings and just bought DirecTV the year before… Thus, to get it approved and not have anti-trust concerns, it had to sell off the Cable/Internet offerings that Time Warner once had. AT&T foolishly acquired a company whose intellectual properties were declining along with major Sports contracts.

5) Overpaying for Sports Leagues. NBA is not cheap at all, but neither is NCAA Tournaments and MLB content. They recently overpaid for NHL content that isn’t overly drawing on their channels. Honestly, if they didn’t have Inside the NBA, I really doubt their viewership for their NBA games. Since Chuck, Ernie, Kenny, and Shaq are so successful, they have to overpay for those talking heads and thus this NBA deal probably isn’t profitable.

6) Foolishly starting up HBO Max (now Max). Before, they could tell their catalog of movies and films to various channels or streaming services like Netflix. They could also convince people to buy into HBO on their Cable/Satellite programs. However, they ceased those revenue opportunities with hopes that HBO Max would outpace Netflix and generate pure subscriber money. What they didn’t realize is higher bandwidth costs of running their own streaming services versus what happens when they lose massive amounts of subscribers. Already, Discovery executives have discussed wanting to dissolve HBO Max or now Max… As you can see recently, there exists more Warner Bros. content on Netflix…

7) Discovery acquiring Warner Bros. Media from AT&T. How can AT&T complete an acquisition of Time Warner assets through 2018 and then turn around and sell it to Discover through 2022? That deal was $43 billion, which I guarantee that the Discovery folks are still paying down as debt.

8) Now, Warner Bros. Discovery may attempt to acquire or merge with Paramount Global, who has a ton of debt… So WBD, who has its own debt paybacks from multiple recent mergers, is willing to take on MORE DEBT to buy Paramount Global who has a TON OF FREAKIN’ DEBT itself? Really?

Unless the price tag is absurdly high, I’d pass on Warner Bros. Discovery if I were WWE… I just don’t see the cashflow to extend the WWE’s deal beyond 5 years, nor do I see the benefits of working with utter incompetence within WBD. Sure, they’ll let you curse more, but you won’t know who to negotiate with for your next deal. AEW found that out after Discovery acquired WBD, they pushed out all of the executives that helped make the AEW happen.

Remember, Warner Bros. Discovery is the SAME COMPANY who gave AEW a new 2 hour show on Saturday nights contingent on 1 guy appearing: CM Punk.

Think about that for a second… Yes, I consider CM Punk a draw, as proven by attendance and merchandise numbers, especially in AEW… But the viewership numbers he generated, besides his return, were like consistently under 750,000 viewers. That’s poor management to throw out $50 million to AEW based on 1 freakin’ guy. The entire brand is what you bet on, not 1 person. Since Punk joined AEW during August 2021, he has been injury prone… So at the very least, shouldn’t we question WBD executives for giving AEW $50 million to create AEW Collision based on CM Punk? Worse yet, CM Punk got into a backstage fight with AEW EVPs during early September 2022. Wouldn’t you factor that more drama could also happen?

Compare that to USA Network… Yes, they’ll limit you on standards & practices, I get that… But much of your growth and stability has been from their deals. But you should also consider what Comcast and NBC/Universal are cooking:

1) Most successful broadband service with Comcast’s Xfinity product.

2) Record profits being reported.

3) Successful movie projects recently with Fast & the Furious, Super Mario Bros, and Oppenheimer. More Nintendo projects on the way…

4) NBC was the most watched broadcast network of 2023.

5) USA Network has higher overall viewership than TNT or TBS for their programming.

The only weakness of the Comcast/NBC/Universal deal would be streaming on Peacock… That service blows and is a failure. They only have 30 million subscribers, compared to Max’s 95 million if WWE could somehow get the WWE Network onto Max. But remember, Discovery executives want to dissolve Max as a streaming service… Maybe WBD wants to do more with Bleacher Report’s streaming services? Or force Pay Per View again for WWE?

WWE should consider the facts and history behind anything associated with “Warner”. Just nothing but stench for the past 27 years since they bought Turner Broadcasting. That said, if WBD throws $2 billion for the next 5 years at the WWE, I could see WWE making the leap at the money. Money talks, and BS walks… But you cannot spell “Warner Bros.” without the letters “B” and “S”. Lots of smelly stuff has happened throughout its corporate history, as mentioned above.

The other alternative is Disney… They have the same issues as Warner Bros. Discovery, aside from being acquired or changed up every so often. Disney’s internal management would harass WWE with their squeaky clean message, but then further scrub WWE’s content to now make things extremely politically correct. But they have their money issues, too… That 20th Century Fox deal cost them $71.3 billion and suddenly, they are actually losing money on Pixar, Marvel, and Star Wars properties. ESPN is a major money loser, too, as viewership has declined for them while they are overpaying for sports leagues, too, with NBA, College Football, NFL, and also the NHL.

WWE joining Amazon? There are 220 million subscribers for their Prime services globally. That is a metric ton, but everyone is buying from Amazon. If you want to take REAL “leap of faith”, put RAW live on that streaming service and put the WWE Network there as well. Much of your 18-49 demographic either already has Amazon Prime or their wives do (mine does!). I’d think about that, and Amazon’s market share is only growing as more people securely buy things online from them. However, as mentioned above, Amazon is paying a ton for NFL content and taking on WWE stuff, and possibly hosting their network, could be expensive for them.

Otherwise, I’d avoid WBD or Disney unless the money is absurdly high… Amazon is quite enticing, but damn, the quality of service given to you by Comcast/NBC/Universal is unmatched. They have been THERE for during the tough times and financially rewarded you. Christ, they just paid you $1.4 billion for Smackdown on FRIDAY NIGHTS which is sure to go below 1 million because the show is no longer on Network television. Come on, WWE…

It’s like the WWE is a teenager in High School, who is trying entice high maintenance cheerleaders to date him. Yet, there’s this 1 girl, who is pretty herself but not flashy about it while being loyal, understanding, generous, and has always had his back… However, this WWE guy is trying to disregard that loyalty and generosity in order to get in good with a “head” cheerleader and possibly her rich parents of high society.

Like I said… The “grass isn’t always greener on the other side”.

The FACT is that Warner Bros. Discovery is speaking to the WWE, openly, while they have an existing deal with AEW. Doesn’t that show you that WBD lacks loyalty? Hell, the shareholders and executives remaining form the Warner Bros. team aren’t that loyal. They just sold themselves TWICE in the past 5 years. Now, they want to possibly acquire Paramount Global and they’ll likely axe many jobs there if acquired. Talk about loyalty…

If I were WWE, I’d give RAW to Comcast/NBC/Universal or try Amazon Prime… I’d stay away from companies like Warner Bros. Discovery and Disney who have high debt, rotating chairs on the Titanic deck for executives, declining brands, declining channels, or doesn’t have the public’s trust in their operations at the moment. If Warner Bros. Discovery truly tries to acquire Paramount Global, where will be the funds to acquire WWE Monday Night RAW for over $200 million per year or to give AEW what they need to grow? Speaking from experience, there are many, many changes to a company once a merger or acquisition occurs.

We’ll see what happens…

CLICK HERE for the Mr. Tito Column Archive @ NoDQ