What happens next with Vince McMahon and WWE is up to the “real” media

The irony is that mainstream media reporters are asking wrestling media people in recent days how the inquiry surrounding Vince McMahon will play out. It’s those interviewers themselves, their colleagues and editors, who will determine the outcome — more than WWE’s Board of Directors and its arcane means of corporate governance.

If you’re a wrestling fan you’ve probably encountered a non-fan who first learns about your affinity for this strange medium that overlaps sport and drama, and jocularly asks you after a knowing pause, “You know it’s fake, right?”

It must be you who doesn’t know where the line is between fantasy and reality.

I learned in the last few days the opposite is true. It’s the non-fan, the rest of the general public that’s not making that distinction when it comes to pro wrestling.

I’m reminded, too, of the question from a member in the studio audience at the end of the 1992 episode of the Phil Donahue Show about sexual misconduct in the WWF.

After sitting through details of numerous allegations, she was compelled to ask:

“Isn’t wrestling fixed anyway?”

Maybe she thought what she was seeing was part of a fictional wrestling storyline. Maybe she thought that because the subjects were involved in pro wrestling it was worthy of no moral or legal scrutiny anyway. I don’t know.

Revisiting that moment in Between the Sheets’ review of the “Titangate” scandals of 1992, I figured there must’ve been some progress in the 30 years since.

I was too optimistic.

Wrestling is still seen as tacky fake-sport and society can’t get past its fixation on that quality even in the face of serious misconduct by WWE’s billionaire CEO.

CNN anchor Jake Tapper opened a two-and-a-half-minute segment on Friday about Titangate 2022 with the kind of punny play on words that frequently undermines the sincerity of mainstream coverage on wrestling.

“From out of the ring to on the ropes,” Tapper teased, alluding to Vince McMahon’s latest scandal.

CNN correspondent Jason Carroll narrated: “The wrestling world” is “waiting to see how this real world match will end.”

The short segment was spliced with B-roll of goofy highlights from Vince McMahon’s onscreen career: getting his head shaved by Donald Trump, ripping apart his tank top in the ring.

Tapper scoffed, “Of course he is,” when Carroll informed him that Vince would appear on that night’s Smackdown.

Vince’s Smackdown live address on Fox later that evening was a ratings hotshot and sadly effective piece of public relations. The broadcast showed WWE fans cheering on Vince regardless of the Wall Street Journal’s reporting of his alleged improprieties. Vince baby-faced himself to the Minnesota crowd, growled a few of his well-developed buzzwords, didn’t so much as allude to the Board’s investigation, and slapped hands with fans on the way out.

The rest of mainstream media’s reporting on the story is with a similar surface-level reading as the CNN piece, spreading WWE’s message crafted in the Friday morning press release: “Vince McMahon steps down”.

But what did he really step down from? Less attention is being paid to the fact, stated in the joint statement from WWE and its Board, that Vince will remain head of creative, the role he’s been most active in, as more traditional corporate duties in recent years have instead increasingly been overseen by President and Chief Revenue Officer Nick Khan and others.

Vince will at least temporarily stop serving as CEO and Chairman until the Board completes their investigation. Stephanie McMahon serves in those roles in the interim.

But are those changes in title-only? Or — to make another one of these obnoxious puns — is Vince’s withdrawal as CEO and Chairman no more real than the action in the ring?

I’ve yet to come across any mainstream scrutiny into that subject beyond CNBC’s Alex Sherman’s tweet on Friday.

Fellow members of wrestling media and I have been called on this week to bring some background and insight to this story in guest appearances and sound bites. We’re asked to predict what’s next. Journalists at “real” news publications ask those who cover the “fake” world to report from the future about cultural icon Vince McMahon’s destiny.

But whether Vince McMahon, John Laurinaitis, and possibly others are held to account for their alleged transgressions depends largely on whether mainstream media reports as seriously and persistently on this “fake” world like all the “real” industries they manage to report on without puns or silly video clips.

WWE’s Board of Directors will feel much more comfortable to mildly reprimand Vince and restore him officially as CEO and Chairman if the public doesn’t care or isn’t aware of the story.

WWE’s institutional shareholders will be more tolerant of the idea of having accused sex pests for a CEO and Chairman and Head of Talent Relations if that’s a notion the average person isn’t more than vaguely informed about.

Business partners and sponsors will be less bothered about cooperating with Vince’s company if the public doesn’t have enough information to question those brands’ association.

The Board’s independent members are current or former executives in media and other businesses. Some, like Barstool CEO Erika Nardini, may be all-too familiar with downplaying alleged sexual misbehavior of men like Vince McMahon or Dave Portnoy.

The Board’s oversight will be more trustworthy if there’s competent scrutiny of whether Friday’s announcement is anything more than that. Wrestling reporters will report, but our work, indiscriminately labeled that of ”the dirt sheets” and dismissed as part of a “vocal minority” will certainly not be enough.

If you’re a non-wrestling fan reading this — or even a member of the more prestigious non-wrestling media — you’re among those who have some real influence in how this unfolds. And unlike WWE’s executives or its Board or its business partners or shareholders, you’re lacking incentives to protect a powerful billionaire.

Even though it’s fake pro wrestling, this story — you know it’s real, right?

Will WWE sell? Maybe

I’ve often been dismissive of suggestions that Vince McMahon would ever part with controlling interest of his company. Sure, he cares about making money, I’ve argued, but wrestling’s most infamous micromanager would never part with control.

Plus, succumbing to merger or acquisition would end the lineage of a family-owned business that traces back to his grandfather. Given Vince’s fascination with talent who are the descendants of his former stars, passing the business to the next of kin seems like something that’s broadly part of his philosophy.

But the last signal that the Logan Roy of pro wrestling will hand the business on to the next generation of McMahons seemed to fade when Stephanie McMahon curiously announced her leave of absence on May 19, saying she would return after “taking this time to focus on my family.”

The notion that Vince pushed Stephanie to take a leave of absence, reported by Business Insider, has been has been disputed by Fightful.

Around the time of Stephanie’s announcement, Vince removed Claudine Lilien, Head of Global Sales and Partnerships, we’ve confirmed, who worked under Stephanie, related to frustration with the performance of WWE’s advertising and sponsorship sales. Improving those sales is a growth opportunity analysts have repeatedly cited.

WWE announced yesterday the hiring of Catherine Newman, formerly CMO for Manchester United, as new EVP and Head of Marketing. She’ll take over many of Stephanie McMahon’s duties while she’s absent.

Whatever the full story is behind Stephanie’s absence, with her away at least temporarily, I’m less confident than ever WWE will be led in the future by a McMahon other than Vince.

Vince’s oldest child, Shane McMahon, once the presumptive heir, left his executive role in late 2009. Despite returning as a performer, he hasn’t held a corporate role since.

“It stopped being a collaboration and it stopped being fun,” he said years later in an interview about his exit from the company.

“I wasn’t going to allow a deteriorating business relationship affect our personal lives, and that’s exactly what was happening.”

Stephanie and her husband Paul Levesque seemed to be filling the vacuum left by Shane through the mid-2010s.

Levesque was the leader behind the emerging NXT brand. His role was reduced around the time he had serious health problems last year, but also after it was clear NXT was succeeding neither at becoming a lucrative media rights brand nor at beating AEW in head-to-head Wednesday night TV ratings.

Vince alluded to difficulties working with family members in a rare interview with WWE on-air commentator Pat McAfee in March.

“Hopefully if you’ve built something, hopefully you want it to continue on and prosper and grow, whether that’s with a family member or without a family member, because my view is the business is best for everybody, whether you’re a part of it or not a part of it, and you have to treat it as such,” Vince said.

“You have to be objective and look at family members or whoever it is just like you would other employees. And quite frankly I’ve probably expected more out of my family members, which is probably not the right thing either… But you have to do the right thing for the business, so if this person is not working out, they shouldn’t be a part of the company.”

Meanwhile Vince has re-elevated past aides, Bruce Prichard (who Stephanie fired in 2008) in Creative and John Laurinaitis in Talent Relations. Long-time political rival to Stephanie and Paul, Kevin Dunn, seems as secure as ever. His Television department was merged with the former Advanced Media Group last year, with Dunn winning out over EVP Jayar Donlan, despite Donlan getting recognition like being included in Sports Business Journal’s Forty Under 40.

With a McMahon family successor unclear, not only is it believable WWE could sell, it’s at least as plausible there’s a willing buyer.

Sports rights fees in the U.S. continue to grow across the space, including for WWE’s Raw and Smackdown programs. I’ve put the base expectation for renewal at 1.5x over the current average annual value of about $470 million for the two programs combined. Current terms expire in September 2024. Add another $200 million annually for the value of the deal that puts WWE’s tentpole events and video library on Peacock, which expires in March 2026, and the total value per year for much of the company’s content comes to $670 million — currently. Assume all those rights are due for a 1.5x raise and the cost to distributors comes to almost exactly $1 billion per year.

Profitable cable businesses of companies like Comcast will likely continue to erode, contrasted by uncertainty over whether streaming can fully replace those profits.

Now is the time for media companies to consider acquiring their sports content providers — while they can still afford it and before those fees multiply further, and with that, the value of the related companies. For now, WWE’s market capitalization is about $5 billion, maybe still small enough to be acquired by a major media company like Comcast.

Comcast subsidiary NBCUniversal already holds domestic rights to a bulk of WWE content: weekly flagship show Raw, monthly peak events formerly sold on pay-per-view, developmental program NXT, and unscripted series Miz & Mrs. Universal Studios could benefit from what WWE won’t hesitate to remind you is their wholly-owned intellectual property, as WWE president Nick Khan pointed out a few months ago. Smackdown, currently broadcast on Fox, could certainly find a well-suited home somewhere in the NBCU family, if not return to the USA Network, where Smackdown was televised until 2019.

Given NBCU’s deep investment in WWE content currently and relative lack of intellectual property, Comcast seems like the likeliest candidate to acquire the wrestling company.

Khan, who would likely lead negotiations of any deal to sell WWE, has been non-committal on the subject publicly, but clearly recognizes how WWE’s assets could be a fit for NBCUniversal.

“As we say, we’re open for business,” Khan said in an interview on The Town podcast in March.

“So if you look at, what does NBCU/Comcast lack that they need? And I think it’s a factual statement: they don’t have the intellectual property that some other companies have. They certainly don’t have the Disney treasure trove of IP, nor should they.”

But Comcast has a Chairman, CEO, and preferred class shareholder of its own, Brian Roberts, who would have to approve of any deal to acquire WWE. Analyst Brandon Ross mentioned in a recent episode of the LightShed podcast his team’s belief that Roberts was initially hesitant to commit to putting WWE content on Peacock.

Since WWE Network content debut on the streaming service in March 2021, though, the deal seems to have worked out well for both sides. WWE is among the most popular content on Peaock and the former pay-per-views have never been more highly-viewed, coinciding with the stabilization of a number of consumer metrics for WWE that previously were in consistent decline.

Maybe Roberts has warmed up to the WWE brand, but it’s unclear how willing Comcast would be to acquire a pro wrestling company and the hazards that come with it. Does a major media company want to oversee an entity with WWE’s track record of scandal and perhaps future issues like worker misclassification? Vince would likely insist on Dana White-like continued autonomy over WWE as part of any sale. What would it be like overseeing the CEO, who hasn’t answered to anyone in decades beyond passive shareholders and fans whose discontents have largely been dismissed?

Would parent company executives who inherit WWE understand this peculiar industry well enough to install effective leadership when Vince is no longer around? Turner Broadcasting and its successor Time Warner struggled to do so for WCW in the 1990s and that wrestling company failed. But those were different companies at a different time with different executives. Would WWE succeed under a parent company in the 2020s? Maybe.

Disclosure/disclaimer: I do not currently nor have I previously held positions in WWE stock (NYSE: WWE). I have no plans to initiate any such positions. I do not hold positions in any other companies mentioned in this article. This article expresses solely my personal opinions. The opinion expressed here is not and should not be construed as financial advice.

Brandon Thurston has written about wrestling business since 2015. He’s also worked as an independent wrestler and trainer.

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Power dynamics in wrestling are shifting

The great author, Alice Walker, once said, “The most common way people give up their power is by thinking they don’t have any.” 

For over 20 years, WWE has held supreme power in the North American wrestling scene. In those 20 years, WWE has been able to cultivate what looks like subservience from both fans as well as wrestlers who work in the company. 

The relationship between business owners and workers is mutually symbiotic. A worker is hired to do a service, the worker is compensated for the service, and a mutually agreed upon payment is rendered to the worker. This in itself is a contract and, contrary to what some might believe, an employer is not doing a one-sided favor by giving someone a job, both sides benefit each other.

Enter Sasha Banks and Naomi. Both of these women are, as of this writing, “independent contractors” for WWE. There’s a great deal of speculation about why they decided not to work the May 16 edition of WWE’s Monday Night Raw, but we haven’t heard from them directly yet.

A mere two weeks later in All Elite Wrestling, MJF, no-showed a fan fest in Las Vegas prior to AEW’s Double or Nothing pay-per-view event and it led to speculation that he would no-show the pay-per-view, itself. Of course, he did show up and wound up on the receiving end of a symphony of powerbombs from Wardlow and was then stretchered out of the arena. Then, on the June 1st edition of AEW Dynamite, he cut a worked shoot promo on Tony Khan and what he deems as Khan’s bias toward former WWE wrestlers.

So within a calendar month we have two different instances of wrestlers making defiant power plays and the wrestling media seems to be concerned with who’s right and who’s wrong. I am more into the business psychology of what is going on in wrestling and what it might mean for the future.

I want to start with Sasha Banks and Naomi, real names Mercedes Varnado and Trinity Fatu. This is a layered situation and no one in the wrestling media can give a definitive reason as to why they left. We do have WWE’s one-sided account of the events in question and their statement reads as follows:

“Even though they had eight hours to rehearse and construct their match, they claimed they were uncomfortable in the ring with two of their opponents even though they’d had matches with those individuals in the past with no consequence. Monday Night Raw is a scripted live TV show, whose characters are expected to perform the requirements of their contract. We regret we were unable to deliver, as advertised, tonight’s main event.”

This public display of disdain is usually frowned upon in the business world. So much that most companies will not even provide negative references for former employees out of fear of possible litigation. Maybe because WWE wrestlers are technically not employees of WWE and the contracts they sign state that they are independent contractors, perhaps this is the reason why WWE feels they can be this brazen with their online and on-air rebuke of two of their wrestlers.

Some in the wrestling media are very quick to say that Sasha and Naomi were unprofessional, and leaving right before an episode of Raw is inconsiderate. I have even heard some emphatically state that Sasha and Naomi’s refusal to “do business” has nothing to do with race or gender. As someone who has followed the WWE product closely since I was a small child, I feel very uncomfortable definitively stating that. I mean, Vince McMahon is the same guy that made Trish Stratus bark like a dog in 2001 while thousands in the arena cheered him on, and the same man who I witnessed on TV use the n-word with a smile on his face in 2005. It is for these reasons and many more that WWE does not get the benefit of the doubt with me.

In business psychology, an entity or person with expert power is defined as one who possesses knowledge or expertise in the field that they work in. It matters in 2022 because WWE is arguably no longer a monopoly and has a legitimate disrupter to their business in AEW. 

One of AEW’s biggest criticisms is their women’s division and additions to their roster like Sasha and Naomi would seemingly complete their women’s division. Perhaps, Sasha or Naomi would not be as bold as they are if AEW did not exist, maybe they have their sights set on Hollywood, or maybe they have just reached a point in their careers where they feel that they are not only defined by what they do in the squared circle.

Maxwell Jacob Friedman’s story is slightly different but the same in a myriad of ways. When MJF signed with AEW in the company’s infancy, he was not as well-known as he is today. As AEW proved itself to be legitimate competition to WWE, it began to attract bigger names and it is assumed that MJF, perhaps felt that his current contract was not matching what he brings to the table.

While I have not always been a fan of MJF and some of his low-hanging fruit promos, I can’t deny the value he brings to the table, and, like Sasha and Naomi, I am sure that he will be able to find greener pastures should he decide that AEW is no longer a good fit for him. 

The event that MJF no-showed was an AEW fan fest. We couldn’t find the original pricing info since the event has already passed, but I recall right, it had a $54 ticket price, plus if you paid upward of $100 you were able to participate in a meet and greet with stars like MJF. Not only did MJF not show up for the fan fest, Fightful reported (subscription required) that he had a plane ticket in his name to fly out of Las Vegas, with the assumption being that he might skip Double or Nothing. We all know now that obviously didn’t happen.

Sasha, Naomi, and MJF’s situations are proof that the power dynamics in wrestling have shifted. Nearer to a monopoly in prior years, WWE had free rein to create their own vision for what they deemed sports entertainment. If WWE did not see value in Sasha and Naomi, or if AEW did not see the value in MJF, I am fully convinced that those wrestlers would have gotten kicked to the curb a long time ago.

This is only the beginning for such power plays for wrestlers. MJF rose up the ranks in a new company and has proven and recognizes his value. When he started off in wrestling he needed AEW. Now that he is an established name, he can bring his name and value to WWE. Likewise, Sasha and Naomi understand that if they are not feeling creatively fulfilled, there is an AEW that they can go to and perhaps thrive in. The power dynamics in wrestling are shifting. In a competitive wrestling industry, talent will recognize their power and need not think that they don’t have any.

Kristoffer Ealy is a political science professor and business psychologist with a Ph.D. in Organizational Leadership. He co-hosts the Nubian Wrestling Advocates podcast on POST Wrestling.