WWE News: 5 Questions Investors Should Ask Vince McMahon About WWE's Business

Lost in the hysteria created by Christian's sudden World Championship turnover was WWE's underwhelming first quarter 2011 earnings results. 

Problems that have plagued WWE for years have contributed to its currently slumping business, and Vince McMahon hardly did a sufficient enough job answering prudent, yet misinformed, questions regarding WWE's business going forward. 

McMahon seems to be working his investors, as the WWE Earnings Press release emphasized new stars, despite the fact that WWE's booking has sabotaged a handful of upstart careers. 

Common sense dictates that investors who follow WWE need to follow the product as if they were so-called insiders, yet for whatever reason, these shareholders seem to be content with McMahon's quarterly insufficient blanket statements pertaining to new stars and growth. 

A handful of questions should come to mind when it comes to WWE's short-term and long-term plans; however, those in position to ask them do not seem capable given their rather general knowledge of the pro wrestling product. 

Big Nasty is a contributor to FightLife Magazine.  Follow him on Twitter @ThisIsNasty.

1. WWE's Commitment to New Talent Initiative

Question No. 1: According to WWE's Earnings press release, WWE is committed to 'new characters with broad appeal', yet the upstart careers of many new characters seem to be prematurely discarded.

Wade Barrett, Sheamus, Kofi Kingston, and Jack Swagger are all examples of new characters who received emphasis only to be de-emphasized.  It now appears as if Alberto Del Rio, who you've specifically mentioned as a budding star of the future, is regressing back to a feud with Rey Mysterio which is where he started in WWE.

Given the continual de-emphasis of otherwise promising new stars, why should I believe that WWE is fully committed to new stars?

This is a question that was barely touched upon by an investor, despite WWE's continual promises of creating new stars.  WWE has shown ambition in pushing fresh faces into the main event, but they have not held up their end of the bargain in finishing what they start.

Pushing new stars, only to cut them off prematurely, is far more damaging than not pushing them at all.  In essence, this disturbing pattern defeats the purpose of creating new stars in the first place. 

2. WWE's Commitment to New Talent Initiative (Cont.)

Question No. 2: 2010 Saw first time world champions in Sheamus, who captured the WWE Championship, and Jack Swagger, who captured the World Championship.

Fast forward to 2011, where the WWE Champion is John Cena, now a ten-time world champion, and the World Champion is Randy Orton, now an eight-time world champion.

How is WWE going to effectively fulfill its new star initiative if veteran talent continue to triumph at the expense of newer, fresher faces?

No matter how committed it may be to a new star initiative, Vince McMahon and WWE are always prone to resting on their laurels.

Seeing WWE's top two stars over the past decade remain at the top of the food chain is certainly an alarming sign, and should have immediately triggered a question similar to the one above the minute McMahon began discussing WWE's ongoing new star initiative.

3. WWE Studios' Business Model

Question No. 3:  WWE Studios has now lost money for two consecutive quarters.  Given the low-budget nature of WWE's movies leading to lackluster box office sales, would it be more efficient for all movies go straight to DVD rather than debut in theaters for limited releases?

WWE has continued to tweak its formula for WWE movies in order to operate more efficiently.  Limited releases, and WWE Superstars in supporting roles are among the strategies WWE has utilized in making its movies more profitable, however WWE Studios has losses in two consecutive quarters.

More work obviously needs to be done to revamp WWE Studios; however, it would be fair to question WWE Studios' long-term viability.

4. WWE Pay-Per-View Revenue

Question No. 4:  WWE's pay-per-view business has been shrinking for years.  With WWE giving away pay-per-view worthy matchups, like Christian vs. Orton this past week on SmackDown which featured a World Title Change, doesn't this further damage WWE's potential to recover at the box office?

WWE's pay-per-view business has taken a hit in the era of UFC and week-to-week TV ratings.  The key is finding a happy medium as to what they're willing to show on TV and what they showcase on pay-per-view, and yes that means taking a hit in the ratings.

As long as WWE remains overly concerned with largely cyclical ratings, their pay-per-view business will continue to take the hit.

5. WWE Pay-Per-View Revenue (Cont.)

Question No. 5:  WWE has recently featured gimmick pay-per-views in a move to stimulate its pay-per-view business, however pay-per-view numbers continue to decline, and in some cases, pay-per-view revenue has dipped exponentially compared to results in prior years.

Couldn't it be theorized that these gimmick pay-per-views are contributing to the problem, as WWE becomes limited creatively thus unable to showcase more organic feuds?

WWE's gimmick pay-per-views have shown to be a terrible solution to an alarming problem.  With pay-per-views like "Hell in the Cell" and "Tables, Ladders, Chairs" being featured, the gimmicks themselves lose meaning as WWE books gimmick matches for the sake of fulfilling pay-per-view commitments.

Big Nasty is a contributor to FightLife Magazine.  Follow him on Twitter @ThisIsNasty.