Dave Meltzer is reporting in the latest edition of the Wrestling Observer Newsletter that WWE would have been more profitable had they stuck with the traditional pay-per-view concept.
Brandon Thurston did a report for The Wrestling Observer utilizing Google Trends to extrapolate how WWE pay-per-views would have done since the inception of the WWE Network. Thurston studies the economics of pro-wrestling.
According to Thurston, WWE would be less profitable for their Sunday Night specials either way. However, based on the numbers, they would have made more money by charging $60 per show as opposed to the $9.99 a month.
WWE has accepted losses by using The Network for major shows. However, they claim they do better on the regular monthly shows.
Generally speaking, WWE gets 1.5 million subscribers at $9.99 vs. a projected 150,000 purchasers at $60 for their non-major shows. The issue is actually a matter of profit margins.
WWE has more cost associated with shows on the network compared to pay-per-view. So, they don’t make as much per viewer.
When WWE launched the network, they expected to have close to 4 million subscribers at this point. The 1.5 million has to be considered a major disappointment.
WWE has lost a huge amount of its audience over the last few years. The good news for WWE in terms of profits has been the TV rights going up as much as they had.
The TV deals have offset any losses they would have experienced by loss of revenue from pay-per-view. Of course, if you need to increase profits and revenue, you can always make a deal with a Prince who will pay you millions to have shows in his home country.
With the changes coming to the network, it will be interesting to see at what point the hardcore WWE fans will have to deal with pay increases to watch shows like WrestleMania.