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WWE News: Report on WWE's conference call with investors - serious discussion of WWE TV, Vince McMahon: "This is not a Family Business"
Nov 5, 2009 - 10:29:02 AM
WWE hosted their quarterly conference call with investors this morning with the top stories coming out of the call being heavy discussion of WWE TV, Vince McMahon claiming WWE is not a family business, and WWE sharing a new Films Division strategy. The following are key highlights from the conference call.
-- On the prospect of a WWE TV Network: WWE executives said they are in the "preliminary evaluation stage" of the new TV channel. However, the tone of their comments was firm that they intend to launch the channel and they are not just throwing out a pie-in-the-sky idea.
WWE believes it will "generate significant economic return" and most of the programming will be compromised of using the old-school footage they have in their tape library.
One analyst called in complaining about a lack of old-school footage used on WWE programming. WWE COO Donna Goldsmith took umbrage with that statement and said WWE has used the footage on recent DVD releases, but WWE intends to use the footage on the new WWE TV Network whenever it's launched.
"We're just starting to put the business plan (for WWE TV) in place, but we will be using that footage. Stay tuned, as there will be even more usage," she said.
-- WWE CEO Vince McMahon opened the conference call declaring, "I think we had a relatively good quarter." McMahon said he uses two barometers to determine the success of business in terms of whether people are interested in the product - live event attendance and TV ratings. The consistently weak PPV business was not included in the "McMahon Barometer."
McMahon and executives talked about live event attendance being strong after lowering ticket prices to bring more people to the arenas. McMahon said it captures the strength of the WWE brand that people are willing to spend money and effort on parking, hot dogs, merchandise, etc. as part of the event-going experience.
-- Vince McMahon also used his opening remarks to make a speech about his family. "Some people perceive this to be a family business, but I do not," McMahon said with heavy emphasis on "I do not."
McMahon, the CEO of a publicly-traded company, gave an endorsement to his wife, former WWE CEO Linda McMahon, for her Senate run in Connecticut. "For those of you living in Connecticut, you might want to vote for her," he said. "We've lost Linda in terms of her CEO role, but I think she still sits on the board."
McMahon also mentioned Shane McMahon's departure from the company. "Shane has decided to pursue other opportunities in the marketplace," McMahon said matter-of-factly. He followed up that the strength of WWE's management team is based on performance, not if an employee's last name is McMahon.
McMahon's comments on WWE "not being a family business" seemed to be a clear message that no McMahon is bigger than the company following the departures of Linda and Shane. It remains to be seen if WWE executive Stephanie McMahon will be scrutinized more closely on her performance when it seemed she was set for life as head of creative.
-- WWE discussed a "revised film philosophy and practice." They will be doing small-budget films of $5.0 million per movie with a new method of distribution. WWE was vague on exactly what they will be doing differently, but they plan to have "greater control" over film distribution.
"If you want to buy stock in terms of just the film business, this is not the company to be associated with," McMahon said. WWE executives added later on they intend to have "limited theatrical releases," which implied a heavy dose of straight-to-DVD offerings on the $5.0 million budgets.
"We expect to produce returns significantly higher than films released to date," WWE said.
-- WWE did not specifically address their PPV business continuing a steady decline each quarter, highlighted by Summerslam 2009 falling off nearly 50 percent from 2007. Instead, WWE ignored the declines and told investors to look at the Hell in a Cell PPV, which was not included on the third quarter results since it took place just one month ago.
"We continue to stabilize PPV business," said WWE CFO George Barrios. "Early returns on Hell in a Cell indicate year-over-year increase of 11 percent." Send feedback on this article to pwtorch@gmail.com and we'll regularly publish reader feedback in the "Torch Feedback" category on the Main Listing.
