3 Big Dilemmas WWE Network Must Face

The WWE continues to drive towards a million subscribers for their domestic WWE Network. At the same time, WWE is preparing to launch international versions of the WWE Network by the end of 2014. However, they€™re facing some enormous obstacles: What should they do if demand proves to be stagnant and how will WWE retain subscribers? In short, What happens if the Network stops growing? In the latest €œWWE Business Outlook€, WWE suggests that at a €œsteady state€ of between 1.2M and 1.3M global annual subscribers, that will produce approximately $40M in OIBDA (Operating Income Before Depreciation and Amortization) which would supplant the lost OIBDA that previously was generated by the Pay-Per-View segment. As I calculated in my previous piece, achieving that goal may be a lofty task, even assuming a worldwide audience. (The reality is that no one, not even WWE, has a clue what the global demand for their service is going to be.) I believe that eventually WWE will be faced with three dilemmas: 1. Find a way to expand the number of subscribers (Grow Demand) 2. Generate more Revenue from existing subscribers (Raise Price) 3. Create efficiencies to produce higher profit per subscriber (Cut Costs) Let's look at each of these dilemmas in more depth...