3 Big Dilemmas WWE Network Must Face

1. Cut Costs

While top line revenue may stay the same, WWE can still embark on a far-reaching crusade to cut costs. That would improve gross profits. In the effort to €œramp up€ the WWE Network quickly (something that started a television channel and ended up as an over-the-top service), there€™s no doubt that some decisions may have been expedient but not cost-wise. WWE has already fired Matthew Singerman (the Executive Vice President of Programming and head of the WWE Network). Will there be more executive changes in the near future? Will WWE further cut back on accessory programming costs? That could include things such as eliminating pre- or post- shows coverage. Or they could reduce investment in new show production (such not making another season of a reality series like Legends House). Will WWE find a way to shift or defray some costs? Perhaps they'll add advertising to the WWE Network (something that CFO Barrios admitted they've concerned but they have not yet built into the projected financiasl). They could even reduce the level of customer support or bandwidth redundancies if they had a sure read on how many subscribers they're going to have long term. Will WWE find an appropriate partner where they can share some of the burden of costs? It's possible that the international expansion will involve Pay TV partnerships. After all, to quickly roll out the WWE Network they need to also navigate the complex TV Rights and PPV contracts they've already signed overseas. WWE could even choose to limit which applications they'll use for distributing the WWE Network. Yes, it'll hurt them to prevent customers from using AppleTV to watch the WWE Network but it will also save them from having to split the revenue with Apple off new subscriptions. Whenever you're slashing the budget, everything is a trade-off. Right now, without clear WWE Network leadership in the WWE Network and WWE Digital Media divisions, I'm not sure what major strategies will pursue. It's possible that by targeting a lower number of stable WWE Network customers (but charging each of them more), WWE will be able to run a more efficient WWE Network than one with a huge, always-changing customer base. That's, in a nutshell, WWE€™s Network Dilemma.