The five-year relationship between WWE and Fox ends tonight with a live broadcast of Friday Night SmackDown from Edmonton, Alberta, concluding WWE’s run on one of the big four networks.
In 2018, WWE blew away expectations with the announcement of two media rights deals where Raw would remain on the USA Network at an astounding average annual value (AAV) of $265 million per year. The big “get” was SmackDown leaving the cable network for Fox in a deal believed to be worth an AAV of $205 million and totaling more than $1 billion over the five-year pact.
The planets aligned where Fox was bidding farewell to its multi-year relationship with the UFC and WWE felt like the fancy new toy that the Murdochs aimed to build its Friday nights around.
The Hollywood Reporter provided an amazing tick-tock of the negotiating period and a pivotal meeting in May 2018 in Manhattan. Leading the charge for WWE included Stephanie McMahon, Paul Levesque, former presidents George Barrios and Michelle Wilson and accompanied by CAA agent, Nick Khan.
When they walked into the conference room, they saw an enormous TV screen projecting a shot from WrestleMania 34, with wrestler Ronda Rousey lifting the 256-pound Triple H in a fireman’s carry. That photo — displayed with the Fox Sports and FS1 logos superimposed on it — served as an icebreaker for a negotiation that would last two and a half hours.
When all was said and done, WWE scored over $2.3 billion in rights fees between Raw and SmackDown and for the first time in its history would have weekly programming on one of the big four networks.
The company stock responded accordingly in the lead-up to the media rights announcements and in the months leading up to the new deals taking effect. For a stock trading under $40 before the deal announcements, it would top $90 in September 2018.
The launch date on Fox was set for October 4, 2019, and occurred during one of the most significant weeks in pro wrestling’s recent history. Weeks after NXT debuted on the USA Network, AEW would launch its weekly programming on TNT on October 2 with a show in Washington, D.C., and coming days before SmackDown would arrive at Fox.
It was a transformative moment in the industry, with a viable alternative that had procured name-brand talent, including Jon Moxley and Chris Jericho, the heart of the independent movement in the Young Bucks, Cody Rhodes, and Kenny Omega, and an owner/superfan willing to invest millions to see his vision of non-WWE wrestling finding success.
This coincided with WWE’s creative direction circling the drain and begging for change. Nothing spoke louder than the reception at that Sunday’s Hell in a Cell pay-per-view where Seth Rollins and The Fiend Bray Wyatt participated in a Hell in a Cell encounter, which was universally panned by those inside the arena, fans at home, and even those on the WWE’s own Watch Along as it played out.
But the debut on Fox was a major hit for the company. It channeled a rare appearance by Dwayne “The Rock” Johnson and built the show around a new frontier for the company and expectations that the network would channel a boom period.
During its final month on the USA Network, SmackDown was averaging a hair over two million viewers per show, and with millions of additional homes with access to Fox, it was a foregone conclusion that growth was theirs for the taking.
As always, WWE threw everything at the wall on its debut leading to over 3.8 million viewers watching the Fox launch and topping the four million mark for the opening quarter featuring Johnson. More importantly, the show did a 1.4 rating in the coveted 18-49 demographic but would settle into the range of 0.7 by November.
The sounds of AC/DC’s “Are You Ready?” hardly screamed new or innovative as the 1990 release became the soundtrack for the show’s move to Fox. What was novel, was a title sponsor for the show in Progressive Insurance, which attached its brand to the series throughout the entire run on Fox.
No one could predict the future months or have a clue of what COVID-19 was or represented but would quickly become the dominant subject affecting the world.
On March 11, 2020, the world truly grasped the severity of the disease when Utah Jazz player Rudy Gobert tested positive and attached a public figure to a subject they were only reading about until now. It increased more so when Tom Hanks of all people was infected and suddenly, the world was shutting down, and that included sports going on lock with the NBA suspending its season, the NHL dragging its feet but acquiescing to public pressure
WWE?
They had a show to run.
With a live edition of SmackDown scheduled for Detroit, WWE quickly entered crisis mode with the option of fans attending a live event becoming impossible, and canceling that week’s show was not on the list of options.
To their advantage was its property in Orlando, Florida, and the WWE Performance Center became its base of operations for the next several months as WWE continued to produce television without crowds and producing the most sterile of environments for an entertainment product.
It was a magnifying glass onto the industry where all sports leagues were bound by players’ associations and collective bargaining designed to protect its athletes while WWE had television rights fees to protect and talent less likely than ever to rock the boat. Wrestlers participated in full-on wrestling matches, trading sweat, and going untested during the first months, and would be subject to a mass set of cuts one month into the pandemic.
WrestleMania went forth with two nights of empty arena matches from the PC and all television commitments were honored and shows delivered weekly to the USA Network and Fox.
While the immediate novelty of “How will WWE pull this off?” maintained viewership at the start of the pandemic, numbers would slide as the environment became painful to observe pro wrestling in. In January 2020, before the shutdown, SmackDown was averaging 2,468,000 viewers and 0.5 in the 18-49 demo. In May 2020, the audience was down to 2,010,000 per show while maintaining the 0.5 demo rating.
They hit their lowest marks in the summer but got a reprieve at the end of August with the return of Roman Reigns, the one star who opted to go home at the start of the pandemic due to concerns regarding the health of his family. On August 23, he returned to that year’s (empty arena) SummerSlam and won the Universal Championship one week later kicking off the most significant WWE championship reign of the past generation and one that would last more than three years.
The return of Reigns coincided with a large investment by the company to create the “ThunderDome”, which would take WWE programming to various buildings/stadiums and set up shop with video walls so fans could join virtually from their home. It was an acknowledgment that the empty setting of the PC was too detrimental for its presentation, even though the company was saving millions of dollars by being housed in its own venue and being paid its full fees from its broadcast partners.
The ThunderDome would launch at the Amway Center in Orlando, and later, take residencies at Tropicana Field in St. Petersburg, and conclude at Tampa’s Yuengling Center.
Numbers stabilized above the two million figure mark and received a monstrous lead-in on Christmas Day 2020 from the NFL leading to 3.3 million viewers watching SmackDown and its second-largest audience throughout the entire Fox run (behind the premiere episode).
In July 2021, crowds were welcomed back and 2.3 million viewers tuned in for the first SmackDown on the road in Houston.
Fast forward eleven months and the most significant impact on WWE occurred in June when the Wall Street Journal first reported on the existence of non-disclosure agreements linked to company chairman Vince McMahon centering around sexual misconduct allegations.
In a display of hubris, McMahon promoted an appearance on that week’s SmackDown amid the story gaining widespread attention and the question of whether McMahon would address the scandal on live television. McMahon walked into the Target Center in Minneapolis at the opening of the show to a mixture of cheers and boos when “No Chance in Hell” began. However, when McMahon walked out, he was met with a hero’s response before delivering the company’s tagline, “Then. Now. Forever. Together” and welcomed everyone to SmackDown before tossing the microphone and making a quick exit.
The appearance by McMahon generated SmackDown’s largest audience by that point of the year with 2,389,000 viewers and would become the third-largest audience of the year for the program.
McMahon would make multiple appearances on his programming over the next month without addressing the scandal but instead, went on a goodwill PR tour where he received a positive response from arenas full of his disciples that he viewed as a more powerful defense than choosing to verbalize one.
Everything hit the fan in July when additional reporting from WSJ’s Ted Mann and Joe Palazzolo placed McMahon in a precarious position where specifics of the allegations were outlined including one of a woman stating she was coerced into providing McMahon with oral sex. McMahon was being accused of paying $12 million in hush money payments to four women and paying for their silence.
On July 22, 2022, McMahon issued a brief post to Twitter announcing his retirement (read: resignation) and an appearance of leadership being handed over. All this while maintaining his role as the WWE chairman and largest stockholder with voting power that could overrule any decision in the company.
After the appearance of McMahon being gone, he exercised his stake in the company with a forceful return to his previous position despite pushback from WWE’s board of directors which led to a 180 when he was welcomed back against the threat of impacting the company’s forthcoming television negotiations.
McMahon was back in power at the beginning of 2023 on the condition he was exploring “strategic alternatives” for WWE and providing cover on the street as the stock reacted positively to the news of a possible sale or merger to offset McMahon’s scandals being placed on full display.
In time, it was discovered that McMahon had his finger on the pulse and was interjecting on many fronts with Ronda Rousey providing lots of details in her recent book, Our Fight.
However, the air of change was apparent to the fanbase and the belief of McMahon’s removal from the creative process was met with universal praise and a product that sorely needed a new creative direction.
The rise of Roman Reigns and The Bloodline, the signing of Cody Rhodes, and cultivating organic babyface stars like Sami Zayn, Kevin Owens, Bianca Baleir, Becky Lynch, and LA Knight contributed to the first true boom period the company had experienced since 2001.
It was evidence that having a great platform is helpful but presenting a strong product with better-defined stories and characters to attach oneself to are paramount to business success – even in the era of guaranteed revenue streams where the belief was creative had less reliance than ever.
A merger announcement was made the day after WrestleMania 39 and the WWE and UFC would combine to form TKO Group Holdings and McMahon insulated as the company’s number two executive behind Ari Emanuel – an astounding turn of events for someone nearly written off less than one year earlier.
Emanuel would state on CNBC that he demanded McMahon stay on board, even giving up his side of the equity portion to incentivize McMahon’s participation in the new company.
The Teflon nature of McMahon met its demise this past January with the filing of a lawsuit by former employee Janel Grant against McMahon, John Laurinaitis, and WWE for sexual misconduct and alleging she had been trafficked while working at the company among her charges.
McMahon could not host his own parade on his television after this one as the lawsuit detailed gruesome allegations and a depravity that even those with the lowest opinion of McMahon had trouble absorbing.
The pressure was immediate – just days after the announcement of WWE’s landmark deal with Netflix – the company was in crisis mode and faced sponsor revolt from Slim Jim ahead of that weekend’s Royal Rumble and McMahon resigned for a second time that Friday night. McMahon was gone, and Slim Jim returned.
For the past nine months, it has truly been a company free of Vince McMahon and while attached to a damning lawsuit, WWE has exercised a distance campaign from McMahon and been able to shake off any negative attachment that McMahon’s name brings in 2024.
WWE has unlocked more opportunities for revenue than ever imagined, filling its mat and sideboards with countless branding opportunities, selling its shows overseas, finding deeper ties to Saudi Arabia, and yet again, escalating its rights fees for SmackDown in its next contract.
Why is Fox getting out of the WWE business when it’s been a consistent Friday night winner in the 18-49 demographic?
Lachlan Murdoch provided some insight last November after the news that SmackDown was leaving the network:
I think we’ve talked about this before but how we analyzed the WWE renewal and we look at all of our sports portfolios in the same way… Based on the analysis, (from) an advertising point of view, we were not hitting the advertising numbers due to the audience of WWE to make the return for our return on investment to be above the levels that we would accept. But also, we didn’t attribute enough significant retransmission revenue to the WWE either. So it made sense for us to move on from them. They’ve been a great partner for many years. But just quite simply, we’re very disciplined and the R.O.I. didn’t meet our disciplined parameters so, we wish them luck and we’ve moved on from them.
It did draw some parallels to the May 2018 article in The Hollywood Reporter when Fox was getting out of the UFC business:
We could not sell UFC” at Fox, says a former staffer. “And wrestling is family friendly. If you have wrestling you can find cash. I think it’s a big win for Fox; it’s a great trade-off.
The SmackDown franchise – born in August 1999 on UPN – will move back to the USA Network next week in fewer homes but locking itself in for five years at $1.4 billion and the inclusion of four network prime-time specials on NBC annually.
Ultimately, the Fox era will be remembered for the pandemic, the Bloodline, and a resurgence in WWE’s popularity but most of all, it was the fall of Vince McMahon under heinous allegations that WWE has managed to sidestep and catch none of the residue despite its listing as a defendant.
