Why Is WWE Creating Propaganda for Saudi Arabia?

In the aftermath of the assassination of Jamal Khashoggi inside Saudi Arabia’s consulate in Istanbul, the reaction in the business community was swift: Several American businesses received pressure to stop doing business with the kingdom, and many pulled out of the country, at least for the time being. But others have stuck with Saudi Arabia, including the one whose enmeshment with the royal family has probably received the most attention in recent weeks: World Wrestling Entertainment, the largest purveyor of professional wrestling on the planet.

This Friday, exactly one month after Khashoggi was killed, WWE will produce their second show in a partnership with the Saudis, WWE Crown Jewel in Riyadh. The first show, April’s Greatest Royal Rumble in Jeddah, is basically Exhibit A for the backlash against WWE: The event was almost entirely a lengthy propaganda infomercial for the kingdom, pushing local tourism, the claimed social progress of the country under Crown Prince Mohammad Bin Salman, and hostility towards Iran.

WWE is on the verge of bringing in significantly higher profits than ever before when they start their new domestic TV contracts next year, so the Saudi deal wasn’t an existential necessity for the company. So while it’s fairly simple to understand why WWE made a deal with Saudi Arabia—since they were far from the only ones to do so—it’s a little more complicated to understand why the WWE brass would agree to this deal, and all of the geopolitical ramifications that come along with it.

The original lifeblood of the world’s most popular “entertainment sport” was entirely made up of ticket sales. Almost nobody in the wrestling space got paid for their TV shows, so instead they would pretty much give their programming to stations in exchange for promoters being able to air localized interviews previewing each town’s weekly, biweekly, or monthly show. Vince McMahon was the man who really changed this landscape: He took his WWE (which at the time was known as the World Wrestling Federation, or WWF) and got the ball rolling on diversified income streams. McMahon’s company started selling merchandise in arenas (which Japanese and southeastern promoters had pioneered), making licensing deals for retail products, and began aggressively marketing home video and pay-per-view. It was incredibly volatile, though—“pro wrestling is cyclical” is the common cliche—and a lot could change on a whim. Making informed decisions about those changes could be difficult, and getting reliable purchase data from pay-per-view companies still takes months, even these days.

In the last several years, WWE has sought to change as much of that as possible, trying to find reliable, steady revenue streams. Some of it was opportunistic: The sports broadcasting rights bubble, with networks shelling out big money for theoretically “DVR-proof” live programming, was something that they could easily exploit with their own slate of live programming, for one. In the same vein, they made the move to abandon traditional pay-per-view, launching WWE Network in February, 2014, as a subscription service anchored by the monthly specials that had previously been pay-per-view events, albeit for about 20% of what they had been charging for those shows. With a lower price than the outdated pay-per-view model, worldwide availability, and the benefits of people forgetting about their subscriptions, WWE Network has achieved a steady state of well over 1.5 million subscribers.

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