| BUSINESSWEEK ONLINE : MAY 29, 2000 ISSUE | ||||||||
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| COVER STORY
WWF: One Rock-'Em, Sock-'Em Company World Wrestling Federation Entertainment Inc., Stamford, Conn.
What's not to love? The prospects for the WWF--No. 3 on this year's Hot Growth list--have broadcasters salivating. Viacom Inc. and USA Networks Inc. are battling in court for the rights to USA's WWF shows. NBC Inc., meanwhile, just took a 3% stake in WWF for $30 million and will jointly own and broadcast the WWF's new XFL football league. Such interest has helped sales slam ahead by an average annual 67%, and earnings by 188%, over the past three years. Over the past four quarters, the WWF earned $70 million on sales of $356.7 million. New ventures aside, showcasing oversized and underdressed adults tossing each other around a ring remains the company's core activity. If wrestling is the soul of the WWF, the McMahon family, which owns an 83% stake in the 20-year-old company, is clearly its muscle. Vince, 54, the buff founder and chairman, is the creative genius who injected drama into the ''sport'' of wrestling, turning it into mass entertainment. His wife, Linda, runs the day-to-day operations as president and CEO. Son Shane, 30, and daughter Stephanie, 23, work as both characters in TV matches and as executives in the sales and new media operations. Says Linda, 51: ''It's a total family business.'' There have been some body blows along the way. Recent battles include Coca-Cola Co.'s decision to pull ads from the racy WWF Smackdown! cable-TV show and a spate of lawsuits, including one filed by the family of wrestler Owen Hart, who died last year during a stunt. Vince's desire to switch from USA Network to Viacom's CBS has also caused a legal fracas. And critics wonder if a new football league is wise, especially if fans think--wrongly, Linda insists--that the plays are scripted like a wrestling match. If that weren't enough, pressure is mounting from Ted Turner's rival World Championship Wrestling, which has scooped up WWF talent in an attempt to boost ratings. IT'S ENTERTAINMENT. But the WWF continues to win the war, posting some of its highest ratings ever in recent weeks. Even without Coke, ad revenues are almost double those of last year. And merchandising deals with 110 licensees now account for about a third of revenue. There are also platinum CDs of WWF music, a new video by the group Run DMC, and two best-selling ''autobiographies'' of WWF stars. Even WWF's forays into pro football and sports like racing don't look so silly to analysts such as J.C. Bradford's E. Breck Wheeler. ''If anybody has a shot at making it work, they do,'' she says, citing a top media partner, a loyal audience, and the McMahons' ''out-of-the-box thinking'' as natural advantages in the XFL venture. After all, if there's one word that makes the McMahons blanch, it's ''wrestling.'' ''We're all about entertainment,'' says Linda, pointing to such proposed ventures as an action-adventure TV series and a late-night talk show starring WWF talent. The question is how far the WWF can stretch beyond its muscled monster men. Are people really clamoring to see Mankind or ''Stone Cold'' Steve Austin wax on about world affairs in the wee hours? It sounds like a long shot. Then again, who would have imagined that the WWF would have come as far as it has? By DIANE BRADY _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ BACK TO TOP |
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