WWE And The Crown Jewel Problem

On November 2nd, WWE is set to have the second show in their reported 10 year 1 billion dollar contract with Saudi Arabia as part of their Vision 2030 propaganda campaign to show how Saudi Arabia has ‘changed’.  The show, called WWE Crown Jewel follows last years “Greatest Royal Rumble” which wrestling aside, was basically a 3 plus hour commercial for Saudi Arabia (which is how stuff works).

Little by little, more information has come out regarding the tragic and reportedly terrible death of missing Saudi journalist Jamal Khashoggi.  Many believe that somehow the Saudi Arabian government led by “MBS” Crown Prince Mahammad Bin Salman is responsible for his death.

Many in Washington have called for WWE to at least postpone this years event.  Senator Chris Murphy of Connecticut:

“This is a brazen assault on the freedom of the press and a slap in the face to the United States, if this murder occurred as it seems it did, I’d hope that they would be rethinking their relationship with the kingdom especially with respect to events coming up in the next weeks like [WWE Crown Jewel].”

Senator Lindsey Graham took it a bit further:

“There should be a pause…I want a complete rethinking of our relationship”

Like most other things, this issue is far more complex than just having or not having the event.  Let’s look at it from a couple of different perspectives.

Business

There is no reason for WWE to cancel the event from a business point of view.  Unless new information comes out that causes the stock to drop sharply (it’s down $12.00 or so in two weeks- but most analysts don’t think it has anything to do with Crown Jewel), then they have no good logical reason to not press forward with the event.  As a corporation, WWE is beholden to do one thing- that’s maximize shareholder value.  A 10 year 1 billion dollar contract won’t be thrown away or tossed aside.

Morality

This one is a bit trickier.  WWE has always viewed itself as a very socially aware and socially responsible company.  We can dispute the validity of that all we want, but that’s how they view themselves, and by in large many would agree with them.  They raise tons of money a visibility for Make-A-Wish, Conor’s Cure, and countless other charities.  Their stars are for the most part very good citizens that love their fans.  Tribute to the Troops is a huge success for them, and they love giving back to their fans and the community at large.

Saudi Arabia is a complex issue for them.  They really believe they can drive change through entertainment.  They held the first ever women’s professional wrestling match in Abu Dhabi last December.  They noted that women were allowed to purchase tickets and actually drive to the event last year (a HUGE change).

However, this regime is not all it appears to be- and this Khashoggi situation is just the tip of the iceberg according to some- creates a troubling position for the company.

Politically- External Forces

A common refrain is that WWE should be “prevented” from going to Saudi Arabia.  That’s one thing I will never be on board with.  WWE is a publicly traded company that will have to face consequences for its actions.  Again, while being an agent for change is great, and being a good social citizen looks great on a press release, WWE leadership is (and should be) concerned with one thing- maximizing shareholder value.  Interference from the government into the affairs of a private business should never happen.

John Bradshaw Layfield, former WWE champion and now Fox News television show host who is also held in high regard in the business community correctly stated that the isolationist policies in places like Cuba and North Korea seldom do anything beyond embolden countries like Russia and China and impoverish the nation.  In addition, Saudi Arabia is our sole ally in a very important region- the Middle East.  Abandoning them would have serious and perhaps dire long term macroeconomic consequences.

The optics of supporting a country like Saudi Arabia are also awful.  This is a country that has a wide ranging history of human rights abuses and is currently systematically destroying Yemen.  Like the “morality” above, this puts WWE in an extremely difficult spot.

Politically- Internal Forces

It has been reported that many in the locker room are extremely uncomfortable with traveling to Saudi Arabia in light of the current situation in the region.  Some likely fear for their personal safety, some likely don’t agree with the political decision.

Here’s the rub- it’s a large payday.

While WWE performers are independent contractors and certainly have the right to not perform there is a fear that their position in the company would be compromised by opting not to go for moral or ethical reasons.  It’s a rational fear that I’m sure most of us would have.

WWE legend Ted DiBiase once said “Everybody has a price”.  What is a current performer’s price?  What long term price will they pay?

Again, like a Facebook relationship, It’s complicated.

What Should Happen

WWE should postpone the event for a year (or even six months) to let everything cool down- make a statement like this:

“After many hours of deliberation, we don’t feel that the time is right to move ahead with this event until a full and complete investigation of the tragedy surrounding Jamal Khashoggi’s disappearance and death has completed.  We know this situation disappoints the WWE Universe and our superstars who were looking forward to entertaining our great fans in Saudi Arabia.  We will have no further comment at this time”

What Will Happen

WWE will go ahead with the event unless something dramatic changes in the next 10 days.  Fans will tell everyone that will listen about how they will “never watch WWE programming again”, but will still tune in each week and every time there is a pay-per-view on the WWE Network.

Despite what people want you to believe, this is a very complex and fragile situation in which WWE just happens to have center stage right now.  Every US president in recent memory has had a favorable relationship with the Saudis.  They are a horrific regime that has made some strides, but still is light years behind what an ally of the United States should look like socially.  They are also our sole ally in the Middle East, and if they are shunned by the US, you better believe that Russia or China will welcome them with open arms.

In closing, I’ll just offer some useless advice to the WWE powers that be.

Good luck, you’re gonna need it.