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Six months ago, during the build-up for The Greatest Royal Rumble, I asserted that the event in Jeddah, Saudi Arabia was the strangest event in WWE history. Well move over and make room for Crown Jewel! An event that has become so unfathomably absurd that it has put WWE in the middle of geopolitical controversy. Crown Jewel has put the company in the awkward position of accepting large sums of money from a regime that appears to have blood on it's hands. Some US Senators have even chimed in on the issue asking WWE not to do the show at this time.
The deal with Saudi Arabia was always going to be controversial for WWE. During The Greatest Royal Rumble the criticism centered on the restriction on women, and Sami Zayn, performing on the show. This almost immediately brought attention to the overall terrible state of female rights in Saudi Arabia. That was bad and WWE received a lot of justifiable criticism from the media about the hypocrisy of promoting themselves as very pro-women while doing business with a government that is approximately 200 years behind the rest of the world when it comes to women's empowerment. The situation they find themselves in now appears to be even worse.
The issues in Saudi Arabia have been getting more extreme in recent months. Perhaps, most notably, with The Kingdom's diplomatic dispute with Canada in August. Then things exploded when the Saudi Arabian government was accused of murdering Washington Post columnist Jamal Khashoggi while he was visiting the Saudi Arabian consulate in Istanbul. Khashoggi was a former Saudi Arabian journalist who had immigrated to the United States and was known for his criticism of the Saudi Arabian royal family.
I'm not going to go into any greater detail about US/Saudi Arabian foreign relations here. If anyone is interested they can read more online on any number of reputable news sites. However, following the murder of Khashoggi, the relationship between foreign businesses and Saudi Arabia have changed greatly. That includes WWE, who inconveniently have a big show scheduled to take place in the Saudi capital of Riyadh on Nov. 2. No other publicly traded company wants to risk appearing to be friends with the Saudi Arabian government right now. For that reason WWE appears stubborn in their decision to continue to promote Crown Jewel.
All signs currently seem to point to WWE sticking to their plan in Saudi Arabia for the money. According to their financial statements, WWE received approximately $50 million from the Saudi Arabian government for putting on the Greatest Royal Rumble. It is unclear whether WWE received $50 million for just the one show, or if it was part of a larger deal where WWE got $50 million for the first show and will be receiving less money per show going forward. We do know that WWE has signed a 10 year deal with the government for $450 million, a massive amount for a company the size of WWE. In 2017 the company had a revenue of $800 million, so $50 million would have been 6.25 percent of their total revenue for that year.
That's a lot of money. WWE can survive and even thrive financially without it. WWE has a $2 billion television deal about to kick in and is going to make more money than ever before. WWE can easily say no to the Saudi Arabian government and take the financial hit and be fine. To me, it's a bad look for the company in the sense that they seemingly NEED the Saudi Arabian money. When, in reality, it's just some chocolate syrup on an already sweet money sundae. It's a nice bonus each year, but it isn't critical for WWE's financial portfolio.
Let's Talk About Propaganda
A lot of the coverage about WWE heading to Saudi Arabia has been simply about the fact WWE is doing business in the country. While that is a real concern, I don't think the problem here is WWE running a show in Saudi Arabia. Corporations around the world have continued to do business in Saudi Arabia over the last several weeks, including sporting events such as the Argentina vs Brazil international soccer game that took place on Tuesday in Riyadh.
The real problem is that WWE isn't just taking Saudi money to run a show, they are taking Saudi money and using their product to market Saudi Arabian propaganda to their audience. This is not a conspiracy theory; this a fact. Just look at this video that aired on the WWE Network during the Greatest Royal Rumble:
Video WWE aired during GRR in April celebrating Saudi government pic.twitter.com/AzSdUotwAZ— Brandon Howard Thurston (@BrandonThurston) October 10, 2018
If you watch that video, and you know that WWE is receiving $50 million from the Saudi government, there is nothing to say except that WWE is comfortable using their platform to peddle political propaganda. With the latest bloody controversy surrounding the Saudi Arabian government, WWE doesn't seem to be in the position to be arguing that the Saudi Arabian government is actually very progressive and understanding.
The real losers in this are the WWE talent. Some of whom anonymously told Justin Barrasso of Sports Illustrated that they did not want to go to Saudi Arabia. Obviously, they are not allowed to say anything publicly about the issue. The talent are the ones who have to go on television and talk about how great Saudi Arabia is and be featured in the video packages praising the government. That talent is also effectively muzzled by WWE management with fears of repercussion if they jeopardize WWE's lucrative deal with the Saudis.
Will WWE show the moral fortitude to pull out of the Saudi Arabia show? I don't think so. Not after RAW and SmackDown this week where the show was heavily pushed, despite the actual location of the show never being mentioned. WWE's game plan is to weather the criticism of the Crown Jewel show and hope the Saudi Arabia controversy is out of the spotlight by the time their next show comes around. The only thing that could actually stop them is if the talent unifies and refuses to go or the US government tells them that they can't go, neither of which appear likely.
One thing to keep note of is that historically it has been very hard for wrestling on television to attract advertisers. There has been the long-held belief that wrestling fans on average lack disposable income that could be spent on products; something that has hampered wrestling promotions from signing lucrative network contracts in the past. WWE has tried very hard over the years to shed that stigma and has been successful, gaining consistent advertisers and sponsorships and eventually leading them to the massive TV deals with USA and FOX.
However, with the general public viewing the Saudi Arabian government with such disdain, advertisers may be apprehensive about aligning their product with a company that is being used to promote Saudi Arabian propaganda. WWE has tried very hard to present itself as an upstanding, modern company to advertisers and investors, but with so much mainstream news coverage about WWE's involvement in Saudi Arabia, that carefully crafted image could be destroyed. WWE's stock price hasn't necessarily been affected recently by the controversy, and there hasn't been any reports of advertisers pulling away from WWE, but it's something that could end up seriously hurting WWE if they continue to forge this relationship with the Saudi government.
Lastly, WWE actually has an opportunity to turn this public relations nightmare into a win. WWE has been trying their best to show that they are a caring, progressive company. If WWE declines to continue the Saudi Arabian relationship, they can make a big deal about how they were putting morality over making some extra money, and for once, actually be truthful about it. I doubt that is actually going to happen, but if the criticism continues, WWE has an escape route if they need it.
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Catch Jesse every Thursday afternoon as part of Wrestling Inc's WINCLY podcast chatting about his latest VFTT editorial. Jesse's latest appearance can be heard in the embedded player below: