WrestleMania X-7 (17) is regarded as being one of the greatest events in wrestling history, and to many WWE fans, it was the pinnacle of the company's success during the Attitude Era. Not only did the show feature a massive main event between The Rock and Stone Cold Steve Austin, it also had a memorable semi-main event between The Undertaker and Triple H when both men were in their athletic primes, as well as the spectacular TLC tag match between Edge and Christian, The Dudleys and The Hardy Boyz.
As good as the show was, one could look back on it and point to it as the beginning of a long, nearly two decade decline in the overall popularity of WWE. The show took place just six days after the closure of WCW, and could be seen as a celebration of WWE's triumph over its hated rivals, but in reality the show would be the peak of WWE's success, and following the show the company would go on a long decline, essentially killing the Attitude Era and rushing in a new series of eras where WWE would attempt to re-create the success they found during the late 1990s and early 2000s.
Why did this decline take place? The simplest answer is that WWE made a single, catastrophic blunder that led to the company rapidly losing popularity. No, that blunder was not botching the invasion angle of WCW and ECW wrestlers, but rather the decision in the main event of WrestleMania X-7 to turn Steve Austin heel.
The Attitude Era was built on the success of Steve Austin as a babyface. Yes, a heel Vince McMahon character, the ascension of The Rock, the antics of D-Generation X, and performances by The Undertaker, Mick Foley, Kurt Angle and others would also contribute, but RAW viewership began to surge in late 1997 when Austin gained momentum as a babyface, and they would decline in 2001 when he became a heel. Austin as wrestling's penultimate anti-hero was the driving force behind WWE's record breaking success.
When WrestleMania X-7 went off the air, with Austin getting his hand raised by Vince McMahon, fans were shocked. Very few could have predicted that Austin would join forces with his nemesis; partly because Austin was so hugely successful as a babyface that it didn't make sense for him to be a heel. People watched RAW and bought tickets to see Austin kick-ass as a babyface, as a heel he certainly lost some of his appeal as he became a crybaby, hiding behind McMahon's authority.
The ratings for RAW reflect that lose in interest. In 2000 the company was receiving their highest ratings in history, averaging a 5.88 rating per episode. By the end of 2001, with Austin as a heel for most of the year, the rating had fallen to a 4.64 rating per episode, with a noticeable decline taking place in the months following Austin's heel turn. In 2002 ratings continued decline, with Austin walking out of the company in June because he reportedly didn't like the way his storylines. RAW ended up with a 4.01 average rating per episode in 2002, and ratings would continue to decline over the years.
Obviously there were many other reasons for the declining viewership and the end of the Attitude Era outside of Austin's heel turn, including the botched Invasion angle, the loss of The Rock to Hollywood stardom, an inability to create new stars as a new generation came of age, etc. but what took place at WrestleMania X-7 did set the tone for the next 17 years of WWE.
First, it was a major misfire by WWE creatively, in understanding what the fans want. Nobody was clamoring for an Austin heel turn, yet WWE decided it would be a good idea to generate interest in the product, which it failed to do. Since Austin turned heel, WWE has been unable to create a babyface in the same stratosphere, the closest being John Cena, who was able to raise television viewership slightly during his peak, but never came close to delivering the same ratings as Austin, nor selling as many tickets as Austin did in his prime.
No matter how hard the company has tried, and lord knows with Roman Reigns they have tried, WWE has been unable to replicate Austin's success as a drawing babyface. Through accelerating TV rights the company is still doing great financially, but for almost two decades the company has tried to create a babyface that was as popular as Austin, failing with each attempt.
Second, it created an atmosphere where WWE fans began to be more critical of the product. While fans had shown their displeasure with certain creative decisions in the past, the combination of Austin turning heel and the mishandling of the Invasion storyline were the beginning of an era where WWE would be hit with mounting public criticism, first in the arenas and later through social media, about the company's stunted creative direction.
The criticism of fans could be dismissed by some as incessant whining by fans who think they know better than the decision makers, but the decline in popularity indicates that WWE really does have a problem with getting fans to remain invested in its product.
Third, the closure of WCW also ended an era of true competition for WWE, not just a competition for the interest of fans, but also a competition for talent. Part of what sparked WWE's success during the Attitude Era was that the company was able to benefit from frustrated talent who left WCW, including The Undertaker, Foley, Jericho and Triple H. Austin himself was famously fired by WCW before catching on in WWE.
With WCW out of the picture, WWE became the de facto location for wrestlers to earn major league money. Particularly in the early 2000s following the closure of WCW, very few wrestlers were able to gain notoriety and make major money outside of WWE, with options being limited to fledgling indie promotions in the US, or trying to catch on in Japan and Mexico, which were also seeing declines in popularity from their heights in the mid-90s.
The result of those limited options was that frustrated talent that in the past would have had the option of leaving the company and still be able to find major league exposure, were more or less stuck in WWE. Even if they were horribly misused, a lot of talent would feel limited in their options outside of WWE, so they collected their money and remained stuck in the company.
Today, with a blossoming indie scene and some promotions garnering significant financial backing, there are more options for frustrated talent, and the result is that just as Austin two decades before, talent like Cody Rhodes have turned themselves into major stars after leaving their original promotion.
WWE was probably already prone to seeing a decline in popularity in the early 2000s regardless of Austin turning heel or not; to some degree the company was so popular that the only direction to go was down. However, Austin's heel turn accelerated that decline and helped create the current culture WWE now finds itself in, a company with a dwindling fanbase. Austin's heel turn didn't just kill the Attitude Era, it killed WWE's ability to retain its fanbase and create new fans.