After claiming for months that it had no intention of selling World Championship Wrestling, Turner Broadcasting System Inc. last Thursday sold the beleaguered grappler to a new venture headed by former Classic Sports Network president Brian Bedol.
Bedol, Classic Sports co-founder Steve Greenberg and former WCW president Eric Bischoff believe they can return the company to prominence-despite rival World Wrestling Federation Entertainment Inc.'s dominance in the category.
The deal also purges TBS parent AOL Time Warner Inc. of a financial drain. Industry observers estimate WCW lost $50 million to $70 million in 2000 alone.
Fusient Media Ventures, a new company, will pay about $75 million for WCW, sources close to the situation said. TBS Inc. will retain a minority interest in the company, which has struggled to compete against the WWF.
Under the agreement, Turner Network Television will continue to distribute its signature TV show, WCW Monday Nitro, and TBS Superstation will retain its weekly series Thunder, TBS Inc. president of general entertainment networks Brad Siegel said.
TNT, which is tailoring its lineup to add more drama and entertainment programming, may eventually move Nitro
to TBS or another channel.
When asked how wrestling fits into TNT's programming strategy, network executive vice president and general manager Steve Koonin said, "It's being evaluated as we speak."
Turner also will handle ad-sales efforts for WCW's cable-distributed shows.
But Turner will no longer deal with day-to-day operations or bankroll the wrestling outfit, which has suffered a ratings and PPV buy-rate freefall in recent years. After generating record ratings and strong PPV sales in the-mid 1990s, WCW has tumbled in recent years and has fallen well behind the WWF.
During the fourth quarter of 2000, WCW's Monday Nitro
averaged a 2.4 Nielsen Media Research rating, less than half the 5.1 rating tallied by the WWF's Raw Is War
in head-to-head competition.
The disparity is even greater on the PPV side. In 2000, the WWF averaged around a 1 buy-rate on monthly events, while the WCW's buy-rates averaged around a 0.2 to 0.4.
Siegel said the company had been negotiating with Fusient for four to five months before reaching an agreement.
Speculation that TBS may look to sell WCW began almost immediately after the Time Warner-AOL merger was announced last January, although last week Siegel said the merger did not prompt the deal.
Siegel had been quoted several times last year as saying Turner did not intend to sell the franchise. Last week, he said, executives started listening to offers that came in after the sale speculation began.
"We were not looking to sell the WCW, but once the rumors were out, a lot of legitimate opportunities began to come our way," Siegel said. "I had a fiduciary responsibility to listen to them, and at the end of the day, discussions with Fusient were the most positive."
Despite recent WCW difficulties, Bedol said the cable shows still generate some of the highest weekly ratings on cable, and the PPV events continue to generate consistent revenue.
Bedol and Greenberg launched Classic Sports in 1995 and eventually sold the network to ESPN in 1997.
"We have enormous confidence in the category.[and] for an entrepreneurial business, this is a perfect fit," Bedol said. "Wrestling has emerged from being a niche sport, to popular culture, to the point where many of the highest-rated shows on cable are wrestling events.
"It also has many revenue streams to tap into. I think we can continue to rise to a whole new level and we're pleased to be a part of it and make that happen."