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| Thursday, May 10 Updated: May 11, 2:37 PM ET |
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| Stockholders, not fans, are key now in sports business By Darren Rovell ESPN.com | |||
Oh, how the XFell.
Throughout the season, it was easy to see how the 'X' stood for Xtreme after all, even if league officials spent most of the season telling members of the media that it stood for nothing in particular.
Xtreme in the way the league debuted, after a year full of hype. And Xtreme in the way it died with the league's weekly drop in ratings.
"It shined with a bright meteoric presence on the landscape of the American sports scene, but in the same light, it fell to the ground the quickest," said Dean Bonham, chairman of the Bonham Group, a sports consultancy firm.
The league failed to deliver to fans – who expected to see better football – and to advertisers, who expected to see better ratings. The league also failed to deliver to the stockholders of the World Wrestling Federation Entertainment.
"While we believe that it is an extraordinary accomplishment to have created a new professional football league in what amounts to less than a year's time, we feel that it is in the best interests of our shareholders and our partners to discontinue the XFL," said Vince McMahon, WWFE Chairman, in an news release announcing the league's demise.
"The sports world of today is not what it was 10 years ago," said David Carter, a principal of The Sports Business Group, a sports consultancy firm. "Teams and leagues are owned by publicly-traded companies that are scrutinized by Wall Street on every decision. Investors don't care as much about the emotions of the game. They are expecting a return on their investment and if it's not there, it should be spent elsewhere."
"NBC can make better use of its time on Saturday night, and the WWF has better projects to invest in than the XFL," said Neal Pilson, former president of CBS Sports.
The WWF purchased wrestling rival WCW in late March.
By the close of the business day on Thursday, shares of WWF stock were down 32 percent ($13.15) from the price of shares on Feb. 3 ($19.20), the day the XFL made its debut. General Electric, the parent company of NBC, which spent $30 million for an equal share in the league, saw its stock increase more than 7 percent since the opening kickoff – but the company's loss in the league barely registers a blip on GE's overall financial screen.
"The XFL's demise was unquestionably hastened by the fact that the league was run by a public company that had to answer up to sensitive shareholders interested in value on a day-by-day basis," Bonham said. "The losses incurred by the WWF, as well as the potential for future losses as a result of the XFL, were simply not going to be acceptable."
Darren Rovell, who covers sports business for ESPN.com, can be reached at darren.rovell@espn.com
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ALSO SEE Ex-FL: Vince McMahon folds XFL after one season Team officials throughout XFL surprised by announcement Many agree, XFL fulfilled some of its purposes XFL's championship game yields X-tremely low ratings McMahon says XFL to return, but probably not on Saturday nights AUDIO/VIDEO  Richard Sandomir of the New York Times discusses the death of the XFL.wav: 5523 k RealAudio: 14.4 | 28.8 | 56.6 | |
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