I’ve said for a long time that WWE has been ahead of the curve in the television and digital industries. That’s one of the reasons I decided to work at WWE Digital last summer instead of a corporate PR firm. Because of their unique brand position, perhaps it’s easier for them to shift into new business models. They finally announced the long-awaited WWE Network last night (via YouTube live stream) and it seems like an awesome deal for the fans.
The WWE Network has been in development for years. Initially it was to be a traditional cable channel, but given how WWE has embraced pushing out digital content, it’s not surprising that they’ve moved the “network” concept to a digital-only platform. Regular RAW viewers know how WWE has been pushing (to put it mildly) adoption of the WWE app and the social media accounts. They’ve now firmly bet that the audience is comfortable enough with using devices other than the cable box to watch WWE.
Considering the sheer volume of content (by the way, I hate the word “content,” but I feel it’s accurate here) WWE has amassed over the years, an online outlet makes more sense than a traditional cable channel. It appears that, in addition to the 24/7 streaming videos, WWE will make a library available to subscribers. That’s all great.
Here’s the part that surprised me in a good way:
All pay-per-views (including Wrestlemania) are included. For about 10 bucks a month. The mind-boggling thing about this is that each PPV is currently priced around $45. This leads me to believe a few things:
1. At the current price point, the PPVs aren’t providing more revenue than the traditional cable deals with NBC Uni.
2. PPV piracy is a problem worth addressing.
3. WWE is betting on casting a wider net at a smaller price point, rather than ask for exorbitant fees from a smaller group of super fans. Supposedly they’ll need around a million subscribers to make this profitable. There’s an international roll-out planned and I suspect a good chunk of the necessary fan base will come from overseas. (Think of how WWE Network programming could be tailored to specific international audiences…)
4. WWE can use the network to develop more mainstream, non-match content that can be repackaged and sold to traditional cable nets (i.e. launching more Total Divas-like series, such as “Legends House”).
Most mainstream TV biz articles I’ve read are emphasizing that WWE is investing in cord cutters. While that’s true, WWE is still raking in a ton of money from their deal with USA (and I assume) Syfy. I don’t envision WWE fully departing the traditional TV broadcast in the near future (although I suspect that will come eventually). If WWE can get their audience to join them online now, they’re setting the table for a cable-less future.
I think this less about total cord cutting and more about the fact that an interactive VOD-style setup works much better when your brand has a huge archive. (Keep in mind that WWE has purchased the archives of other promotions and obviously owns the WCW material as well.) Offering paid on-demand content may also help the satisfy the fans who crave more hardcore content, since the current broadcast offerings are PG-only. The network will allow WWE to expand in all directions under one brand. I could easily see a dedicated WWE Kids channel in the future, along with a WWE Hardcore channel (where they can at least attempt to filter out young users).
The network should also give current performers a platform to showcase their personalities (if they have them). WWE has already started doing this on their app and website, but the network will help build this up. It’s cheap enough to do these short form reality-style shows (in or out of kayfabe), and there are a number of wrestlers who already shine on social media (*cough*Big E. Langston *cough cough*).
I’d love to see WWE take their sports entertainment concept even further with a tongue-in-cheek version of SportsCenter. Having a more news-based show would help them focus their story lines better than just replaying clip packages ad nauseam on RAW. Get a couple funny, quick-on-their feet “anchors” in there? Yes please.
While we’re at it, how about more Legends’ roundtables (rather than wacky Real World-style hi-jinks?) A more polished version of Colt Cabana’s show? An expansion of NXT programming? These are all no-brainers and inexpensive prospects.
Again, per month, this is about a quarter of the price of a typical PPV. Anyone who was pirating PPVs or NXT episodes now has no reason to do so. Anyone who just skipped PPVs because of the expense will now likely fork over a bit of cash to watch them. WWE has figured out a way to encourage fans to access content for a seriously modest fee. Unlike HBO Go, you don’t need to be a cable subscriber to do it. Seems fair to me.
I’m not sure what other company could do this. There aren’t too many other brands that own all the rights to everything they’ve done, have 30+ years of content in the can, and don’t already have a dedicated cable channel. Hardly anyone else is even in the PPV game (which now seems over). If WWE Network does succeed, I bet some niche companies will at least take a closer look into the independent subscription model.
EDIT: Jeremy Meyers adds the following insight: “They’re about to renegotiate their cable broadcast deals which will bring in a ton of new revenue, so maybe they’re trying to realign their revenue channels to not need as much from PPV.” He also thinks the number of PPVs (currently 12) will drop now, and I definitely agree.