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SBD/January 9, 2014/Media
WWE To Launch Over-The-Top Digital Net, Subscription Service Supported By MLBAM
Published January 9, 2014
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NEW APPROACH: In L.A., Joe Flint cites regulatory filings as showing the WWE "first started talking about the network about five years [ago] and has spent" more than $40M on development. WWE initially "planned on a commercial cable network," then it "toyed with a pay channel model similar to HBO." WWE Chair Vince McMahon said that while a more traditional channel "could ensure a certain level of distribution," the terms pay-TV distributors "wanted in return for carrying a WWE channel were 'too restrictive.'" He added that the promotion had deals "ready to go with major distributors for a network that would have generated fees of 20 cents per month, per subscriber." The WWE instead "looked at how Netflix was able to create an OTT service and became convinced that its own rabid fan base would embrace a similar approach." The decision to go with an OTT service "may dampen the WWE's relationship with the cable and satellite operators that currently distribute their pay-per-view specials." The WWE said that it will "still offer its specials to cable and satellite operators." The net will be "mostly commercial-free but there will be sponsorship opportunities for advertisers" (L.A. TIMES, 1/9). MULTICHANNEL NEWS' R. Thomas Umstead noted the net will "launch with several new, original series such as The Monday Night War, a series exploring the mid-90s rivalry between WWE and WCW; WrestleMania Rewind, a comprehensive look back at the biggest moments of the WWE’s franchise PPV event; WWE Countdown, an interactive countdown series; and WWE NXT, featuring up-and coming Superstars and Divas" (MULTICHANNEL.com, 1/8).
BANG FOR THE BUCK? The WALL STREET JOURNAL's Merissa Marr notes the per month price point "pitches the network above direct-to-consumer services such as Netflix Inc. but below sports offerings like Major League Baseball's MLB.tv, which cost $7.99 and $25 a month, respectively." WWE said that it "didn't want to breach the psychological barrier of $10" (WALL STREET JOURNAL, 1/9). In Philadelphia, Vaughn Johnson writes the net offers "tremendous value for the amount of content that will be at the tips of people’s fingers." The price point, granted, comes "with a six-month commitment, but that’s still only $60.00 for six pay-per-views, which costs nearly $60.00 per month." Something to "keep an eye on is how good the streaming quality will be." There were numerous reports of the WrestleMania XXIX stream on WWE’s website "failing multiple times last year," which "explains the reason for the company working with" MLBAM (PHILLY.com, 1/9).
ROLLING THE DICE: AD WEEK's Sam Thielman wrote the net is an "undeniably gutsy move for the entertainment company and one likely to raise its profile, but it's also a costly one." WWE Exec VP/Digital Media Perkins Miller said that the net would "include bells and whistles like push notifications for the networks' mobile app, which will also stream the shows on your smartphone when you're not at home and provide second-screen content when you are." The promotion has "one of the few back catalogs that hasn't yet been monetized by a streaming service; this new experiment will demonstrate exactly how well a single fandom can support a single stream of content" (ADWEEK.com, 1/8).