Netflix Takes Step into Live Sports with $5 Billion WWE Deal

Tim Cross 23 January, 2024 

Netflix today announced it has agreed a deal with major wrestling brand WWE to exclusively air all of its content in a number of international markets, and to broadcast Raw, one of its two weekly flagship shows, in the US. The move is a huge step towards broadcasting live sports content (or could be counted as Netflix’s first step into the space, depending on whether you categorise the WWE’s brand of ‘sports entertainment’ as true sport). It also is a major shift in strategy for the WWE itself, which has been a mainstay of linear TV around the world for 31 years.

The deal will see WWE Raw, a live weekly wrestling show, broadcast on Netflix in the US, UK, Canada, Latin America, and other unnamed territories from January next year. More countries and regions will be added over time. In international markets, Netflix will host all WWE shows and specials, including weekly shows SmackDown and NXT, and its numerous pay-per-view events including WrestleMania, SummerSlam, and the Royal Rumble (though it’s not clear whether they’ll continue to be offered on a pay-per-view basis).

TKO’s president and COO Mark Shapiro says the deal (reported to be worth $5 billion by the FT) offers the WWE expanded reach, and a new economic model. “[The deal] marries the can’t-miss WWE product with Netflix’s extraordinary global reach and locks in significant and predictable economics for many years,” he said.

Bah gawd, that’s Netflix’s music!

The WWE, which is now owned by holding group TKO after its merger with Endeavor Group Holdings, owner of mixed martial arts brand UFC, is no stranger to streaming. The group for years pursued a direct-to-consumer strategy, via its paid service WWE Network. But in a number of markets it’s slightly backed off the strategy, by folding the service into another third-party owned streaming app. This includes the WWE’s home market, where WWE Network has been rolled into NBCUniversal’s Peacock. Regardless, the streaming app has always been secondary to linear TV in terms of distribution.

It’s a major strategy shift for Netflix too. While the streamer has experimented with live content before, executives have played down its ambitions in the live sports space. The company has stuck with sports-related content, like its popular Drive to Survive F1 series, rather than hosting live sports itself – citing the heavy costs attached to sports rights.

This may explain why Netflix has chosen the WWE as its first live sports project. It’s a hefty sum of money, but the deal secures exclusive streaming rights in numerous major markets for a sports brand which has a fairly devoted fanbase. Compared with Premier League football for example, which sold UK-only rights for $8.5 billion, WWE content may have appeared a relatively cheap option.

You can’t stream me?

There will be a number of challenges for Netflix in preparing for launch. While it’s already live streamed a number of shows, it has had technical problems along the way. While buffering issues aren’t terminal for live comedy shows or reality show reunions, in live sports they can quickly anger audiences.

There are also questions around monetisation to be answered. Since WWE has historically run on linear TV, it’s also been ad-funded. Netflix has an ad operation up and running already of course, but it’ll need to decide whether to show ads to users currently signed up to its ad-free tier. And as mentioned earlier, WWE hosts a number of pay-per-view shows each year. Netflix will have to decide whether to adopt the same model. If it doesn’t there will be questions on whether the economics add up as well as they traditionally have.

If Netflix cracks all these components, speculation will inevitably ramp up over whether it’ll make a broader live sports play. If it does, TKO’s other major property the UFC might be an obvious first port of call.

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About the Author:

Tim Cross is Assistant Editor at VideoWeek.
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