The WWE Network is coming and the announcement has taken the wrestling world by storm. The new network will come with intriguing ramifications. Now that the dust has settled I wanted to take a look at some of the key takeaways from all of the latest news.
– The network will be $9.95 and offered in six-month contracts. For that price fans will receive access to all of the DVD releases and every single pay per view. Where in the world are they going to make up this lost revenue? I see a lot of people bullish on the stock but I don’t get it. If there was a lesson learned by Classics on Demand the lesson should be that their fans aren’t as eager for subscriptions. Plus, how many of these kids are going to be able to convince their parents to cough up $60 for a subscription? If those kids were able to convince their parents to cough up $60 so easily, pay per view buyrates would be up. This is a large risk and I fail to see how they will recoup their costs and losses.
– The company is essentially telling you that pay per view is dead. Now that every pay per view will be on the network, what will that due to the pay structure in the WWE? A lot of guys make big money off of pay per view bonuses. It is well known that the biggest paydays come at WrestleMania. I think it is fair to presume that buys will dramatically decrease over time, especially with the B shows. What does this do to the pay structure? Everyone’s contract would have to be restructured at some point and what about guys who have contracts coming due? I don’t want to be dramatic but we could see a slow exodus of the big money players when contracts are due, specifically the guys that saved their money. In my mind this is the biggest story here which nobody has answered.
– With television contracts up for bid this year the WWE have been trying to push the idea that they are a sport so that they can cash in on a big sports contract. This presentation I watched clearly pushed the company as an entertainment brand. That is fine but I think there is going to be a big disconnect here when they sit down with other networks.
– NXT being on the network could be a good or a bad thing. I wrote about this in my initial blog so I’ll touch on it again. I know it is on Hulu but how many casual fans are looking for NXT on Hulu? The good could be that fans latch onto a new star from the ground floor and almost look at him or her as one of their own. “I have been watching this guy and that guy from the start.” That could be a good thing and a great way to create some buzz if you are a new talent. The bad is that these guys and girls are now being exposed to the public before they are ready. If they were ready, they’d be on the main roster. Could it taint them going forward? It also really puts creative in bind when it comes to taking talent from NXT and giving them new gimmicks. It would look kind of silly if fans were used to seeing that talent for 12-24 months and then all of the sudden they have this gimmick which doesn’t seem organic in the least. I think this is a big risk and while I understand the company needs content, I’d still keep NXT on the down low.
– Speaking of other networks, what happens when they do negotiate their new deals? What if networks demand to have RAW and/or SmackDown on their apps and websites? Sure that isn’t a problem for sports but they aren’t a sport and nobody really buys them as a sport. Will new RAW and SmackDown shows not be on the network next year if the shows move elsewhere?
– Will the company go all out with WrestleMania in upcoming years? Quite frankly I don’t know why they would. The launch of the network is in February so theoretically you’d have the bulk of subscriptions coming due in February every year. So it would be in their best interest to entice them with WrestleMania. However, what if they get to a point where the company realizes they are going to make so much money back on Mania? Do they not bring in high-ticket guys like Rock or Brock?
Those are the biggest and most important takeaways in my mind. At the end of the day this will have a much greater impact on the company than people think. The WWE product will never be the same and that could be a good or a bad thing.
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