Jim Ross opines on future of Fight Pass/WWEN

October 20, 2014

Former WWE color commentator Jim Ross had some interesting comments about the future of UFC Fight Pass as he seemed rather bullish on the future of the over the top model.  The comments come at a time when online services seem to be on the rise…or maybe on the decline depending on what you read.

In an interview with Bloody Elbow, Ross was quoted that the shift for companies such as the UFC and WWE to digital networks is a thing of the future.  Despite the rocky starts for each, he believes that it is a “genius-like maneuver.”

With last week’s announcements that HBO and CBS were offering online services and ESPN providing a streaming-only service for NBA content the week before, it’s apparent that over the top (OTT) network offerings are the growing trend.  But, is there enough of a market for them? Although the model seems to be geared toward cord cutters, it would seem that the addition of so many subscription services would negate any savings from cancelling a traditional cable package? Would it impact ad revenue?

Payout Perspective:

The WWE will make its quarterly earnings call on October 30th and we will see how much of a dent it has made in its goal of 1 million subscribers to its OTT WWE Network.  You may recall it made a meager increase in its goal last quarter.  The last report this summer indicated that it had added just 33,000 subscribers for approximately 700,000 total subscribers.  Even with the addition of an international market, it is unlikely that the 1 million goal could be met. This should be something that other OTT subscription services should take notice.

On the other hand, all reports suggest that the UFC Fight Pass is doing well (although no numbers have been revealed).  But, unlike the WWE, it keeps its PPVs separate from the network.  Fight Pass is geared for the hardcore fan and it would be hard to argue that it takes away from the UFC’s PPV buy rate.  While Fight Pass offers an extensive fight library and live fights from overseas, most of the marquee names and match-ups remain on PPV.

So, will digital networks like the WWE Network and UFC Fight Pass thrive in the future?  Perhaps for the young, cost-conscious consumer that is savvy enough to deal with the online world but do not want to be tied down with a traditional cable package.  But, it’s unlikely to take over.

WWE announces ads on network

October 13, 2014

The WWE announced today that it is beginning to run limited video advertisents on its WWE Network.  The subscription-based over the top network is seeking additional ways to monetize the product and the ads are a way that my aid the lagging subscriber numbers.

An email was sent to WWE subscribers today advising of the ads.  It gave specifics:

• No commercial breaks during scheduled programming
• Limited advertising between shows
• Occasional advertising before our video-on-demand content

Ad Age reports that Pepsi, Mattel and Kmart are signed on for the display of ads on the WWE Network.  The report indicates that media buyers are questioning the placement of ads on the network.  While the ads may reach an audience of young males, there is skepticism about the growth of subscribers leaving some potential advertisers wondering if it would be more prudent to advertise on the WWE’s network shows.

Payout Take:

The ad announcement will be interesting to see in terms of its success and how many advertisers decide to sign on with the network.  Certainly, ads would be something that UFC Fight Pass might entertain in the future.  But, there may be concern that advertisers would annoy subscribers.

The Wrestling Post – 09.21.14

September 21, 2014

Welcome to another edition of The Wrestling Post.  In this post we’ll catch up on Total Divas ratings and the WWE brokers a new television deal in Latin America.

Total Divas Ratings –Season 3, episode 2

The second episode of the third season of Total Divas did just 974,000 viewers with a 0.5 rating.  It’s a decrease from the debut episode for the third season which drew 1.2 million viewers.

Payout Take:  Without a Kardashians lead-in on the E! Network, Total Divas is finding it hard to grab its own audience.  It also doesn’t help that it is up against the NFL and other must see Sunday night television.  Don’t expect a huge uptick this Sunday as it goes up against a WWE live event on the network.

WWE and Fox Sports Latin America announce 5 year pact

Earlier this week, the WWE announced a deal with Fox Sports Latin America.  The 5 year deal includes Fox Sports Premium platforms across all of Latin America which will make WWE programming available in 56 million homes.  The deal begins October 6th with WWE airing Monday Night Raw across the Fox networks.

Payout Take:  The move into countries like Mexico, Brazil, Argentina, Columbia and Venezuela will help with its global footprint.  It will also help with the future proliferation of the WWE Network.

Total Divas Season 3 Ep 1 posts 1.2M viewers

September 9, 2014

Television By Numbers reports that the debut of the third season of Total Divas on the E! network scored an average viewership of 1.2 million viewers with a 0.6 rating in the adults 18-49 demo.

Total Divas went up against the seventh season of HBO’s Boardwalk Empire which scored 2.37 million viewers and was shown in the same time slot as the WWE reality show about its women wrestlers.

The ratings are Live plus Same Day Viewing.

The season premiere was up 15% versus the season 2 premiere according to an E! press release.

Payout Perspective:

Strong ratings considering it did not have Keeping Up With the Kardashians as a lead-in.  It also did well considering it went up against Boardwalk Empire and Sunday Night NFL Football on NBC.  The WWE is starting to infuse Total Divas storylines with its WWE programming storylines which allows for crossover viewership.  Can we see more males tuning into Total Divas due to the crossover with Raw and Smackdown?

Ross and Sonnen chosen as broadcast team for Battlegrounds MMA PPV

September 4, 2014

Former WWE broadcaster Jim Ross and Chael Sonnen will be calling the live PPV telecast of Battlegrounds MMA from Tulsa, Oklahoma on October 3rd.  The PPV is $19.95 in the U.S. and Canada.

Via BattleGrounds MMA press release:

Two consummate performers in WWE Hall of Famer Jim Ross and recently retired UFC superstar Chael Sonnen have teamed up to form what is bound to be one of the most memorable commentary teams in sports entertainment history, and will call the world-class Mixed Martial Arts (MMA) action on the LIVE pay-per-view telecast of BattleGrounds MMA: ‘O.N.E.’ from BOK Center in Tulsa, Oka. on Friday, October 3.

Headlined by the first one-night, eight-man tournament in Tulsa since UFC 4 in 1994, BattleGrounds MMA: ‘O.N.E.’ will award its welterweight (170 pounds) winner a grand prize of $50,000.

BattleGrounds MMA ‘O.N.E.’ will be distributed at a price point of $19.95 in the United States and Canada by Integrated Sports Media for live viewing, beginning at10 p.m. EST/7 p.m. PST on October 3 on both cable and satellite pay-per-view carriers iN DEMAND, DirecTV, DISH and Avail-TVN in the United States and Bell TV in Canada.  A pre-show will begin at 9 p.m. EST/6 p.m. PST.

“As a longtime fan of MMA, to be asked to call the fights for the BattleGrounds MMA event is amazingly exciting for me,” said Ross, a 2007 WWE Hall of Fame inductee.  From commentator to referee to executive and even occasional wrestler, Ross has played a multitude of roles for the world’s leading professional wrestling league.

“I’ve broadcast NFL and XFL games,” continued Ross, “FOX Sports boxing and WWE action, but MMA is a new adventure and one that I’m enormously excited about contributing to. To launch this phase of my broadcasting career in my home state, and with Chael Sonnen at cageside makes it an ideal opportunity and a bucket list experience.

“This is going to be a TV event that any MMA fan won’t want to miss,” said Sonnen, who recently retired from the sport that he competed in as a professional since 1997.  A three-time UFC championship challenger, Sonnen fought his last 11 career bouts inside The Octagon and enjoyed a stint as an analyst for FOX Sports Network.  “I am thrilled to be working with a legend like Jim Ross and, together, we are going to make the BattleGrounds MMA event one of the most exciting extravaganzas in combat sports history.”

Payout Perspective:

The card features a one night tournament featuring eight welterweights including former UFC fighters Cody McKenzie, Brock Larson and Luigi Fiorvanti.   Obviously the selling point is Ross and Sonnen as the announce team rather than the actual card.  It will be interesting to see how many buys this drums up for the organization.  One has to think that this has to be a “break even” situation for the company in hopes of future success.

The Wrestling Post: Lucha Libre reality show created by maker of Survivor

August 28, 2014

Variety reports that Mark Burnett, the creator of the reality show, “Survivor,” has a new show which follows Lucha Libre wrestlers which will air on the El Rey Network.  “Lucha Underground,” is an hour long show which will feature five Luchadores from the AAA promotion in Mexico.

According to TV By The Numbers which has the original press release, shooting for the show begins in Los Angeles next week with a premiere date of October 8th.

The El Rey Network is owned by NBCUniversal and targets Latino audiences.  It is available on Comcast, DirecTV and Time Warner Cable.

Payout Take:  If you recall, Mark Burnett created “The Contender,” a short-lived reality show about boxers trying to make it.  Although not widely distributed, this should be an interesting show to give a chance.  It definitely caters to the Latino audience as Lucha Libre is popular in Mexico as the Variety article cites that Lucha Libre draws over 85% of Mexican television viewers.

The Wrestling Post – 08.13.14

August 13, 2014

Welcome to another edition of The Wrestling Post where we write about the WWE Network launching overseas and the news that tickets demand are lowest in four years for Summerslam.

WWE Network launches overseas

The official launch of the international over the top network went live this week as it was made available in 170 countries outside of the United States.  The hope is that it will pick up much needed subscribers after meager additions after the company’s second quarter.  In addition, in order to entice fans that do not want a longer commitment, it is offering two other tiers of subscription.

Via WWE press release:

The U.S. English language version of WWE Network is now available, on an over-the-top basis, in more than 170 countries and territories, including Australia, New Zealand, Hong Kong, Singapore, Mexico, Spain, and the Nordics, among others. The network is expected to be live in the U.K. by this October and plans for the network in Italy, UAE, Germany, Japan, India, China, Thailand and Malaysia will be communicated at a later date.

For $9.99 (U.S. dollars) per month with a six month commitment, fans have access to 24/7 programming, all 12 live WWE pay-per-view events, and the most comprehensive video-on-demand library. In addition, subscribers can now choose a monthly offering at $12.99 (U.S. dollars) with no commitment and the ability to cancel at any time. The $12.99 price point is a change from the previously announced $19.99 monthly plan and allows WWE to offer an option with no commitment that we believe better reflects the variety of economies that exist internationally.

Payout Take:  We will see how many subscribers latch on to the WWE Network.  Overseas growth had been key in the past for WWE traditional businesses.  Certainly, the WWE hopes that proves the same with its network.

Summerslam Ticket prices lowest in 4 years

In addition to the WWE Network subscriber disappointment, tickets for this Sunday’s big event, Summerslam, ticket demand for this year rivals that of UFC 174.

Via Forbes.com:

According to TiqIQ, the average price for SummerSlam is currently $205.99 with a get-in price of $67, both lows since 2011. Last year the average price was $213.71 with a get-in price of $71. Neither year come close to the peak from 2011 and 2012, which had average prices of $248.31 and $249.64, respectively, with a get-in price of $75.

Payout Take:  Take it for what it’s worth as the article was written by the CEO of TiqIQ and he sources his own company for the ticket information.  Summerslam 2014 is likely not as bad as UFC 174, but if we assume that the ticket demand is down from last year, it reflects a bad spate for the WWE.  Even with Brock Lesnar-John Cena in the main event, the interest appears to be off for this year if we are basing it on the ticket demand.  Due to cost-cutting measures from the expenses incurred from the WWE Network, the WWE did away with its mini-exhibition, Axxess, during Summerslam although it will have a scaled down version.

SBJ reports on WWE Network for OTT feature

August 10, 2014

The Sports Business Journal (subscription required) reported on the WWE’s launch of its network as part of its feature last week on Over The Top (OTT) networks.  The article compliments another within the same issue which talks about the new platform in general.

The article on the WWE reports on the tumultuous time it has had with the launch of the network.  Upon the announcement in January, there was much anticipation.  But, after the initial numbers came out coupled with the general disappointment  the rights fees deal caused the stock to drop and momentum to stop.

The WWE did receive some interesting information from the first few months from subscribers.  Despite being off on its projections, the subscribers that have the network are very satisfied with the network.  Many utilize the network at least once a week.  Also, Xbox and Playstation are the two platforms used by most subscribers.  This last part of information would suggest that a younger demo has purchased the network and maybe not as many older viewers (those that one would presume would subscribe for the older content) have the network.

Payout Perspective:

The overarching theme about OTT is the direct competition it has with traditional platforms.  At this point, OTT does not offer live sports with the exception of the WWE Network.  No big revelation in the article about the WWE.  Although the number of subscribers did not hit its target, the users that have it like it. What may be lacking is the older demo that the WWE thought would have been brought in by the vast WWE library.

WWE reports second quarter earnings, Network sub update

July 31, 2014

WWE announced its 2nd Quarter earnings on Thursday.  The big news was that the WWE Network added just 33,000 subscribers from the 1st Quarter.  In addition, it reported laying off 7% of its work force.

While the number of subscribers is off from the company’s initial projections, the WWE indicated that the existing subscribers are happy with it.  The company indicated that the Network will roll out in its present form internationally.

Similar to how the UFC introduced pricing options for Fight Pass, the WWE will also roll out options to its current payment plans.  Fans can now pay $19.99 per month with no commitment to renew.  This is likely to grab those wanting to order specifically to watch a “PPV” event.  The other new option is that one can pay one time the $9.99 x 6 months.  These two options will be in addition to the current $9.99 per month plan with a 6 month commitment.

The WWE also announced a 10 year deal with Rogers  Communications in Canada for the Network to be a traditional pay-tv option.

Overall, WWE reported a Net loss of $14.5 million, or $0.19 per share compared to last year’s second quarter net income of $5.2 million or $0.07 per share.  The wide swing is due to the costs for the Network.

Payout Take:  WWE stock was up slightly to $12.48 on Thursday.  Unfortunately, when a company cuts jobs, the stock experiences a positive bump due in part to the belief that the company is addressing issues with excess.  The Hartford Courant states that 53 of the 762 positions with the company would be cut.  The article also states that the cuts “along with other efficiencies” should improve the operating income by $30 million (before depreciation and amortization) in 2015.

As for the Network, the number of gained subscribers at this point suggests that it will not reach its targeted goal of 1 million by the end of the year.

The Wrestling Post: Ventura wins defamation case

July 31, 2014

On Tuesday this week, a Minnesota jury found in favor of former governor and professional wrestler Jesse Ventura in a defamation case against the estate of a former Navy SEAL that wrote in his best-selling book about a fight with Ventura.  The jury awarded Ventura $1.8 million.

Ventura won $500,000 for his defamation claim as he denied getting into a fight with Chris Kyle, a former member of the Navy SEALs and elite sniper.  He also won $1.3 million for unjust enrichment.

Essentially, the book, “American Sniper: The Autobiography of the Most Lethal Sniper in U.S. Military History,” written by Kyle included a part wherein he talked about an encounter at a bar in Coronado, California where a “celebrity SEAL” was talking a little too much.  In the book, he was referred to as “Scruff Face.”  Kyle stated that he punched him.  It came out in media interviews promoting the book that the “celebrity SEAL” was Ventura.

Ventura sued in 2012 and continued the suit against the estate of Kyle after Kyle died in a shooting at a Texas firing range. He claimed that the book caused him to lose earnings and alienated him from the SEAL community

Source:  NY Times

As a public figure, the standard for proving defamation is higher than that of a private person.  Ventura is considered as a public figure for a variety of reasons including formerly holding public office, performing as a wrestler and hosting a variety of television shows.

In honor of those that have taken the bar this week, here are the factors for defamation:

  1.  There must be a statement that has been published;
  2. The statement is false; and
  3. The false statement must cause injury.

For a public figure, like Ventura, to win a defamation claim, he must prove that the writer had knowledge that the information was false.

Payout Perspective:

There’s no indication that the estate of Kyle will appeal the ruling. It appears that insurance paid the defense for Kyle’s estate and presumably will pay the verdict.  Ventura states that the jury award will essentially pay off the lawyers.  The jury deliberated several days after closing arguments which some suspected that Ventura had proved his case and it was a matter of how much he would receive.  It would be interesting to know the evidence which showed that the incident retold in the book was false.

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