The WWE announced the launch of its much-anticipated launch of its Network Wednesday night at the Wynn Hotel in Las Vegas as part of the Consumer Electronics Show occurring this week. The details impressed most and many instantly compared the WWE Network with the UFC Fight Pass.
-The network will be $9.99 month requiring a 6 month commitment.
-All 12 live WWE PPVs including Wrestlemania (which was $70 alone on PPV last year) will be on the network.
-The launch officially occurs with the RAW post-show at 8:05pm PST on February 24th.
-Similar to the UFC Fight Pass, you will get a free trial period. However, the WWE will give you just one week starting on the morning of February 24th at 6:00am PST.
-It looks like the complete WWE library will be available on-demand including past WWE, WCW and ECW PPVs.
-The network will also feature original content although Total Divas will likely stay on E! for now.
-The network will be available across almost all platforms including PS3, Xbox360, Roku, smartphones, desktops and laptops.
-MLB Advanced Media will operate the network as well as provide tech support. MLBAM also distributes all of ESPN’s online video and March Madness live games for Turner and CBS. This is in addition to what it does for MLB.
-The network will not be available around the world although it is scheduled to launch in the UK, Canada, Australia, New Zealand, Singapore, Hong Kong and the Nordics by the end of the year, early 2015.
(H/t: The Wrestling Observer)
Payout Perspective:
It’s safe to say that tonight’s announcement will turn out better than the XFL.
The WWE estimates between 800K to 1 Million subscribers to break even on this endeavor according to The Wrestling Observer. According to the LA Times, the WWE has spent over $40 million in the development of the network. There are many big things with this announcement. The first is the variety of platforms it will be available on. This will allow fans the opportunity to choose the platform they possess or desire to use for access to the WWE Network. The second is that all WWE PPVs, including Wrestlemania, will be on the Network. This is huge although many believed that this is where WWE PPVs were heading. The PPV buys for most of its B-scale PPVs were doing so-so numbers. However, many believed Wrestlemania would be left off the network because it did the best in PPV sales annually. Perhaps the decision to include it in the Network is that it would attract more subscribers, something it needs to break even here.
The $9.99 per month fee seems to be the consumer sweet spot. It’s not the price of an HBO or Showtime which may have soured fans. The six month commitment does not seem to bother anyone at this point but we will see how retention goes after the first year.
All in all if the WWE delivers February 24th, the many delays will have been worth it. More than just sports-entertainment fans will take notice of this venture. It’s another step in the direction of over-the-top content as a way around the traditional cable and satellite distributors.
In after-hours trading, WWE stock is up slightly to $16.35. The stock is at an all-time high at this point and the company is looking up as it goes into its bid for a new rights fee deal.
Obviously many have immediately compared this to the UFC Fight Pass. While there was an initial buzz for the Fight Pass, the Network now overshadows the UFC’s offering and for those that are fans of both we may see a competition between the two over which company gets their $9.99 per month.
It seems the UFC might have heard about this through the grape vine. It might explain why they rushed out Fight Pass a little early.
The UFC brass must be having nightmares right now. Could it force them to include at least include SOME PPVs to Fight Pass?
More problems for the UFC ….
BS,
A LITTLE early? 😀
It’s estimated that WWE spent roughly $40M and worked on this for almost two years to launch in February.
How much did the UFC spent on incomplete fight pass?
Spend
AK,
I agree – that’s the big advantage of the WWE Network. You get good quality shows that would otherwise cost you a lot of money. I haven’t signed up for the Fight Pass because frankly, I’m not paying $10/mo for prelim quality fights.
Hopefully this puts pressure on the UFC to sweeten the Fight Pass, but we’ll see.
All in all, I can’t complain, 2013 was a great year for free MMA. But still, more is always better.
http://www.fightopinion.com/2014/01/08/wwe-network-launch-ufc-fight-pass-five-questions/
MLBAM > Neulion
Tops,
The UFC has a long way to go before their PPVs fall to the levels of the WWE. The WWE network has the feel of a strategy that is running from PPVs, the Fight Pass has the feel of an add-on to PPVs. I don’t think that the UFC is in as dire a situation regarding PPVs as the WWE.
If someone could get WrestleMania and several other PPV events for $60 through the online network, why would they ever buy another conventional PPV again? This seems like they’re mostly abandoning PPV. Very interesting strategy. They’re taking a chance but the six month contracts offers some security and keeps customer turnover down. The network was originally supposed to be a television network but this has real potential.
I agree. Wwe network is designed to save their dying PPV sales. The UFC network is designed to carry their lowest events. Wwe has everything riding on it and the UFC has nothing to lose on theirs.
Something I would look out for with the WWE. They are still looking for a big tv deal and they can run unlimited events with their talent. Don’t be surprised if the WWE, after it built sits subscribers up, doesn’t create more events and put then on PPV. The old bait and switch. They are adding WrestleMania because it’s name value will draw people. But they can create a NEW Super Bowl of wrestling with stars and storylines and put it on PPV.
Also I wonder how they are able to under cut the PPV prices? As we have seen that has been something we haven’t seen wwe or UFC be able to do before. Maybe their PPV agreements are expiring? If so this could be a way to get a bigger cut from PPV providers. Not to mention if they are showing shows from their tv deals. That is going to hurt any tv deal they are looking for. Not sure how they are doing this with existing tv and PPV contracts.
This is a big deal. WWE is transitioning away from PPVs. Though they will still sell traditional PPVs alongside the WWE Network.
UFC is not as far down that road, but that’s because they see more $ in PPV than WWE does. WWE only has 1 big PPV event a year, Wrestlemania. It has two that reliable do ok, but not great, Royal Rumble and SummerSlam. The rest just get the same hard-core of 150k-200k wrestling fans that seem willing to buy every PPV WWE puts out there.
WWE’s strategy had been to milk that declining # of hard-cores. The new strategy is trying to grow their fanbase and rely more on casual fans subscribing to the WWE Network.
200k buy the B-level PPVs, 1M buy Wrestlemania, 2.5M watch Smackdown, and 4.5M watch Raw.
WWE is hoping to get those 1M to buy WWE Network. Obviously the 200k hard-cores will. Which means the B-level PPV buy #s will likely crash since most hard-cores will already get it on the Network.
WWE desperately needs the 1M Wrestlemania buyers to subscribe and stay subscribed all year, so they get the full $120 per year. That’s basically an extra 800k people buy 2 PPVs per year, to make up for the hard-cores only buy 2 now instead of 12 ($120 is equivalent of buying 2 PPVs).
The key is WWE keeps all the money from WWE Network (minus operating costs, of course) whereas with traditional PPV they only get half. Cable operators get half on PPVs.
This is a big deal. WWE is transitioning away from PPVs. Though they will still sell traditional PPVs alongside the WWE Network.
UFC is not as far down that road, but that’s because they see more $ in PPV than WWE does. WWE only has 1 big PPV event a year, Wrestlemania. It has two that reliable do ok, but not great, Royal Rumble and SummerSlam. The rest just get the same hard-core of 150k-200k wrestling fans that seem willing to buy every PPV WWE puts out there.
WWE’s strategy had been to milk that declining # of hard-cores. The new strategy is trying to grow their fanbase and rely more on casual fans subscribing to the WWE Network.
200k buy the B-level PPVs, 1M buy Wrestlemania, 2.5M watch Smackdown, and 4.5M watch Raw.
WWE is hoping to get those 1M to buy WWE Network. Obviously the 200k hard-cores will. Which means the B-level PPV buy #s will likely crash since most hard-cores will already get it on the Network.
WWE desperately needs the 1M Wrestlemania buyers to subscribe and stay subscribed all year, so they get the full $120 per year. That’s basically an extra 800k people buy 2 PPVs per year, to make up for the hard-cores only buy 2 now instead of 12 ($120 is equivalent of buying 2 PPVs).
The key is WWE keeps all the money from WWE Network (minus operating costs, of course) whereas with traditional PPV they only get half. Cable operators get half on PPVs.
The model is basically switching a lumpy revenue stream for a stable one. Instead of hard-cores buys 12 PPVs, and casuals only buying Wrestlemania — at $120 a year it’s basically everyone buy 2 PPVs per year.
WWE needs about 1M to break-even and keep WWE Network revenue about equal to last years PPV revenue.
Of course, if WWE can convince some of the 3M+ that watch Raw, but don’t buy Wrestlemania, then that can really be some serious extra revenue.
Most companies will trade unpredictable revenue for slightly less revenue, if it’s smooth and predictable. There’s nothing smoother than monthly subscription revenue.
WWE’s models breakdown if the Wrestlemania-only buyers just subscribe for 6 months, then cancel, then do that every year. Then they only get $60 per casual, not $120. They need 2x the revenue from the casuals to make up for sacrificing so much revenue from the hard-cores.
The hard-cores are getting an incredible deal on this. They’ll get for $120 what they were paying about $700 for.
WWE is sacrificing money from hard-cores in hopes of monetizing the casuals better.
Maybe they hope the hard-cores will use that savings to buy more merch or attend more live shows.
Seems like a great plan. But I don’t see how they can run PPV along side this. Who is going to buy a PPV for 60 when they can get 6 PPV for the same price? Only people who have no access except TV. So pretty much all their PPV buying fans will jump on this. The best part of this is 2 things I see. 1. It will get more people subscribing because now individual fans will sub when they used to chip in with 5 fans or so to get PPV. Now each will sub. 2. Making all the events affordable to more fans. Will keep more people in the loop of the story lines. When some couldn’t afford to see most PPV’s if any at all. Now they will get more money from them and keep interest which will boost tv ratings. Just like MMA. If you do not see PPV it is hard to follow what is going on and discourages some from following. Also those no. PPV peoe never see the best the sport has to offer. So I see this a very big positive. It just comes down to if they can make enough to cover the PPV loss. It’s a big win for their fans!
Its all about personal preference. Saving money is obviously a serious attraction, but at what cost. Do you want your kids huddled around a laptop watching some crappy screen with a bad feed, or do you want to watch on a huge flat screen with surround sound with a hi def picture? As technology gets better we will see more events streamed with better quality
saldathief:
You will be able to watch the WWE Network from your phone, tablets, PlayStation 3/4, Xbox 360, PC, TV, etc in 720P HD.
WWE’s PPV numbers aren’t bad enough to need to make this move now. WWE is preparing for the future. It’s a good move if they are in it for the long term to earn the 1-million subscribers and not dump it quickly if the results are slow.
Jose thats all good and dandy if you have a great high speed connection all the time, we all know how that can vary from time to time. Its so much fun when the pictures freezes right at a critical point in an event, your device freezes or reboots ect…
One of the down sides I think this has is perception of the events and fighters. When there is a big event(PPV). People treat it as a big event. People all gather together and buy the PPV. Buy food and drinks. Its an event. These BIG events also help push the imagine of the wrestlers as being a big deal and meaningful.
Will these events be such a big deal if the affordability of the network causes people not to gather to see the events? Just like UFC events. Watching by yourself isn’t as good as with a bunch of friends. Will the wrestlers get the same hype from some kid watching on his phone alone as they would if it was watched on TV with friends and feel of it “being meaningful/Big event”?
In other words. Yes they may get the subscribers. But will it have the same feel? Will people start to lose interest without that feel and hype of the wrestlers? What we are really talking about is the WWE is changing its packaging of its Stars. Even though the packaging is cheaper and convenient. It is not a pretty package. When you are selling a scripted product. You really need that feel to sell the stars and story line that keeps people interested. Just seeing who wins and loses is enough in competitive sports. But that may not be enough imo for Pro Wrestling.
If the UFC did this. It would save me to much money to not use it. BUt I cant say I would enjoy the fights as much. It would kill off the get togethers with my friends to watch the fights. So as much as I would like to save the money. I think it would hurt the UFC and fans experience watching big events like this.
“Seems like a great plan. But I don’t see how they can run PPV along side this. Who is going to buy a PPV for 60 when they can get 6 PPV for the same price? ”
Showtime used to offer their boxing content on both PPV and regular Showtime (not the biggest fights, but some of the Showtime Championship Boxing events). I worked for Directv at the time and there were actually people who would call in to order the events at $29.95, completely unaware they could just order Showtime and cancel it a week later.
Also, there are many of us (myself included), that really don’t watch wrestling at all throughout the year, and just order Wrestlemania every year and have a get together for old-times sake to laugh at the story lines. honestly, i’d rather fork over the ppv price then pay for a subscription that i’m not going to use and forget to cancel when the 6 months are up. there probably aren’t many of us, but there’s still a segment that’s going to take the one time ppv over the subscription.
Interesting is Vince McMahon’s claim that they had deals in place with the cable companies to launch a cable network at 20 cents a month per subscriber in 80M homes, but that Vince refused to sign and went over the top instead.
Personally, I think this is spin. For years the news had been that the cable carriers had been refusing to add the WWE Network to their channel line-up. So this sounds more like WWE saying we rejected them, not the other way around.
http://www.mmamania.com/2014/1/9/5291048/let-the-mma-professional-wrestling-wars-begin-wwe-network
Iiinteresting: “But what does this mean for the current negotiations? It means WWE now holds all the cards. Recent broadcasts of Monday Night Raw have averaged 4 million viewers across its three hour programming block, which also happens to be the exact amount of subscribers required to match WWE’s 2012 revenue” (http://www.forbes.com/sites/merrillbarr/2014/01/09/wwe-just-gained-full-control-over-its-broadcast-contract-negotiations/). I fully assumed this HURT the WWE’s position in the TV rights deal (after all, the Network viewers would heavily eat into the TV viewers right?), but I guess others see it differently.
$10 seems way, way too little to offer ALL programming, its entire library and ALL PPVs. Could this simply be the intro price?
BTW, anyone know when full UFC library will be available on Fight Pass? I thought the two-month trial was way too generous, as you could easily burn through every Zuffa event worth watching in that time, so I think it works out for them that it’s not all available yet. But anyone know? Season 2 of TUF Brazil if finally working now. Anyone else have trouble with that?