The WWE celebrated the one year anniversary of its network on Tuesday by allowing all free access to its network. Variety also posted an article summarizing what the company learned with its over the top network.
Its clear that the Network is inextricably tied with the company’s future financial performance as it is stated in the WWE’s latest earnings report that the company’s future financial performance is dependent on subscription adoption of the WWE Network.
The company surprised analysts by besting Wall Street expectations for the fourth quarter and all of 2014. While the company has incurred a net lost due primarily to the large investment in the network, it has not been as heavy as previously predicted.
As it reported in January, the network surpassed 1 million subscribers and is picking up more viewers as it rolls out in more foreign companies. It has also done well with its promotions for the network including a free November and allowing subscribers to pay mont-to-month rather than establish a 6 month commitment as it was originally rolled out.
Variety cited 4 lessons the WWE has learned since its launch last February. Among the lessons it indicated the “balancing act” the company had with its “direct-to-consumer” initiative while maintaining its partnerships for distribution. Essentially, this means keeping the people paying for its television rights fees happy as while as having amicable relations with the cable and satellite company. The latter being a harder balance considering the company has cut into PPV revenues. It also may have angered companies by playing most of the Royal Rumble last month during an episode of Raw due to the live event cancellation as a result of snow.
Payout Perspective:
The WWE Network has had measured success despite criticism about the product. It may have not met its lofty expectations of subscribers yet but one may have to wait to see how it fares with international distribution. For its part, the WWE has been willing to make changes on the fly to the network (i.e. Free November, month-to-month payment, content, convenient options for viewer usage, etc.) It was a bold move for the WWE to take this step to create the network and the early adopters have spoken. In year 2, we will see if more subscribers add on, or if the Network will face more hurdles for subscribers and retention.
one year is hardly a point of celebration for any new venture, try in 3 to 5 and then lets see.