Netflix and TKO Group Holdings announced Tuesday that the streaming platform will carry WWE’s flagship show “Raw” starting next year, marking Netflix’s first major foray into live sports.
The 10-year deal is worth more than $5 billion, according to company filings. Netflix will end the contract after five years, with the option to extend it for another 10 years. The streaming platform will now be able to stream “Raw” worldwide and will begin agreements for exclusive rights in the U.S., Canada, the U.K. and Latin America. Netflix will also be home to all WWE programming and specials outside the U.S., including “SmackDown” and “NXT,” as well as “WrestleMania,” “SummerSlam” and “Royal Rumble.”
TKO stock soared more than 15% following news that actor and former wrestling superstar Dwayne Johnson would join the company’s board of directors and another announcement. Netflix stock rose about 1% after the bell on Tuesday ahead of the company’s fourth-quarter earnings report.
Netflix has been trying to increase revenue by cutting back on subscription sharing and driving viewers to ad-tier memberships, but so far there has been little attempt at live programming. Adding “Raw,” which currently airs on USA Network and where he produces three hours of live programming a week throughout the year, to the programming lineup is a boon for the platform and a significant historic change for Netflix. Sho.
“This is a super game changer,” TKO president and chief operating officer Mark Shapiro said in an interview. “As we look back at chapters in sports media history, new chapters are driven by startling new paradigms. ESPN and Turner brought the NFL to cable in 1987; Rupert Murdoch brought football to FOX in 1994; “When a new history is written, Raw begins on Netflix” will be the start of such a chapter. ”
Netflix has also recently dabbled in sports with documentary-type series about Formula 1, professional golf, tennis and football. The deal will allow Netflix to leverage WWE’s intellectual property for similar projects. With WWE’s permission, Netflix could also develop films or series based on WWE characters, according to people familiar with the matter.
For WWE parent company TKO, the deal with Netflix means WWE Wrestling has approximately 250 million subscribers worldwide. WWE Chairman Nick Carn has been eyeing Netflix as a potential destination for “Raw” for several years.
He spoke about the world’s largest streamer during WWE’s Q1 2022 earnings call, noting how Netflix has shown a willingness to change long-standing positions, including refusing ads and cracking down on password sharing.Recently too December 2022Netflix co-CEO Ted Sarandos said at the UBS Global TMT conference that Netflix “doesn’t see a profit path for major sports rentals.”
In 2022, Khan said, “Netflix is willing to make adjustments and reverse positions if we identify problems.”
Choose Netflix
TKO held talks with other media companies, but narrowed its focus to Netflix in December, according to people familiar with the matter.
Shapiro said Netflix’s global reach over all other streaming services was a key attraction for WWE.
“This is one of the best entertainment platforms in the world,” Shapiro said of Netflix. “It’s doing marketing that you can’t even fathom. It has unparalleled positioning in terms of what it’s doing on the front page.”
Earlier this month, Netflix announced that the company’s advertising inventory starting in November 2022 has 23 million monthly active users. To satisfy ad-free customers, matches will be scripted during commercial breaks, and ad-free customers will see continuous action in live matches. A person familiar with the matter said it was not important to the outcome, as the wrestler continued in a headlock.
“Raw” is the top show on U.S. cable networks, drawing 17.5 million unique viewers annually, the companies said. Shapiro said Amazon’s ability to stream “Thursday Night Football” this season without any issues and Peacock’s recent success streaming National Football League playoff games, even if He said he was confident that Netflix would have a technically sound “Raw” stream even without it. Still on a consistent basis.
Disclosure: CNBC’s parent company, Comcast NBCUniversal, owns USA Network.
Description: This article has been updated to reflect that Netflix said it has 23 million monthly active users in its advertising tier.
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