By Richard D Chadwell
Sports and Entertainment Correspondent
When the WWE Network was first announced two years ago many critics dismissed it saying that the venture would struggle to attract subscribers to its niche network. That it would damage its PPV product and be an albatross around the neck of chairman Vice McMahon. Those critics are hard to find these days. At the most recent shareholder’s meeting for World Wrestling Entertainment there was a great deal of information about how the network is doing. As far as the company is concerned the network is doing very well. At the close of the 4th quarter the WWE Network had 1.22 million paying subscribers rest at $9.99 a month. This represents a 49% increase for the company when compared to the 4th quarter of 2014. The high water mark for the WWE during the quarter was 1.24 million. The network also posted record revenues for the year with network segment generated revenue of $159.4 million and OIBDA1 (what is OIBDA) of $48.4 million. That’s nearly double the average annual revenue gleaned from the company’s pay-per-view business prior to the launch of the network. While the profit is still behind where the pay-per-view business was it is not hard to imagine that it will surpass the mark in the future.
For instance, the last WWE WrestleMania before the WWE Network launched had over 1 million orders. At 1 million in the Pay-Per-View system at $59.99 a buy would have produced $59,990,000. This year if we use the 1.22 million at $9.99 that would generate $12,187,800. Now this looks like the WWE is making a huge mistake, they just lost close to 48 million on their biggest product right? However, if you look at the total year mark, which the WWE has consistently been above 1 million subscribers for the better part of a year now that means the network has made 119,880,000 in one year. This 1.22 subscriber number should hold. Outside of the WWE’s 4 marquee events the majority of the company’s 12 PPV events were sold at a lesser price of 49.99, and they generally the other big 4 did around 500,000 on good years and 300,000 on less good years. The other 8 would generally do even less ranging from 150,000 to 250,000. So, while yes they lose money on WrestleMania for the time being, they are doing better than most all of their lower shows and getting close to the big 4. One thing also to consider is that with the pay-per-views, they do not get to keep all of the money, this was split amongst the cable providers. While with the network, they obviously get to keep all the money. They also did not have to do anything extra for the network to get pay-per-view quality broadcasts.
Other measures of success for the network
The WWE Network is the 5th highest selling (OTT) video Service, behind, Amazon Video, Hulu, MLB Network, and Netflix. It produced over 330 hours of original programming, and increased it’s vast on-demand library by over 4300 hours. What this tells us, is they have much more content to explore. In fact it has barely scratched the surface of the amount of content they have.
Those who have it love it.
If you are a WWE Network subscriber you have to be a true believer and the numbers bare that out. The report said that the network was viewed for over 256 million hours in 2015, or 188 hours per unique household. That 188 hours would put it ahead of virtually every traditional network that consumers watch on their TV. Only CBS, Univision, ABC, and NBC are the only channels that get more individual viewing.
The WWE Network I feel is a great success. The company is looking to expand into China and Thailand after recently expanding to Germany, Austria, Switzerland, and Japan in January of 2016. Market watchers might expect the network’s numbers to stagnate this quarter as compared to last year’s overall gain. This is because the Network sees its largest boost in subscribers in the lead up to WrestleMania. It will fall in the second quarter this year, April 3rd to be specific. The company states that by 2021 they could have 4 million subscribers. I feel like with all this information the best is to come for WWE.
For a full breakdown of the numbers check out the report from the WWE corporate site here.
Richard Chadwell is a special contributor The Streaming Advisor with an expertise in Sports based on over 15 years of professional work as an official his other interests include films, television and politics. Look for more articles by Chadwell here at The Streaming Advisor. Interested in contributing to The Streaming Advisor contact us at email@example.com.