Is Professional Wrestling Re-Defining How We Watch TV?

Todays top stocks to buyAlways one to push the boundaries of sports entertainment, World Wrestling Entertainment (NYSE:WWE) has done it again by taking their content digital…

There really is no other business quite like it.

Whether it’s a true sport or a testosterone-laden soap opera, only its rabid legion of fans around the world can tell you.

Week-in and week-out, millions of the World Wrestling Entertainment (NYSE:WWE) loyal tune into its roster of multi-hour shows on cable TV, including Raw and Smackdown, to watch male and female physical specimens duke it out whilst clad in spandex and speedos.

Then, at least once per month, WWE produces a pay-per-view spectacle to tie up all the storylines that are created in the weekly episodes — with the crowning event of the year being the legendary WrestleMania.

It’s a successful formula that has earned the Company tens of millions of dollars in profit every year for decades.

From the time the original World Wrestling Federation (WWF) was conceived back in March 1979, its founder Vincent K. McMahon already had his sights set on revolutionizing the business.

His immediate goal was to get WWF programming on syndicated television across the entire country, a feat which had never been attempted…much less conceived by the dozens of other wrestling promoters in existence at the time.

Within a few short years, McMahon was pulling in revenues from TV deals, advertising, and videotape sales.

As a result, he was able to lure many of the most popular wrestlers in the wrestling circuit to the WWF, including Hulk Hogan, Rowdy Roddy Piper, Jesse “The Body” Ventura, André the Giant, and others.

Then came the introduction of WrestleMania in 1985, which set the WWF on the path of industry domination.

Not content with merely emulating how other promoters organized a “supercard” event, McMahon took WrestleMania to uncharted territory by attracting non-wrestling fans.

He did so by hiring celebrities such as Mr. T, Muhammad Ali, and Cyndi Lauper to be a part of the event — effectively blurring the lines between sport and entertainment.

This strategy has been deployed successfully ever since.

Its various programming and live shows are seen in 150 countries by 650 million people. It even held its first live event in Saudi Arabia in mid-April.

But knowing the WWF (now WWE), it’s constantly in search of new experiments to grow and extend its brand.

Some of the ventures have worked out extremely well (e.g. toy and clothing merchandising), while others have not (e.g. World Bodybuilding Federation, XFL).

But this past February, in what’s arguably the WWE’s most ambitious project to date, the Company didn’t just take wrestling to another level — it may have very well changed the way the world watches TV for good…

All Wrestling, All The Time

On February 24, 2014, the WWE officially launched the WWE Network, a 24/7 online streaming network (http://network.wwe.com).

For $9.99 per month, subscribers can access past and present WWE shows, including pay-per-views and archived footage going back to 1979.

The programs could be watched on the Internet, through its smartphone app, and on streaming devices like Roku and Apple TV.

Even last month’s historic WrestleMania XXX was made available on the Network at no additional cost to subscribers.

As far as niche sports channels go, no other networks come close.

Both the NFL and MLB networks charge over $20 per month, but arguably offer less content.

This explains why the uptake has been fast and furious since its unveiling.
When the WWE Network was first announced, the Company predicted that it would sign up around a million subscribers in 2014…six weeks later, their subscriber base had surpassed 667,000.

At this pace, the WWE predicts they are well on their way to obtaining its 1-millionth subscriber by the end of 2014. They expect to sign up around 3 million subscribers over the next few years.

Strangely enough, even with the $9.99 per month subscription giving people free access to WrestleMania XXX, 400,000 households still paid $65 a pop to watch it on pay-per-view.

With the WWE moving to online access, viewers will soon find it irrational to shell out for one paid event, when they can subscribe for six months of WWE Network and get access to all events for pretty much the same price.

Pay-per-views may not see any immediate threat while the WWE slowly transitions away from the format. After all, there are plenty of sporting events such as boxing and the UFC that still bring in huge PPV numbers.

That being said, cable companies are monitoring the growth of the WWE Network very closely.

If it reaches a point where more revenues are generated by way of monthly subscribers instead of PPV, we could witness a revolutionary shift across entertainment industries towards subscription-based models.

Yours in profits,
Todays top stocks to buy
John Holt
for Top Stock Millionaire
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