A sports entertainment and media company World Wrestling Entertainment (wwe) (WWE -1.23%) Peacock has a special streaming relationship with — part of Comcastwho (CMCSA -1.01%) NBCUniversal segment–beginning in spring 2020. The deal gives Peacock’s premium members the ability to watch WWE’s extensive back catalog of classic wrestling matches and live events. The Royal Rumble, WrestleManiaand summerslam. However, WWE’s weekly live shows, raw and SmackDown, Still debuting on linear TV, and arriving on Mayur just a day later.
During WWE’s second quarter investor call, co-CEO Nick Khan suggested the company was open to the idea of transferring live broadcast rights. raw and SmackDown to streaming. Forging a closer relationship for both WWE and Peacock could be a smart move.
The linear TV landscape is changing
WWE negotiated this last time raw and SmackDown Agreement in 2018. raw It airs on the USA network — also owned by NBCUniversal — in a deal reportedly worth $1.3 billion over five years. of Fox Corporation Broadcast on FOX Network SmackDown In an arrangement of about $1 billion, also in five years.
raw Its three-hour runtime draws nearly 2 million live viewers per week, while SmackDown It attracts nearly 2 million during its two-hour weekly broadcast. For comparison, these figures are in the range of the average audience for a National Basketball Association game. However, with cord-cutting on the rise and some experts predicting a decline in live TV ad spending in the coming years, this may be the perfect time for WWE to move its flagship weekly shows to Peacock.
WWE is not new to the streaming space
WWE first entered the US streaming market with the WWE Network, which launched in February 2014. Within a year the WWE Network had over 1 million subscribers. But, despite that promising start, it struggled to grow. Its US subscriber base reached nearly 1.9 million in 2017.
When WWE signed its contract with Peacock in early 2020, the WWE Network had only 1.1 million members. It is estimated that 1 million of them later moved to Mayur. However, a year after the deal went into effect, Khan revealed that more than a third of Peacock’s premium subscribers watched WWE content.
Streaming services embrace live content
As Khan noted on WWE’s investor call, streaming companies are “hungry” for premium live content. Executive mentioned apple$2.5 billion deal with Major League Soccer and AmazonAn 11 billion dollar deal has been reached with the National Football League. As a provider of live programming, Khan suggested WWE is in a unique position because it attracts large audiences and operates year-round.
For NBCUniversal, its enduring relationship as a partner for the WWE Network and Raw certainly puts it in a strong position should WWE decide it’s time to jump into streaming entirely. “We talk all the time,” Khan said on the earnings call [NBCUniversal] About something happening first.”
Peacock is operating on a relatively slim budget
Comcast reported that Peacock had 1.3 million premium subscribers as of the end of the second quarter of 2022 — three months earlier. The potential to attract millions of additional viewers with live WWE weekly programming is certainly an attractive prospect for Comcast – depending on the cost of such a deal.
NBCUniversal reportedly spent more than $1 billion to secure the WWE Network rights for Peacock through 2025. Considering WWE made more than $2.3 billion last time it sold the TV broadcast rights for Raw and SmackDown, it’s fair to wonder if NBCUniversal is willing to spend. Heavy on making both shows special for peacocks. But as Khan points out, Peacock’s major streaming competitors are spending billions of dollars a year for premium live content.
WWE should make a decision to relocate raw and SmackDown For streaming only, Peacock does well to secure the rights. By its very nature, pro wrestling is scripted, meaning viewers are presented with fights and storylines that often continue for months, if not years. In a world where subscribers can cancel and add streaming services on a month-to-month basis, live WWE content could bolster Peacock’s stickiness — and its growth.
John Mackey, CEO of Whole Foods Market, is a member of the board of directors of The Motley Fool, an Amazon subsidiary. Tom Wilton has no position in any of the stocks mentioned. The Motley Fool has posts on and recommends Amazon and Apple. The Motley Fool recommends Comcast and World Wrestling Entertainment and recommends the following options: long March 2023 $120 calls on Apple and short March 2023 $130 calls on Apple. Motley Fool has a disclosure policy.