The WWE has provided details of its planned WWE Network, which it says could lead to a “doubling or tripling” of company earnings growth by 2015.
Despite fears a domestic premium pay TV network could cannibalise the wrestling entertainment firm’s long-established pay-per-view model, the WWE claimed the growing strength of its global brands and the “rising value of content” meant the opportunity existed to launch such a venture.
The network would be priced at between US$12.99 and US$14.99 per month and would land the WWE between US$125 million and US$250 million in incremental revenues and between US$50 million and US$150 million in earnings, according to WWE CFO George Barrios.
The net would run at a loss until it scored one million subscribers but would create “meaningful returns by 2015” should it launch this year, said Barrios. It could ultimately attract between two and four million subs, according to WWE research.
PPV events would still be offered on an “a la carte” basis, as well as running on the network.
However, Barrios declined to put a date on the WWE Network’s launch when asked during an investors’ call, saying: “We’re optimistic, but we’re going to get out of predicting dates.”
Earlier this month, a number of US news outlets reported cable platform DirecTV was looking at a distribution deal, though Barrios gave no word on this.
Globally, the network would be distributed using a number of models, said WWE chairman and CEO Vince McMahon.
“We believe we can achieve a significant increase in earnings based on launching a WWE network in the US and international markets, leveraging the renewal of our largest content agreements, and developing digital products such as mobile games and gamification of content, which take advantage of our presence online and in social media,” he added.
The WWE’s fourth quarter results revealed revenue of $115.1 million, compared to $112.9 million in same quarter in 2011. Net income was $600,000, up from a loss of $8.6 million the previous year.
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