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Netflix will stream WWE Raw starting next year in its biggest leap into live entertainment

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TKO CEO Ari Emanuel: Netflix deal strengthens WWE brand 'globally'

Netflix And Participations of the TKO group said Tuesday that the streaming platform will air WWE’s flagship program “Raw” starting next year, as part of Netflix’s first major foray into live sports.

The deal, lasting 10 years, is valued at more than $5 billion, according to a company filing. Netflix will have the option to end the deal after five years and extend it for another decade. The streaming platform will be able to broadcast “Raw” worldwide and will begin the deal with exclusive rights to it in the United States, Canada, United Kingdom and Latin America. Netflix will also become the home for all WWE shows and specials outside the United States, including “SmackDown” and “NXT,” as well as “WrestleMania,” “SummerSlam” and “Royal Rumble.”

Shares of TKO soared more than 15% following the news and separate announcement that actor and former wrestling superstar Dwayne Johnson would join its board of directors. Netflix shares rose about 1%, ahead of the company’s fourth quarter. income report after the bell Tuesday.

Netflix, which attempts to generate revenue by reducing subscription sharing and pushing viewers toward its advertising-based membership, has made few attempts at live programming in its history. The addition of “Raw,” which currently airs on USA Network and produces three hours of live programming per week year-round, to its lineup will be a boon for the platform and a significant historic shift for Netflix.

“This is a game changer,” Mark Shapiro, TKO’s president and chief operating officer, said in an interview. “When you look at the chapters of sports media history, new chapters are driven by extraordinary new paradigms. ESPN and Turner brought the NFL to cable in 1987. Rupert Murdoch brought football to Fox in 1994. When new stories are written, Raw on Netflix will be a real start to a chapter.”

Netflix has recently moved into sports with documentary-style series on Formula 1 and professional golf, tennis and football. This agreement will allow Netflix to exploit WWE’s intellectual property for similar projects. With WWE’s permission, Netflix could even develop films or series around WWE characters, a person familiar with the matter said.

For TKO, WWE’s parent company, striking a deal with Netflix brings WWE wrestling to approximately 250 million subscribers worldwide. WWE Chairman Nick Khan has had Netflix on his radar as a potential landing spot for “Raw” for several years.

He discussed the world’s biggest streamer during a WWE Q1 2022 earnings call, referencing how Netflix has shown openness to changing its long-held positions, such as rejecting the advertising and the crackdown on password sharing. As recently as December 2022Netflix co-CEO Ted Sarandos said at the UBS Global TMT conference that Netflix had not “seen a profitable path in big sports rentals.”

“Netflix is ​​prepared to make adjustments and reverse its positions when it identifies a problem,” Khan said in 2022.

Choose Netflix

TKO has had discussions with other media companies but focused on Netflix in December, according to people familiar with the matter.

Netflix’s global footprint, which exceeds all other streaming services, has been a key draw for WWE, Shapiro said.

“It’s one of the biggest entertainment platforms in the world,” Shapiro said of Netflix. “It has marketing that you can’t even understand. It has unprecedented positioning in terms of what they do on the front page.”

Netflix announced earlier this month that it had 23 million monthly active users for its ad tier, which the company launched in November 2022. Matches will be scripted around commercial breaks to satisfy ad-free customers, who will see continued action from live matches that are not broadcast. It’s not important to the outcome, like a wrestler in a sustained headlock, according to a person familiar with the matter.

“Raw” is the U.S. cable network’s flagship program, attracting 17.5 million unique viewers annually, the companies said. Shapiro said Amazon’s ability to stream “Thursday Night Football” this season without issue and Peacock’s recent success in streaming a National Football League playoff game gave him confidence that Netflix will stream “Raw” on technologically, even if it did nothing of the sort. on a consistent basis again.

Disclosure: Comcast NBCUniversal, the parent company of CNBC, owns USA Network.

Clarification: This story has been updated to reflect that Netflix reported having 23 million monthly active users for its advertising tier.

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