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WWE News: Big WWE Network updates from quarterly conference call - launch, expenses, Raw on Network?; other TV notes on NXT & Superstars, YouTube partnership

Nov 3, 2011 - 10:49:56 AM
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By James Caldwell, Torch assistant editor

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WWE's quarterly conference call with investors was dominated by WWE Network discussion, with WWE offering some new details, but also holding back on specific details they're not yet ready to disclose.

Asked when WWE plans to launch the Network, CFO George Barrios he would "take the under on six months," which confirms WWE plans to launch before WrestleMania 28 in April.

"At some point here in the future, when the time is right, we're going to give a fuller exposition of how we view the Network model," Barrios said.

WWE CEO Vince McMahon noted WWE will not be partnering with any other company to launch the Network. "No partnership. Solely owned by WWE," McMahon said. Asked if WWE is still considering a hybrid model of a traditional cable TV network and some form of an online/on-demand function, management skirted the question and stressed they are still finalizing details on how the Network will look prior to a "very big announcement" in the near future.

Included will be an increase in expenses to launch the Network, which WWE projects as $4-6 million in the fourth quarter. Asked if that range will continue throughout each quarter to maintain the Network once it launches, Barrios said he couldn't get into the cost structure yet and there are "moving parts" in place.

An interesting topic of discussion was whether the Network could over-expose the WWE brand and potentially impact TV ratings and PPV buys. WWE took an optimistic view that they believe the Network will "significantly accelerate our earnings growth" and increase demand for all of WWE's product.

McMahon said he believes the Network will increase exposure for their other TV partners, like USA Network that airs Raw, and he believes "what's good for WWE is good for all WWE partners." WWE also disclosed they have a five-year TV deal with USA Network to air Raw that runs through October 2014.

Asked if WWE will be able to air content from other TV partners (such as a replay of Raw) on the Network, Barrios said, "We're having a lot of discussions about windowing" before McMahon chimed in, "Yes!"

-- WWE management also addressed recent news of WWE partnering with YouTube to provide content through more distribution deals. "We've done some things. (There was) something recently announced around YouTube and we will continue to explore it," Barrios said. McMahon, who was highly optimistic throughout the call, said there is "more demand for our content than ever before."

-- Concerning NXT and Superstars, management said not to expect the addition of those shows to WWE's TV line-up by the end of the year. Barrios said WWE has lost $9.0 million in TV Rights Revenue in 2011 by not having the shows on TV for most of 2011.

-- Barrios disclosed WWE currently has 100,000 hours of video library content and 30,000 hours are digitized, which will make up "the first and significant programming" that goes into the Network.


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