• by Wayne Friedman , January 23, 2024

Moving more into sports-adjacent entertainment in a big way -- and looking to boost its nascent advertising business -- Netflix has announced a major $5 billion, 10-year deal to be the exclusive partner for WWE’s content, according to company filings.

This included its “Raw” programming. The deal covers the U.S. and Canada, the U.K. and Latin America, starting in 2025.

Netflix’s deal takes over from NBCUniversal’s USA Network, which previously had the rights to “Raw” and “NXT.”

NBCU’s Peacock has a separate deal with WWE’s “Smackdown.”

Wells Fargo Securities says that for “Raw,” it estimates 1.7 million viewers in the U.S. for Netflix for its three hours of weekly programming.

This, coupled with impressions gains from “NXT," could yield $260 million in annual revenue -- this coming from a $30 CPM (the cost per thousand viewers).

“Netflix’s number one focus is driving scale in ads as it needs reach and frequency to carve out a seat at the top table with U.S. ad buyers,” writes Steven Cahall, media analyst at Wells Fargo. 

“WWE is watched by nearly 2 million viewers for 2 plus hours a couple of nights/week, around 50 weeks per year. The biggest challenge is it's a narrow demo, so Netflix might look for more live content to further expand its reach.”

The biggest question for investors continues to be: When will Netflix step up to make a major deal for major live sports programming? “We think that's still years away given the gap between major sports rights and a WWE deal at $500mm annually.”

Analysts say Netflix effectively takes over other programming which had been on the WWE Network streaming service, a platform that airs live events including “Smackdown,” “NXT,” “WrestleMania,” “Royal Rumble” and “SummerSlam.”