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WWE negotiating content deal in Indian market
MUMBAI: The World Wrestling Entertainment (WWE) is in the midst of negotiating a content deal in India. ZEEL-owned sports network Ten Sports holds the broadcast rights for India till the end of 2014.
The company expects to increase the average annual value of its key television agreements (including the one in India) to approximately $200 million, representing an increase of more than $90 million which is nearly three times the increase achieved in the previous round of negotiations.
Ten Sports had renewed its agreement with the WWE in 2008 for a period of six years. While the financial details of the deal were not revealed, it is believed that Ten Sports had committed $12 million for the rights.
Over the past six months, the WWE has negotiated television distribution agreements in key markets like the US, UK and Thailand.
Earlier this month, NBC Universal Cable Entertainment and the WWE had signed a multi-year strategic partnership for the US market. In the UK, BSkyB has secured the WWE rights for a period of five years while in Thailand CTH has sealed the rights for a period of five-years.
In India, the WWE has been the backbone of Ten Sports since the channel launched in 2002. It is the content that gives the channel reach and visibility week in and week out. The WWE keeps doing promotions and earlier this year brought down one of its stars Big Show.
For the record, Sony’s sports entertainment channel Six airs the WWE’s rival TNA Wrestling.
Given the anticipated increase in television rights, and with successful WWE Network subscriber growth, WWE management continues to believe that the company can achieve significant earnings growth, potentially doubling or tripling 2012 OIBDA results to a range of $125 million to $190 million by 2015.
WWE chairman CEO Vince McMahon said, “We continue to achieve significant increases in the value of our largest television agreements, a key component of our business plan. The rising value of our content coupled with the global expansion of the WWE Network will provide the foundation for long-term growth that continues to transform our business over the coming years.”
The company’s consumer research indicates a high proportion of the US and international broadband users have an affinity for WWE content. This research indicates that in the US and certain international markets, approximately 50 per cent of broadband households have an affinity for WWE content, representing 77 million homes (WWE homes) in these markets.
The company’s research also indicates that based on an overall take-rate of three to five per cent of WWE homes in these markets, between 2.5 million and 3.8 million subscribers could subscribe to the the WWE Network in these US and international markets at a ‘steady state’ (when the ramp-up of subscribers has been completed and subscriber levels are relatively stable), representing a sizable economic opportunity.