Is the WWE and Netflix Deal Good for AEW?
Will the recent alliance between WWE and Netflix signal a significant setback for AEW (All Elite Wrestling)? The answer is not so black and white. On one hand, WWE's exclusive deal with Netflix could limit AEW's growth and visibility, particularly in international markets. On the other hand, it offers some relief for AEW, as WWE's deal may make it less likely to face massive changes in its broadcasting landscape.
Why the Netflix Deal Matters for WWE
WWE's signing with Netflix is a milestone deal worth $5 billion over a ten-year period, starting in January 2025. This deal allows WWE access to a vast international audience and enhanced visibility. In addition, Dwayne “The Rock” Johnson, a key WWE asset, is named to the TKO Board of Directors, enhancing WWE's brand equity.
The news sent WWE's stock soaring past $90, a significant boost for WWE, TKO holdings, and the company's overall market value. For AEW, this is also a sigh of relief. Previously, AEW aired on Warner Bros. Discovery (WBD) channels like TNT, TBS, and AEW’s own channels. The deal may reduce the pressure on AEW to find a new home, but it does not eliminate it entirely.
Past Negotiations and Future Uncertainty
The months-long negotiations with Netflix put AEW in a difficult position. Despite WWE's interest, rumors suggested that WBD and Warner Bros. Discovery were also making a strong push for a WWE deal. This prolonged uncertainty created a stressful environment for AEW, given its current broadcasting agreements.
WWE’s deal with Netflix is not a foregone conclusion that AEW will re-negotiate with WBD. Following the high-profile merger between WBD and ATT in 2022, Warner Bros. Discovery has been making significant cost-cutting measures. Given these financial constraints, it's uncertain if WBD would be willing to maintain its current broadcasting deals with AEW, especially considering the company may prefer to drop its NBA broadcast rights. In December, longtime NBA broadcaster Ernie Johnson reaffirmed his belief that WBD would retain its NBA broadcasting rights, suggesting AEW may face challenges in maintaining its current broadcasting arrangements.
AEW's Future: Stressful Yet Less Intense
Achieving a new deal with WBD remains challenging for AEW, but the current environment is less stressful. WWE's signing with Netflix may have taken some of the pressure off WBD to make significant changes, potentially making a deal with AEW more feasible. However, the possibility of WBD losing its NBA broadcast rights remains a wildcard, which could impact future negotiations.
Long-Term Implications of the Netflix Deal
Netflix's pursuit of live sports programming, most recently through WWE, highlights a significant trend in the media landscape. As Netflix focuses on growing its subscriber base, the WWE-to-Netflix deal will serve as an intriguing case study on how live sports programming can drive subscription growth. Furthermore, Netflix's opt-out clause after the first five years creates an interesting dynamic, allowing for flexibility in the future.
Key Takeaways
The WWE and Netflix deal brings both opportunities and challenges for AEW. While WWE's enhanced visibility and brand strength are likely to overshadow AEW in terms of international reach, the deal may provide relief for AEW in terms of broadcasting stability. As the live sports market continues to evolve, the outcomes for both WWE and AEW will be closely watched by industry observers.
Conclusion
The WWE and Netflix deal is a pivotal moment for the wrestling industry. While it signals a new chapter for WWE, the outcome for AEW remains uncertain. The road ahead for AEW will be challenging but less stressful as it navigates potential broadcasting partnerships. The long-term implications of this deal will shape the future of professional wrestling and streaming media platforms.