WWE's Raw is moving to Netflix in a $5 billion deal

Netflix has reached a multi-billion-dollar, 10-year deal to acquire the exclusive rights to WWE's flagship weekly wrestling show, “Raw,” as the streaming giant expands its offerings with more live content.

Netflix and TKO Group, the parent company of WWE, said the deal will bring “Raw” to Netflix starting next January. In the current situation Tuesday. Netflix will also have the rights to stream other WWE shows and specials outside the United States.

TKO Group said the agreement will cost Netflix more than $5 billion and will last for 10 years, with the option to extend for an additional 10 years or opt out after five years. Regulatory filing.

“By combining our reach, recommendations and fanbase with WWE, we will be able to deliver even more entertainment and value to their fans and our members,” Bela Bajaria, chief content officer at Netflix, said in a statement.

With the WWE deal, Netflix is ​​significantly expanding its range of live programming, which also includes the reality show “Love Is Blind.” Streaming live shows can be a particular challenge for Netflix, which experienced technical difficulties during its “Love Is Blind” reunion episode last April. However, Chris Rock's live comedy went smoothly a month ago.

The company has recently focused on sports documentaries on live sporting events. But adding “Raw” to its lineup makes Netflix more competitive with rivals like Peacock, which has made live sporting events the backbone of its service and recently broadcast an NFL playoff game. Amazon Prime has been streaming Thursday night NFL games since 2022; Apple has signed a $250 million-per-year deal with Major League Soccer and an additional agreement with Major League Baseball.

Netflix's move comes just months after Ted Sarandos, the company's co-CEO, told analysts during a third-quarter earnings call that behind-the-scenes documentaries and shows like “Drive To Survive,” “Full Swing” and “Quarterback.” It was “the part of the sports business that we bring the most value to, which is sports drama.”

He added about live sports: “We are not anti-sports. We are only pro-profit. We haven't figured out how to do that yet.”

A deal with WWE, a sports-adjacent organization that features largely live and scripted content, could be a step toward finding out.

“The WWE-Netflix partnership is a big deal,” Forrester analyst Mike Proulx said, noting that the company's flip-flopping into live sports resembles a change in its strategy regarding advertising. For years, company executives pledged that the service would never include ads. However, starting last year, Netflix began offering an ad-supported subscription for a lower monthly price.

“Make no mistake, Netflix's shift into live sports is all about advertising, with the company doubling down on its efforts to attract major brands, rather than spending its TV budgets on Netflix's growing addressable audience,” he said.

As the U.S. streaming business matures, more deals of this kind are likely, said KPMG analyst Scott Purdy.

“Media rights are very attractive to streaming companies because you have a guaranteed audience that wants to watch the big game, match or event,” he said. “This will undoubtedly impact the amount of content budget allocated to live sports versus other content options.”

“Raw,” which launched the careers of stars like Stone Cold Steve Austin, John Cena and Dwayne (The Rock) Johnson, has appeared on linear television since its debut in 1993. It now airs on USA Network, drawing 17.5 million view. Unique viewers per year, according to WWE

TKO, which is controlled by Hollywood powerbroker Arie Emanuel Endeavor and was created by the merger of WWE and Ultimate Fighting Championship last year, said in Separate statement Mr. Johnson will join its Board of Directors. TKO shares jumped about 17 percent on Tuesday. Netflix shares rose slightly.

WWE's announcement came a day after Netflix announced that Scott Stuber, the company's films president, who has lured filmmakers like Rian Johnson, Zack Snyder and Greta Gerwig to the streaming service, will leave in March. Its film team received 18 Oscar nominations on Tuesday, ranking second among film studios after Disney.