World Wrestling Entertainment leveraged its streaming service into a better deal with a Canadian cable provider.
Islands in the streaming:
With HBO and then CBS announcing online streaming subscription services, it’s the end of cable TV as we know it, right?
There was no shortage of exuberant takes, mine included, suggesting as much after HBO made its landmark announcement last week. The momentum only built as CBS followed suit a day later.
But with the benefit of sober second thought, it’s not outlandish to also think that the networks’ moves could actually make things worse for consumers. No one besides their executives know what the real end games are here.
A good example of what could go wrong comes from the WWE Network.
The “Netflix of pro wrestling” launched in the United States in February. For rasslin’ fans, it promised a great deal. For $9.99 and a six-month commitment, they got access to a big catalog of older content, plus live monthly pay-per-views. Those events cost about $45 each regularly, so it was an instant payoff.
But World Wrestling Entertainment revealed a different plan with the expansion of its online network into Canada this summer. Rather than offering fans the same appealing deal, the company instead inked a decade-long agreement with Rogers that makes the cable provider its exclusive distributor in Canada for the foreseeable future.
As many fans have complained, the Canadian version of the WWE Network is a shade of its American self. It’s more expensive at $11.99, and has less content. Most importantly, it’s not a proper online streaming service, but rather a pay TV channel available only to Rogers television subscribers.
Rogers is looking to sub-license the “Network” to other TV providers, who will also likely offer it as a pay channel.
It’s possible WWE was forced to change its approach to online streaming because of the Network’s underperformance in the United States. But that’s unlikely given how little time the service has been given to deliver.
Rather, it looks like a calculated gambit to acquire better deals from TV providers, like the exceptionally long 10-year agreement from Rogers.
HBO and CBS may legitimately think they can do better for themselves with online services that go directly to consumers, but there’s an equal chance network executives are thinking along those same lines. Their online streaming services could be negotiating ploys to get better terms from cable providers.
If that’s the case and the gambits do pay off, like WWE’s did, consumers could be stuck with hamstrung services that never really live up to the hype they first invited.