In a recent fourth-quarter earnings conference call, Netflix co-Chief Executive Officer, Ted Sarandos, reiterated the company’s stance on its newly acquired deal to license WWE’s Raw for the next decade. Sarandos emphasized that professional wrestling falls under the category of “sports entertainment” rather than actual sports. He stated, “WWE is sports entertainment. It’s really as close to our core as you can get in terms of sports storytelling.” This distinction is crucial as it clarifies Netflix’s approach to sports-related content and underscores the company’s commitment to its current sports strategy.
The announcement of the WWE Raw deal led to speculation about whether Netflix would pursue streaming rights for major sports leagues. Sarandos swiftly dismissed these speculations and emphasized that the WWE deal does not signal a shift in the company’s sports strategy. While Netflix has held preliminary discussions with the National Basketball Association (NBA) for possible streaming partnerships, Sarandos suggested that Netflix is unlikely to play a significant role in those negotiations or any traditional live sports rights discussions. The NBA intends to limit itself to three media partners, reducing the potential for Netflix to engage in meaningful negotiations.
Although traditional live sports may not be part of Netflix’s immediate plans, the streaming giant has delved into “sports-adjacent” programming. They have successfully produced documentary series centered around Formula 1 and professional disciplines such as tennis, golf, cycling, and football. By developing content related to these sports, Netflix taps into fans’ passion for the behind-the-scenes stories and narratives that surround the events themselves. This strategy has proven successful, as demonstrated by the substantial investment of over $5 billion for a decade’s worth of WWE’s Raw and other international programming.
Sarandos drew a comparison between the WWE Raw deal and Netflix’s successful venture into Formula 1 programming. While Formula 1 enjoys significant international popularity, WWE primarily caters to a US audience with a relatively small international following. Taking inspiration from their success with Formula 1, Netflix plans to “build” WWE’s popularity through additional shoulder programming. By crafting compelling narratives around WWE events, Netflix aims to expand the international viewership base for this sports entertainment franchise. Sarandos referred to this as a proven formula for the streaming service.
Although Netflix’s stance seems resolute at present, the company has garnered a reputation for changing its approach to key business issues. For instance, Netflix once refrained from advertising and took a lenient stance on password sharing but eventually reversed course in recent years. Given this adaptability, the move to obtain a massive rights deal with WWE’s Raw marks a notable shift for Netflix. This evolution could potentially pave the way for the streaming giant to explore traditional sports in the future, despite Sarandos’s current statements. As Netflix continues to push boundaries and expand its content offerings, traditional sports may become an inevitable part of their strategy.
Netflix’s acquisition of WWE’s Raw signals a continuation of their sports entertainment strategy rather than a foray into traditional live sports. The distinction between sports and sports entertainment is crucial, as it sets the framework for Netflix’s content development and audience engagement. While traditional live sports may not be on Netflix’s immediate agenda, their success with “sports-adjacent” programming showcases their ability to tell captivating stories and fuel viewers’ passion for sports narratives. As Netflix’s approach continues to evolve, it remains to be seen whether they will eventually enter the realm of traditional sports, as they have proven their adaptability and willingness to explore new avenues.
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