WWE Tryout in India: An attempt to up the media rights acquisition price?

Last summer, the World Wrestling Entertainment's (WWE) top brass, including Stephanie McMahon, chief brand officer of WWE, Paul "Triple H" Levesque, executive vice president of Talent, Live Events and Creative for WWE met Rupert Murdoch and other senior officials at FOX Network to negotiate a new broadcast deal for its flagship product - WWE Smackdown Live. The meeting took place only a few hours after the exclusive negotiating window with NBCU concluded. At the end of the meeting, FOX announced that it has agreed to pay $250 million annually to acquire the rights of Smackdown for a period of five years making it a $1.025 billion broadcast deal. NBCU retained the rights for Monday Night RAW, the other flagship property of WWE for $265 million annually (as per The Hollywood Reporter). NBCU was earlier paying $150 million annually for both products. The head-on clash between the two media conglomerates resulted in the significant rise in the acquisition cost which, for both the products put together, happens to be $2.35 billion.

Many WWE's top brass are currently in India; are they having similar meetings with broadcast partners, negotiating the rights as the five-year-broadcast deal ends in 2019? We have no confirmation either way. What we do know is the contact sports giant just hosted its biggest ever Tryout in India. "Mind you, this is not the biggest ever Tryout in India, it is the biggest ever Tryout in the history of WWE," says John Brody, executive vice president global sales and head of international, WWE.

Set up in a large arena in Mumbai, the Tryout was to scout for new talent who could become future WWE superstars.

Two rings had 80 selected aspirants going through various drills which would decide who gets picked and who would need to try again. Sixty males and 20 females from the thousands of applicants were selected for the final Tryout in the business capital of India after a recruitment procedure which went on for six months. From the 80, a few will fly to the WWE Performance Centre in Orlando, Florida for further training and development. Brody is buoyed by the huge participation, saying "They have come here to fulfil their dreams and what excites us the most is, they did not just come from Mumbai or Delhi, but from all corners of India."

UK, Saudi Arabia and India are important international markets for WWE. About India, Brody says, "We have 386 million unique viewers in India annually. The Hindi telecast on Sony Max gets 26 million viewers every week. India is the number one market with monthly active Facebook users being higher than any other country in the world. India is also our number one market in our annual YouTube viewership."

Media rights remain the biggest source of revenue for WWE in India. In fact, experts suggest it is the only source of revenue as merchandising and live events are yet to take off here. "We have launched our CPG (Consumer Packaged Goods) website www.wweshop.in where we are creating different products for India than we are for the US. It's customised for India and for Indian consumers, localising your opportunity base," Brody says, adding, "We see tremendous technology growth happening in India, we see an opportunity for more and more consumers to get closer to WWE through Sony, through the changing landscape of telecom."

Rajesh Kaul, chief revenue officer, distribution and head - Sports Business, Sony Pictures Networks India is also upbeat about the property stating, "WWE is the second most viewed property on ports networks after Cricket and enjoys a huge following. It possesses the right mix of action and drama that attracts viewers across demographics."

He adds, "In the last few years, we have seen steady growth for contact sports and wrestling in Hindi Speaking markets like UP, Gujarat, Delhi etc. We further strengthened our commitment of making international sports accessible to a larger set of audiences by launching Hindi commentary for WWE matches in 2018. Along with RAW and Smackdown, Hindi commentary was also made available for the Live pay-per-view events. This initiative has led to considerable growth in ratings, with 172 million viewers sampling the Hindi feed for WWE on Sony TEN 3."

The broadcast rights of WWE Smackdown and RAW was retained by Zee Entertainment Enterprises Limited's (ZEEL) sports network, Ten Sports. Sony Pictures Networks India acquired Ten Sports from Subhash Chandra's ZEE in 2016 for $385 million (Rs 2600 crore) with which Sony got all of Ten Sports' content, including WWE. In 2014, Ten Sports had reportedly renewed the media rights for $140 million for five years. As a clause of the deal, Sony (then Ten Sports) will get the first right to refusal and, if sources are to be believed, WWE has a price tag of around $250 - $280 million. Experts believe that the recent Tryout and on-ground activities like flying WWE legends to India etc. are attempts to up the price.

"Double of what it was is astronomical in the current scenario," says a media analyst. "Back then, it was a three-way race between Star, Zee and Sony; now it is a duopoly unless Discovery's D-Sports joins the race. Also, in 2014, India did not have much sports content. Now, viewers have the Pro Kabaddi League, Indian Super League, Pro Wrestling League and the Volleyball League so neither Star nor Sony will be dependent on WWE," he says, adding, "However, as we saw in the case of the Spanish Football League (La Liga), Facebook can fight for the rights or a Jio might contest, which can make it interesting."

Monetising WWE broadcasts also has its challenges, believes a media planner. On condition of anonymity he says, "WWE is violence and hence, it is risky to associate with. FMCG likes to keep itself away from it; electronic appliances also hesitate. Deodorants, condoms, food supplements, energy drinks are the kind of advertisers normally associated with WWE."

It remains to be seen if WWE manages to pocket a significant amount for its media rights in India. Will WWE sell television and digital rights separately, will it segregate RAW and Smackdown as two separate properties as it did in the US? It's just a matter of time before all is unveiled.

For feedback/comments, please write to newsteam@afaqs.com