I really believe the wwe network model will be the future model for how we pay for tv.

I don't see that. I mean they only went that way because they could not get anyone to buy their more traditional model. Should also tell you about the cost of Ala Carte. They were trying to sell this to cable companies for less than $.50 per subscriber and could find no takers. Now it is $9.95 ala carte. That is 20 x's (minimum) the wholesale price they aimed for.

That does not bode well for the future of ala carte TV.

Wwe is an interesting case. Cable providers were not only going to lose ppv revenue by a traditional cable wwe network but were also going to to have to pay the wwe a set fee per subscriber for the new channel. No wonder they weren't interested in that deal because its bad business for them. And a cable wwe network without the ppvs is dead on arrival in terms of customer demand, see wwe classics on demand.

Whether they are doing this boldly or out of desperation doesnt really matter rhat much right now. They are taking advantage of the Internet as the new medium of distribution. If they make it work, which I think they will, they will be joined by other content providers sooner rather than later.

To tie back into the topic. Wwe is showing the benefits of going around cable companies. While not free its certainly a better deal for wrestling fans than the current cable plus ppv model

(02-19-2014 03:12 PM)solohawks Wrote:  Whether they are doing this boldly or out of desperation doesnt really matter rhat much right now. They are taking advantage of the Internet as the new medium of distribution. If they make it work, which I think they will, they will be joined by other content providers sooner rather than later.

They are also making far less money than they would have the traditional way, and the customer is paying a lot more (albeit only the customers who want it are paying for it). As I was saying, it shows how much it will cost if others "go around" cable. it costs the consumer a lot more, not less, and they get less.

Wrestling fans are saving money. For ten dollars a month you get something that used to cost 60 a month plus other original programming and archival content thrown in for free. So I disagree with you there on the consumer losing out on this particular venture.

As for the wwe losing money I read they were offered around .20 a month per subscriber for a cable network, im assuming that included ppvs on the network. So they would need 50 million subscribers that way for every 1 million subscribers the internet way. Much more growth potential this way so I also disagree wirh you on the company losing money.

Consumers are paying less with the middle man being cut out.

(02-19-2014 03:47 PM)solohawks Wrote:  Wrestling fans are saving money. For ten dollars a month you get something that used to cost 60 a month plus other original programming and archival content thrown in for free. So I disagree with you there on the consumer losing out on this particular venture.

They are only saving money if they ordered every PPV. Considering they average about 200k buys per event (outside of WM), and 8 million viewers per week (among all shows), only a small percentage of their target audience would be "saving" money. What WWE is doing here is using their PPV's to attract people who otherwise don't buy their PPV's, think they are getting a good deal and paying for it every month. There is certainly value there, but the majority are spending a LOT more than they were. Hence why they think they will make more by starting a network.

(02-19-2014 03:47 PM)solohawks Wrote:  As for the wwe losing money I read they were offered around .20 a month per subscriber for a cable network, im assuming that included ppvs on the network. So they would need 50 million subscribers that way for every 1 million subscribers the internet way.

The $0.20 per subscriber was never offered. It was $0.50 - $0.75 per subscriber (after $1.00 was laughed out) that was reduced to about $0.30. It did not include all PPV's, but some (I think all but WM and RR, and maybe SS). But further, there are a lot more costs with the over the top model (they are paying MLB to do it for them) that were not there with cable. And when you are in the homes of

(02-19-2014 03:47 PM)solohawks Wrote:  Much more growth potential this way so I also disagree wirh you on the company losing money.

Quite the opposite. There is much more brand growth available when your channel is available in 50 million homes on cable and satellite, then when available to 1-2 million homes on the internet, which is a utilized technology, but not near as widespread. The ideal option, which was what they wanted, was a cable set up with an online component (think TNT.com or ESPN3). Considering WWE tried for 2.5 years to get this on cable before going the over the top method, even they know this was not ideal. Now being one of the first to do something has some advantages, but there is not more "growth potential" then if they were next to the Syfy Channel on the dial.

(02-19-2014 03:47 PM)solohawks Wrote:  Consumers are paying less with the middle man being cut out.

If by paying less you mean paying 20 - 50x more, then I guess. They are not paying less (if they were paying less, WWE would not be expecting such an increase in revenue). **Some** people will pay less for sure. But not the majority of their fans. And there is still a middle man. In this case MLB technologies as opposed to Time Warner or Comcast. But there is always a middle man.

Time.com article said $.20 a month was what Vince turned down.

Wrestlemania was $70 last year which equals 7 months of wwe network. If you buy at least 2 ppvs you have saved money. Plus you factor in people like myself who think its absolutely crazy to spend 60 dollars for 3 hours of entertainment but will spend 10 dollars on a full network

They no longer will have cable networks taking half their ppv revenue although youee right they have to pay mlb to help operate it. No clue which is cheaper but id rather pay fo a service than hefty ppv distribution fees.

I think it will be easier to sell the consumer on spending 9.99 on unlimited wrestling then it would be to convince them to subscribe to a sports or premium tier that costs at least 9.99

I like the WWE model. That's 30 cents not on my cable bill :)

(02-19-2014 04:24 PM)solohawks Wrote:  Time.com article said $.20 a month was what Vince turned down.

As I said, WWE never offered $0.20.

(02-19-2014 04:24 PM)solohawks Wrote:  Wrestlemania was $70 last year which equals 7 months of wwe network.

That was not the average cost. That was the HD cost of a few providers. The typical cost was $59.99. But, WWE only gets 40% of that - the cable companies get 40% and the middle man (on demand I think) get 20%. Hence you can see why cable companies were not all that happy to help WWE here. They are losing a TON of money on this deal.

(02-19-2014 04:24 PM)solohawks Wrote:  If you buy at least 2 ppvs you have saved money. Plus you factor in people like myself who think its absolutely crazy to spend 60 dollars for 3 hours of entertainment but will spend 10 dollars on a full network

Exactly what I am talking about. If you are going from $0.00 per month to WWE to $9.95, you are not "saving money." You may feel you are getting a good value, but you are now paying for something you previously did not deem worthy to purchase. You are now paying MORE, not less.

(02-19-2014 04:24 PM)solohawks Wrote:  I think it will be easier to sell the consumer on spending 9.99 on unlimited wrestling then it would be to convince them to subscribe to a sports or premium tier that costs at least 9.99

Again, you are right. But only the handful that previously bought every event are saving money (I think the number is estimated that about 300,000 households buy 4 or more per year). Actually only the people who bought more than three events are saving any significant money (if you bought three, you save about $15 per year). Everyone else is breaking even money wise, or paying more than they did before. Again, might be a better value, but not a money saver for most. And thus WWE is using it to get people to spend more money. It might be better for all involved, but there is not a money savings for the majority of people they think will subscribe.

Note there is nothing wrong with getting what you pay for. so I am not saying it is a bad deal. I am saying few will actually save money.

True. Only those who bought more than 1 ppv a year will be saving money. I was factoring in those who wanted the content but were priced out of it due to the high cost. They won't technically be saving money but will be able to purchase content that was once out of their price range.

I still think this model has more growth potential than a cable network that would have likely been on a sports tier.

(02-19-2014 04:35 PM)adcorbett Wrote:  

(02-19-2014 04:24 PM)solohawks Wrote:  Time.com article said $.20 a month was what Vince turned down.

As I said, WWE never offered $0.20.

(02-19-2014 04:24 PM)solohawks Wrote:  Wrestlemania was $70 last year which equals 7 months of wwe network.

That was not the average cost. That was the HD cost of a few providers. The typical cost was $59.99. But, WWE only gets 40% of that - the cable companies get 40% and the middle man (on demand I think) get 20%. Hence you can see why cable companies were not all that happy to help WWE here. They are losing a TON of money on this deal.

(02-19-2014 04:24 PM)solohawks Wrote:  If you buy at least 2 ppvs you have saved money. Plus you factor in people like myself who think its absolutely crazy to spend 60 dollars for 3 hours of entertainment but will spend 10 dollars on a full network

Exactly what I am talking about. If you are going from $0.00 per month to WWE to $9.95, you are not "saving money." You may feel you are getting a good value, but you are now paying for something you previously did not deem worthy to purchase. You are now paying MORE, not less.

(02-19-2014 04:24 PM)solohawks Wrote:  I think it will be easier to sell the consumer on spending 9.99 on unlimited wrestling then it would be to convince them to subscribe to a sports or premium tier that costs at least 9.99

Again, you are right. But only the handful that previously bought every event are saving money (I think the number is estimated that about 300,000 households buy 4 or more per year). Actually only the people who bought more than three events are saving any significant money (if you bought three, you save about $15 per year). Everyone else is breaking even money wise, or paying more than they did before. Again, might be a better value, but not a money saver for most. And thus WWE is using it to get people to spend more money. It might be better for all involved, but there is not a money savings for the majority of people they think will subscribe.

Note there is nothing wrong with getting what you pay for. so I am not saying it is a bad deal. I am saying few will actually save money.

Better for me and those of us that don't watch WWE. It would've been another 20-50 cents tacked on unto our cable bill.
I think that the a la carte debate is completely irrelevant. Its coming whether some of you like it or not. To me the question is: how much are you guys willing to pay for ESPN? or Fox or any of the other sports networks.

(02-19-2014 04:35 PM)adcorbett Wrote:  

(02-19-2014 04:24 PM)solohawks Wrote:  Time.com article said $.20 a month was what Vince turned down.

As I said, WWE never offered $0.20.

(02-19-2014 04:24 PM)solohawks Wrote:  Wrestlemania was $70 last year which equals 7 months of wwe network.

That was not the average cost. That was the HD cost of a few providers. The typical cost was $59.99. But, WWE only gets 40% of that - the cable companies get 40% and the middle man (on demand I think) get 20%. Hence you can see why cable companies were not all that happy to help WWE here. They are losing a TON of money on this deal.

(02-19-2014 04:24 PM)solohawks Wrote:  If you buy at least 2 ppvs you have saved money. Plus you factor in people like myself who think its absolutely crazy to spend 60 dollars for 3 hours of entertainment but will spend 10 dollars on a full network

Exactly what I am talking about. If you are going from $0.00 per month to WWE to $9.95, you are not "saving money." You may feel you are getting a good value, but you are now paying for something you previously did not deem worthy to purchase. You are now paying MORE, not less.

(02-19-2014 04:24 PM)solohawks Wrote:  I think it will be easier to sell the consumer on spending 9.99 on unlimited wrestling then it would be to convince them to subscribe to a sports or premium tier that costs at least 9.99

Again, you are right. But only the handful that previously bought every event are saving money (I think the number is estimated that about 300,000 households buy 4 or more per year). Actually only the people who bought more than three events are saving any significant money (if you bought three, you save about $15 per year). Everyone else is breaking even money wise, or paying more than they did before. Again, might be a better value, but not a money saver for most. And thus WWE is using it to get people to spend more money. It might be better for all involved, but there is not a money savings for the majority of people they think will subscribe.

Note there is nothing wrong with getting what you pay for. so I am not saying it is a bad deal. I am saying few will actually save money.

As a person who runs a subscriber oriented website, and who has a touch of newspaper experience, let me add that the best customer you can have is not the one who buys a newspaper from the box, nor the person who buys a six or 12 month subscription.

It's the person who buys a monthly subscription that renews automatically.

The person who buys from the box (the PPV buyer) you are in constant customer acquisition mode. Your cost per transaction is terrible. One need only look at how much marketing is done for PPV events to know that while the dollars per transaction are pretty nice, the cost of acquiring a sale is pretty significant.

I don't like six month and 12 month customers that well either because they get that heads up that their subscription is going to renew and it is a large enough number (though cheap by the standards of competitors) that they take a minute to think about it and might cancel for no reason other than to avoid the charge hitting while they are at a cash poor part of the month and I've got to hope to get them back.

The monthly folks, that small transaction clicks off like clockwork and even if they are thinking about cancelling the effort to cancel to many is as great or greater than the cost of the subscription. Heck I've held on to some subscriptions myself because the few dollars weren't worth the hassle and figured I might start using the subscription again soon.

That factor cannot be overlooked for them. The person who never bought a PPV or infrequently bought one looks at less than $10 month as a good deal and even if they are heavy users, retaining them is far easier and much cheaper than hauling them back in to buy another PPV.

(02-19-2014 05:46 PM)arkstfan Wrote:  That factor cannot be overlooked for them. The person who never bought a PPV or infrequently bought one looks at less than $10 month as a good deal and even if they are heavy users, retaining them is far easier and much cheaper than hauling them back in to buy another PPV.

For the record, I don't disagree with that. That is why they are starting this our with WrestleMania coming up and hoping to get a bunch of people to sign up because it is such a great deal (you have to sign up for six months) then from there you keep going. They should do well. However from the company standpoint, it is not a better option that having your network "free" to 50 million people with extended basic cable. Then you get to make subscriber fee revenue plus ad revenue, and attract channel flippers.

I was also stating that the customers they are targeting will actually be spending more money, not less, for their product than they were paying before (the majority, but not all). Even if they may be more satisfied with that they are getting, they are spending more dollars. And they will be paying infinitely more ala carte ($9.95 per month) than they would have under the cable model ($0.30 - $0.40 per month), which is what opponents of ala carte have been saying will happen and no one believes them. So if ESPN is $5.24 per month wholesale, what do you think it will be ala carte? I think $35 - 40.00 per month is the minimum.

(02-19-2014 06:00 PM)adcorbett Wrote:  

(02-19-2014 05:46 PM)arkstfan Wrote:  That factor cannot be overlooked for them. The person who never bought a PPV or infrequently bought one looks at less than $10 month as a good deal and even if they are heavy users, retaining them is far easier and much cheaper than hauling them back in to buy another PPV.

For the record, I don't disagree with that. That is why they are starting this our with WrestleMania coming up and hoping to get a bunch of people to sign up because it is such a great deal (you have to sign up for six months) then from there you keep going. They should do well. However from the company standpoint, it is not a better option that having your network "free" to 50 million people with extended basic cable. Then you get to make subscriber fee revenue plus ad revenue, and attract channel flippers.

I was also stating that the customers they are targeting will actually be spending more money, not less, for their product than they were paying before (the majority, but not all). Even if they may be more satisfied with that they are getting, they are spending more dollars. And they will be paying infinitely more ala carte ($9.95 per month) than they would have under the cable model ($0.30 - $0.40 per month), which is what opponents of ala carte have been saying will happen and no one believes them. So if ESPN is $5.24 per month wholesale, what do you think it will be ala carte? I think $35 - 40.00 per month is the minimum.

No I'd take 50 million paying 30 cents each and every day of the week. $15 million per month with no cost of acquisition, no billing apparatus, no subscriber database to maintain, no risk of getting hacked and losing the subscriber's credit card data and the attendant PR mess.

But I like the model they have over the PPV model.