Summary of "Why Netflix Spent Billions for WWE" The Indicator from Planet Money | NPR | Released on January 7, 2025

Introduction to Pro Wrestling and Its Mainstream Appeal

The episode begins with hosts Adrian Ma and Darian Woods exploring the world of professional wrestling. Darian describes pro wrestling to novices as “scripted acrobatics that mostly has an audience of teenage boys, a lot of teenage girls, and a lot of adult men and women too” (00:26). They introduce Kazim Famuyide, co-host of the "Masked Man Show" podcast, who likens pro wrestling to “a violent soap opera” (00:42). Kazim emphasizes that wrestling blends combat sports with entertainment, compelling storylines, and charismatic personalities, making it a staple in pop culture (00:52).

Kazim also touches on the shifting perception of pro wrestling, noting that it’s becoming more widely accepted and no longer viewed as a niche interest. He states, “It’s very much entrenched in pop culture everywhere and it doesn't seem like a weird thing to like anymore. It just sort of feels like one of the other major sports” (01:18).

The Rise of Streaming and Netflix’s Strategic Investments

Darian introduces the central topic: World Wrestling Entertainment (WWE) making a significant move by debuting its flagship program, "Monday Night Raw," on Netflix. This marks a $5 billion deal securing exclusive streaming rights for the next decade (03:08). This partnership is a cornerstone in Netflix's broader strategy to capture live sports content, positioning itself against traditional cable and broadcast networks.

Adrian poses a critical question: “What does Netflix's investment in live sports programming say about the war for viewers’ eyeballs and does it signal the end of cable TV?” (01:51).

Details of the WWE and Netflix Partnership

"Monday Night Raw" has been a long-running cable TV program featuring high-energy performances and live sports entertainment. The recent shift to Netflix signifies a major transition, with promotional efforts branding it as “Raw on Netflix” (03:08). This move is part of Netflix’s broader acquisition of live sports rights, including National Football League (NFL) games and the Women’s World Cup, aiming to diversify its content beyond traditional movies and TV series.

Expert Insights: Paolo Pescatori on Streaming Strategy and Challenges

Adrian interviews Paolo Pescatori from PPForesight, who provides a deep dive into Netflix’s motivations and the challenges it faces. Paolo explains that “for Netflix, they need to diversify. They can't just solely rely on one genre, say, or just on-demand programming” (04:49). This diversification is essential to maintain Netflix's competitive edge in a saturated streaming market, where rivals like Amazon, Apple, Hulu, and niche players are constantly vying for subscribers.

Paolo further discusses the technical hurdles of streaming live sports, highlighting the necessity of “a robust and reliable infrastructure to deliver those streams at scale to millions of users worldwide” (05:26). He points out that while acquiring rights is a significant step, ensuring seamless streaming quality is equally crucial for viewer retention.

Viewer Reception and Technical Hurdles

The episode recounts a recent instance where Netflix streamed a high-profile boxing match between Jake Paul and Mike Tyson. Despite attracting tens of millions of viewers, the event was marred by technical issues, such as buffering and low-quality streams. A frustrated viewer expressed their disappointment on TikTok, questioning Netflix’s capability to handle live sports:

"What's wrong with Netflix's stream? First off, this looks like it's running in 360p. What? The audio's low, the crowd sounds loud. What's going on, Netflix? Have you not had any run at this at all?" (06:01).

Despite these setbacks, Netflix's foray into live sports isn't all negative. The platform achieved notable success by streaming two NFL games on Christmas Day, each drawing approximately 14 million viewers and becoming the most-watched English language programs on Netflix that week (06:31).

Cord Cutting and the Shift from Cable to Streaming

Darian discusses the broader trend of "cord cutting," where consumers are abandoning traditional cable subscriptions in favor of streaming services. Citing IBISWorld data, he notes that U.S. cable subscriptions have plummeted from over 100 million a decade ago to just 66 million today (03:08).

This trend underpins why sports leagues are keen to partner with streaming platforms. Paolo explains that leagues aim to “broaden their customer base beyond the core following” and to better connect with viewers who are moving away from cable (06:43). Streaming platforms like Netflix offer a way to reach international audiences and adapt to changing viewer behaviors.

The Future of Sports Broadcasting: Predictions and Implications

Looking ahead, Paolo predicts that the competition between streaming services and traditional cable will intensify, potentially leading to new business models or mergers within the industry (07:13). He envisions a future where major global sporting events could be exclusively available online, although he suggests that iconic events like the Super Bowl might remain with traditional broadcasters for now (07:40). However, he anticipates that by the 2030s, significant global events could transition to internet-only platforms.

Adrian adds a perspective on the swiftness of this transition, suggesting it could happen sooner than expected, potentially with a diverse range of events, including niche competitions like the Westminster Dog Show (08:00).

Kazim Famuyide offers a counterpoint, emphasizing the passionate and loyal fanbase of pro wrestling: “I’d say pro wrestling fans are some of the most die-hard loyal fans I've seen in any form of entertainment. If you build it they will come” (08:17).

Conclusion: The Ongoing Battle for Viewer Engagement

The episode concludes by highlighting the ongoing struggle for viewer engagement between streaming giants and traditional cable networks. Darian and Adrian discuss the potential shifts in content distribution, emphasizing that the survivors in this competitive landscape will be those who innovate and offer compelling online content.

Darian teases future possibilities, asking listeners what big sports competitions they’d like to see on Netflix. Adrian humorously suggests “Competitive Game Theory,” aligning with Netflix’s brand of unique and engaging content (08:28).

Production Credits

The episode was produced by Corey Bridges, engineered by Jimmy Keighley, fact-checked by Ciara Juarez, and edited by Cake and Cannon for NPR's The Indicator.

Notable Quotes:

• Kazim Famuyide: “It’s very much entrenched in pop culture everywhere and it doesn't seem like a weird thing to like anymore. It just sort of feels like one of the other major sports.” (01:18)

• Paolo Pescatori: “For Netflix, they need to diversify. They can't just solely rely on one genre, say, or just on-demand programming.” (04:49)

• Aggrieved TikToker: “What's wrong with Netflix's stream? First off, this looks like it's running in 360p. What? The audio's low, the crowd sounds loud. What's going on, Netflix?” (06:01)

• Kazim Famuyide: “I’d say pro wrestling fans are some of the most die-hard loyal fans I've seen in any form of entertainment. If you build it they will come.” (08:17)

This episode of The Indicator from Planet Money provides a comprehensive look into Netflix’s strategic investment in live sports, particularly WWE, against the backdrop of the broader shift from traditional cable to streaming platforms. Through expert insights and engaging discussions, it sheds light on the complexities and future trajectory of sports broadcasting in the digital age.