World Wrestling Entertainment may have slightly missed revenue targets — and overperformed on cash flow — in the third quarter, but executives spent the majority of a conference call with analysts talking about the potential for big gains in its renewal talks for its flagship shows — Monday Night Raw and SmackDown — which are expected to commence early next year.

WWE reported Q3 revenue of $256 million, about 1% below analysts consensus estimates of $259 million, but beat and raised estimates for cash flow in the period. WWE said adjusted OIBDA for the period was $78 million, 15% above consensus estimates of $68 million and driven by strong live event revenue of $28 million. As a result, WWE increased its full-year AOIBDA estimate to between $305 million and $315 million from the previous mark of $270 million to $300 million.

On a conference call with analysts to discuss results, WWE president and chief revenue officer Nick Khan said rights for Raw will come up for renewal with Hulu during the back half of 2022, while international licensing for its direct-to-consumer offering WWE Network expire at around the same time.

Khan seemed especially encouraged by the Hulu talks, adding that Raw “has a substantial and recurring audience who watch the show via delayed viewing week to week” on the streaming service. He noted that the last time WWE and Hulu negotiated those rights — in 2018 — the streaming landscape was considerably different than today.

Regarding international licensing, Khan said that WWE has a strategy to optimize WWE Network’s value outside the U.S., and a model that programming buyers are responding to.

“As so many U.S.-based companies look to go international overnight, it sets up a competitive global landscape that none of us have seen over the course of our careers,” Khan said on the call. “We continue to believe that will garner great results.”

But the bulk of the optimism was for Raw and SmackDown renewals in the U.S. Khan pointed out that during the last negotiation, WWE was able to more than triple its fees from $130 million for the shows to $470 million.

“We are as bullish now on those rights as we were when we went into the prior negotiations,” Khan said.

The CFO pointed to recent sports rights deals for the NFL, NHL, Major League Baseball, the SEC, La Liga and Wimbledon, and pointed out that other interested players like Amazon Prime Video, Apple TV and Netflix are sniffing around the sports market.

Amazon and Apple are reportedly in the lead among the possible bidders for NFL Sunday Ticket and Netflix chief operating officer Ted Sarandos has said publicly that he would rather own sports properties than run them.

In a research note, Wells Fargo Securities media analyst Steven Cahall said NBCUniversal’s Peacock streaming service is expected to be the bidder to beat for the WWE properties.

“We expect Peacock to go hard for the re-air rights given it already has Raw and NXT on linear + domestic streaming rights on Peacock, so it's really a question about whether media companies compete for the rights against NBCU,” Cahall wrote. “International is tougher to pin down as no comprehensive ex-US OTT rights have ever been struck to our knowledge, so a single deal for WWE Network [outside the continental U.S.] would be truly groundbreaking.

While streaming services such as Amazon Prime Video and ESPN Plus made the most noise from the just-inked National Football League and National Hockey League television rights deals, broadcast networks also scored valuable live content under the long-term pacts. 

The Big Four broadcasters — ABC, CBS, Fox and NBC, considered long
past their prime as major live-sports distributors — retained their status as the pre-eminent outlets for NFL regular season and playoff games, including the Super Bowl. And ABC leveraged its corporate Disney connection to ESPN to add Monday Night Football doubleheaders and a pair of Super Bowls, as well as four Stanley Cup Finals over its seven-year deal with the NHL. 

Amazon in Primetime

Amazon Prime Video garnered headlines when it snagged the Thursday Night Football package away from Fox starting in 2023 as part of the new 11-year NFL TV deal, which also ends the simulcasts on NFL Network. Fox and CBS will continue to offer the lion’s share of regular-season Sunday afternoon NFL games and NBC will keep TV’s most-watched series, Sunday Night Football. ABC will join the three networks in rotating the Super Bowl telecasts — typically the most-watched TV program of the year — through 2031.

CBS Sports chairman Sean McManus said that the broadcast network remains the key component of its NFL distribution strategy even as the network’s telecasts will also be simulcast on Paramount Plus. “The NFL will really be a driver of value and a driver of audience on our linear networks, on our digital networks and our streaming networks,” McManus said in a keynote speech at the NATPE Virtual Business of Live Sports TV conference March 23. 

Along with two Super Bowl telecasts, ABC also picks up three annual Monday Night Football telecasts as well as two late-season Saturday afternoon simulcast games with ESPN. ABC is a major component of ESPN’s overall NFL television strategy, NFL Media executive VP and chief operating officer Hans Schroeder said during ESPN’s March 18 conference call on the NFL deal. “When you think about … ABC coming back into the partnership for a number of exclusive games and also playoffs and Super Bowl, you think about the opportunities to leverage the different traditional channels and outlets ESPN and the Disney family have,” Schroeder said.

ABC also skated away with additional live sports content from Disney’s new TV deal with the NHL. ABC will have exclusive coverage of the Stanley Cup Finals for four years of the overall seven-year agreement. The broadcast network will also share 25 exclusive, national regular-season games with ESPN, as well as live exclusive coverage of one Conference Finals series and half of all first-round and second-
round games from the Stanley Cup Playoffs. 

The NHL, now in the final year of an exclusive U.S. arrangement with NBC Sports Group, is still seeking a second TV partner. 

ABC Back on the Grid

With broadcast networks and their affiliated stations looking for high-profile content to lead into its advertiser-attractive local news segments, sports analyst Lee Berke said ABC’s addition of the Super Bowl and Stanley Cup telecasts — as well as NFL Monday Night Football games and NHL regular and postseason games — will pay dividends for the broadcast network well into the decade. 

“ABC up to this point has been a laggard in offering sports to drive viewers to local news — all they really had was the NBA and college football — as the bulk of their sports programming moved over to ESPN,” he said. “Now, along with SEC college football, they will have the Stanley Cup finals every other year, Monday Night Football and placement in the Super Bowl rotation to go along with the NBA Finals. 

“When put in context, you’re now looking at 60 to 80 marquee sports events a year on ABC,” he said. “They have really bulked up.” 

Securing a new TV deal for the New York Cosmos soccer club isn’t the first priority for its new owner, Mediacom Communications founder, chairman and CEO Rocco Commisso, but it is definitely on the agenda.

The Cosmos, one of the better-known names in the second-tier North American Soccer League, had been tied to a rights deal with One World Sports, which has struggled on its own and is currently seeking a buyer. Commisso’s deal to acquire the Cosmos from Sela Sports and former Cosmos chairman Seamus O’Brien does not involve One World Sports.

The Mediacom chairman is now the majority owner — O’Brien retains a minority interest in the club — of the soccer team that once held court for the biggest names in the sport. Under another former media mogul, the late Warner Communications chairman Steve Ross, the Cosmos fielded teams in the 1970s with such icons as Pelé, Giorgio Chinaglia, Franz Beckenbauer and Carlos Alberto.

A lifelong soccer fan — he said during a conference call announcing the deal that he turned down a chance to join the group that purchased Italian soccer club A.S. Roma in 2011 out of loyalty to rival Juventus, his boyhood favorite team — Commisso pledged to help rebuild the Cosmos, starting with paying back wages to players and front office staff. The TV deals will come later.

“It’s crucial long-term; it’s not crucial today,” Commisso said of securing a new TV deal. “I have lots of contacts out there. It’s on the agenda to deal with the broadcasting rights and the cable rights.”

REBUILD EFFORT

Of more urgent importance are matters like putting the team back together after players were allowed to find other places to play because the Cosmos’s finances were so dire before Commisso (hailed as a savior on the call by team chief operating officer Erik Stover) stepped in. The team has only three players under contract at the moment. The Cosmos also lack a home stadium, though Commisso said the aim is to find a stadium within New York City’s five boroughs.

The NASL already has a rights deal with beIN Sports and CBS Sports Network to carry games, but some critics have said the Cosmos separate deal with OWS has hurt viewership. The fledgling NASL, a Division II league under top-tier Major League Soccer, has lost clubs over the years and has struggled to find an audience.

Currently, the NASL has contracted from 12 teams to eight, a number that Commisso hopes to grow. “I think I am getting into this situation with my eyes open,”he said on the call. “I think I bring my entrepreneurial experience, my resources, the connections I have worldwide with the financial community and the media community.”

GOAL: GROW THE LEAGUE

One of the conditions of Commisso’s deal was that the U.S. Soccer Federation affirm the NASL’s Division II status, which the governing body did on Jan. 6. The USSF also moved the third-tier United Soccer League (from which the NASL sprung in 2011) to Division II, which could fuel speculation about a future merger. The USL currently has about 30 teams.

Both leagues were granted provisional status, meaning they still have to meet requirements around the number of teams (at least 12 by the sixth year of operation), locations (at least 75% in major metro areas) and minimum financial guidelines for team owners. While USSF has granted waivers for the leagues in the past, it said it would work with NASL and USL to meet the necessary criteria.

According to reports, Division II status brings public relations and marketing benefits from the perception that play is more competitive, which also could lead to better TV deals and bigger crowds. Division-two teams also get to appear later in the Lamar Hunt U.S. Open Cup, a single-elimination tournament that includes teams from all three divisions, including MLS, as well as from amateur leagues.

The National Basketball Association set its media roster into the next decade on Monday, with the first rights deal under new commissioner Adam Silver delivering plenty of green.  

The pro basketball league announced the renewals at Saint Regis Hotel in Manhattan at 10 a.m. on Oct. 6, with Silver joined by ESPN president and Disney Media Networks co-chairman John Skipper, Turner Broadcasting System president David Levy and Ted Leonsis, owner of the Washington Wizards and chairman of the NBA's media committee.

Incumbents ESPN and Turner Broadcasting System, both within their exclusive negotiating windows, retained their rights with increases that more than doubled their current annual outlays. Under the eight-year pacts that run through the end of the 2015-16 season, ESPN has paid an average of $485 million per season, about $40 million more than Turner’s $445 million.

Turner announced its new nine-year extension, adding 12 regular-season contests per season to 64 games and enhancing digital rights. ESPN did likewise, saying its new nine-year NBA deal enhanced ESPN's rights and added 10 more regular-season games per season to ESPN or ABC, to a total of 100. The worlwide leader will also steer an over-the-top service in which the leage will retain an equity position.

Given the scarcity of major properties and the value of live sports from a Nielsen perspective, the NBA fetched a steep renewal increase. Reports had suggested the new deal will cost each player some $1 billion annually over a new eight- or nine-year term. On Sunday night, The New York Times reported the deal was worth $24 billion over a nine-year term.

With DirecTV and the NFL extending their Sunday Ticket out of market package on Oct. 1, the NBA deal will wrap up media rights for all of the major pro sports leagues for some time. The only other significant package that may become open: the Big Ten Network, whose first tier rights expire after the 2016-17 academic year.

There have been reports that there could be a sharing of the NBA Finals, which have been airing on ABC since 2003, with TNT getting into the mix. The championship round will continue to air on ABC under the new pact.

Another point of schedule interest could be Thursday nights. Long the home of a doubleheader, TNT's exclusive NBA telecasts could encounter early-season ratings softness should the NFL elect to extend its Thursday Night Football package to a broadcast partner for a full season.

In addition to its Thursday doubleheaders, TNT has been airing much of the All-Star Weekend festivities including the game itself, plus the majority of the playoff action, highlighted by a conference final 

ESPN’s package encompasses Wednesday and Friday night action, playoffs, alternating the conference finals with TNT, and The Finals, which run on broadcaster, ABC.