The WWE Network launched on February 24 with a one-week free trial that was not without its problems. (In a previous post for the website inStash, I detailed my own headaches, most of which were worked out after a couple of days.)
In terms of niche value, this is undoubtedly one of the best to come along in quite some time. If you’re a wrestling fan, it’s seriously the most worthwhile development — warts and all — to hit the business in at least two decades.
From a personal point of view, I’m the type of customer WWE is hoping to bring back into the fold. I grew up watching wrestling but haven’t kept up with it in nearly a decade.
When I heard what all McMahon and company were offering, I figured it wouldn’t hurt anything to sign up for the free trial. After some initial frustrations, I hung with it and grew to love everything about it. The content is good, but more importantly, what it represents — a break from the tyranny of cable providers and an embrace of the direct marketing experience — is phenomenal.
(SPOILER ALERT: I’m allowing my trial to convert into a paid subscription.)
It’s a well thought out love letter to consumers everywhere, and despite what an embarrassingly ill-informed Jake Mann of The Motley Fool thinks, analysts believe the company might have sold itself short in estimating just 2 million to 4MM subscribers.
Wisely, WWE remains conservative in expectations, but some are projecting as many as 8 million subscribers. If that held, it would be around $1 billion in annual revenue versus the $83 million the company produced in 2012 PPV sales.
Figures like that are why I’m advising you to buy WWE stock before you buy the WWE Network. As of this post, shares are selling for around $26.
(It’s gone up $3 from where it was this morning.)
That’s before the company has even had a chance to confirm subscription numbers, and before Wrestlemania 30 in April.
WWE stock isn’t typically something that we would encourage in that the business is frequently targeted for the perception (and probability) of heavy drug use on the part of in-ring performers. It’s also blamed largely for an unusually high premature death rate of its talent.
In other words, it’s a business with liabilities, and if “the next big thing” isn’t happening, then it is a pretty stagnant investment.
Well, the next big thing is here.
WWE Network has tremendous heat right now, to borrow from the wrestling vernacular, and the share prices are about as low as they’re going to get for the next couple of months. Buying in while you still can and then holding on to it until those first numbers are announced could stand to make you a lot of money in a very short time. But there probably won’t be another opportunity like this until the NEXT next big thing.
And in the wrestling business, who knows if that will ever come?