For over 30 years, WWE has enjoyed a fantastic relationship with one of their longest business partners, Sky. Sky has been through WWE’s ups and downs and have always remained loyal. But their partnership is showing some signs of cracks with the launch of the WWE Network in the United Kingdom.
In Europe, Sky is considered to be the biggest television broadcaster with control over the United Kingdom, Germany, Italy, and other markets. It’s a big company with a lot of cash and a lot of power. Basically, you want them on your side if you want to broadcast your channel.
When it comes to sports, Sky is the king. In the United Kingdom, Sky broadcasts football (or soccer) from the English Premier League and Spain’s La Liga, arguably Europe’s top two football leagues. It also broadcasts the NFL, Formula 1 racing, darts, rugby, cricket, tennis, boxing, and a lot of International football matches. Nobody does sports coverage better than them. Their Sky Sports News channel can pretty much rival ESPN or any top sports news network in the world.
Sky pays a lot of money for rights for a lot of sporting events. In 2012, the broadcaster paid a staggering £2.28 billion – around $3.45 billion – to broadcast the maximum allowed of 116 games of the English Premier League every year for three years. Oh, a whole season consists of a total 760 games – 20 teams and 38 games each. Sky is rarely outbid when it comes to sports although sometimes it does happen. In 2013, Sky lost the lucrative UEFA Champions League contract to rivals BT Sport who paid £900 million for a three year contract.
The new WWE deal with Sky which was signed in January 2014 for five years sees the British broadcaster having exclusive rights for Raw, Smackdown, and Main Event, while also gives them the right to distribute the monthly WWE specials on the Sky Box Office pay-per-view system. Financial details of the deal were never disclosed, but sources said at the time that the value is believed to be about three times that of the previous five-year agreement. The previous five-year agreement, by the way, was deemed the most expensive for a WWE International TV rights contract at the time.
Just days before the WWE announced the launch of the WWE Network in the United Kingdom in January, Sky raised their prices for the WWE pay-per-views, from £14.95 to £19.95. Besides that, starting from this year all 12 specials will air on Sky Box Office. Under the old deal, a couple of them aired for free on Sky Sports 1 for those who had a Sky Sports subscription.
When WWE announced that there will be no Network launching in the United Kingdom in August, fans blamed Sky for their tactics. When WWE said it will launch in October, and then in November, only to have both launches pulled, fans once again blamed Sky. When I talked to the head of Sky Sports over the phone the day after the second failed Network launch in the country, he said that the company had nothing to do with the Network and it was solely a WWE decision. I was also told that Sky was not in negotiations with WWE to carry the Network as a traditional channel, similar to what Canadians have. The statement raised eyebrows among WWE fans in the United Kingdom as all of them were pretty sure that that was the case despite what Sky was saying. Sky charges a lot of money for their services and a lot of people consider Sky the Antichrist.
WWE eventually bulldozed their way with the Network in the United Kingdom. Stephanie McMahon, WWE’s Chief Brand Officer, told British tabloid newspaper The Sun that they are appreciative of their partnership with Sky, but they have to understand that the Network is completely owned by WWE. Pissing off one of your longest business partners is not a smart thing to do. The United Kingdom, apart from North America, is WWE’s strongest market and that is largely thanks to Sky’s coverage of WWE.
The latest disagreement comes over the airing of Main Event on the Network. This time, Sky flexed their muscle and pretty much made WWE take the show off the Network because they own the exclusive rights in the region. And they are correct. With WWE’s inability to geoblock individual programs, this left the company no choice but to remove it and try to work with Sky for a compromise. As of this writing it does not seem that a compromise is on the horizon. I once again tired to get the 411 about the whole deal but this time, the folks at Sky Sports did not wish to comment yet.
It will be interesting where things go from here. You can certainly understand Sky’s position as well as WWE’s position. WWE wants to make money with the WWE Network. Sky wants WWE to honor their deal, a deal they paid millions for. WWE is locked to Sky till 2019 so problems are not going away anytime soon. It’s now a matter of sitting down and ironing out issues before things get ugly.