Netflix has signed a 10-year deal to stream WWE’s Raw, but co-CEO Ted Sarandos says it does not mean the company is interested in live sports rights.

Sarandos explained on Netflix’s fourth-quarter earnings call that WWE is different from traditional sports, as it focuses on storytelling and entertainment. He said the deal has flexible terms and attractive economics for Netflix globally.

He also said that Netflix is not looking to change its sports strategy, which has been to avoid bidding for live sports rights. He said Netflix is more interested in “sports adjacent” programming, such as documentaries and shows about sports personalities and events.

Netflix has no plans to compete in major sports leagues

The WWE deal raised questions about whether Netflix would try to acquire streaming rights for one of the major sports leagues, such as the NBA, which is expected to renew its media rights later this year.

However, Sarandos dismissed those speculations, saying that Netflix has only had some preliminary discussions with the NBA and that the league prefers to limit itself to three media partners. He said Netflix is unlikely to play a significant role in those negotiations, or any others involving traditional live sports rights.

Netflix paid more than $5 billion for 10 years of WWE’s Raw and other international programming, with an option to extend for another 10 years. The deal also has an out clause for Netflix after five years, in case the deal does not perform well.

Sarandos said the WWE deal is “the inverse of Formula 1”, as WWE is popular in the U.S. but has a small international audience. He said Netflix can help grow WWE’s fan base abroad, as it has done with Formula 1, through its “shoulder programming”, which are shows that complement the main events.

He said this is a proven formula for Netflix, and that WWE is “as close to our core as you can get in terms of sports storytelling”.

Despite Sarandos’s comments, Netflix has a history of changing its mind on key business issues. For example, Netflix used to avoid advertising and cracking down on password sharing, but it has reversed course on both subjects in recent years.

Therefore, Netflix may reconsider its stance on live sports rights in the future, especially if it sees a lucrative opportunity or a competitive threat. For now, however, Netflix seems content with its WWE deal and its niche approach to sports content.


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