Loaded with wrestling fans, but few of them paying to watch, China is a potential gold mine for World Wrestling Entertainment. And now, thanks to a revenue-sharing deal with Chinese video platform PPTV, the WWE finally has a way to tap into it.
The new channel will cost Chinese wrestling fans 30 yuan a month ($4.50). In the U.S., a subscription to the WWE’s popular SVOD platform runs $9.99 a month, delivering 16 live WrestleMania events a year.
According to The Wall Street Journal, the WWE found in a study conducted two years ago that it has about 140 million fans of John Cena and other squared-circle stalwarts living primarily in China’s major cities. Short-form WWE content distributed over social media has collected more than one billion views in the past year.
Most Chinese wrestling fans have been consuming the WWE’s longer form video products via online piracy.
“We were surprised by that sizable fan base and confused by the fact that only nine provinces had TV agreements,” said WWE chief revenue and marketing officer Michelle Wilson to the WSJ. “We found out that the content was being consumed on digital sites hosting pirated content.”
Paying for video content is a somewhat new phenomenon in China. But the number of people in the country subscribing to online video services has increased from 22 million to 75 million since 2015, research company EntGroup reports.
“We see the digital-savvy middle class growing,” Wilson said. “The appeal of WWE to the Chinese fan is the same as for those around the world: There’s great storytelling, drama, the story of good versus evil and tremendous athletes accomplishing everything in a 20-by-20-foot ring.”
WWE’s online channel is available in more than 180 countries, including in surrounding areas like Hong Kong, Macau and Taiwan. However, China—which requires foreign media companies to partner with a domestic operator—has been a tough sleeper hold for WWE to break out of.
WWE officials point to the example of the National Basketball Association, which has successfully monetized its ample Chinese audience through a $500 million content licensing deal with local company Tencent Holdings Ltd.
“We’re seeing the NBA have a fair amount of success with their subscription model with Tencent, and we also know that some of the European football leagues are also looking at subscription models going forward,” said Jay Li, head of WWE’s operations in China. “We feel that the timing is right and that the Chinese consumer is increasingly willing to pay for content.”