“[They’re] embarrassed by your product,” Rupert Murdoch said of USA Network’s handling of the pro wrestling promotion before offering $1.025 billion over five years for ‘Smackdown’ while NBC will pay $265 million to retain Monday-night showcase ‘Raw.’
On May 17 at 9:30 a.m., WWE executive Stephanie McMahon and her husband, Paul Levesque — better known as the fearsome wrestler Triple H — walked into a conference room on the 44th floor of 21st Century Fox’s Manhattan headquarters. They were there for a pitch meeting with Fox leadership, who were eager to acquire WWE’s programming, which includes the weekly Raw and SmackDown Live.
Both shows have been fixtures on NBCUniversal cable networks, and NBCU was fully expecting to keep things that way with a new 10-year deal worth $360 million, sources tell The Hollywood Reporter. But Peter Rice, chairman and CEO of Fox Networks Group, knew that NBCU’s exclusive negotiating window was due to lapse at 4:59 p.m. ET on May 16. By the end of the meeting, the two sides had shaken hands on a five-year deal for SmackDown worth $1.025 billion.
How the deal — which is not yet final but expected to close soon — went down says a lot about the importance of wrestling and other live events to network strategy, especially as the Murdoch family prepares to launch “New Fox” after most of its assets are sold to Disney or Comcast. Sports will become an integral piece of the new company, which will include sports cable nets FS1 and FS2 and the Big Ten Network.
A week after Fox’s WWE handshake, rival ESPN closed the second half of a deal with the UFC — a five-year, $150 million annual linear pact that followed another streaming agreement to put 15 mixed martial arts events a year on ESPN+, the Disney-owned network’s nascent OTT service. All told, ESPN will pay UFC $1.5 billion over five years.
At the WWE meeting with Rice were Fox Sports executives Eric Shanks and Larry Jones and Rupert Murdoch, Fox’s 87-year-old patriarch. CEO Lachlan Murdoch joined the meeting on the phone. Along with McMahon, WWE’s chief branding officer, were co-presidents Michelle Wilson and George Barrios as well as CAA’s Nick Khan and Alan Gold, a partner at EMC (the investment advisory part-owned by CAA). When they walked into the conference room, they saw an enormous TV screen projecting a shot from WrestleMania 34, with wrestler Ronda Rousey lifting the 256-pound Triple H in a fireman’s carry. That photo — displayed with the Fox Sports and FS1 logos superimposed on it — served as an icebreaker for a negotiation that would last two and a half hours.
The deal first sparked into life when Rice phoned Khan (repping WWE) weeks earlier and asked to meet immediately should NBCU not…
