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Tom Barreca Executive VP WWE Enterprises

7/10/2006 6:39 AM Eastern

WWE Enterprises executive vice president Tom Barreca oversees the pro wrestling outfit’s vast digital distribution business, which includes more than a dozen yearly pay-per-view events and WWE 24/7, a subscription video on demand service featuring vintage WWE events. Barreca sat down with Multichannel News programming editor R. Thomas Umstead to talk about the state of the WWE’s digital properties as well as the future of content distribution.

MCN: Are you progressing as quickly as you would like with the distribution of WWE 24/7?

Barreca: Absolutely. I think with the rollout of 24/7 on Comcast Cable later in the summer we’ll have five of the top 10 MSOs on board. I think we may bring on a couple of independents and top 10 guys before the back to school period.

MCN: Did you ever think that you could garner more distribution from operators and greater sampling from consumers if you offered the service free of charge, much like the majority of video-on-demand packages in the marketplace today?

Barreca: We believed that our fans wouldn’t be resistant to paying for access to WWE content that they couldn’t get anywhere else, and I’m not sure that’s true of some other content providers or programmers. This is pretty much the best of our programming and we’ve never really opened up the vault before, so actually we were confident that the model would work.

We also did a fair amount of due diligence in the operator community, and we heard back over and over from them that ‘if anybody was going to make a go at it on the subscription side it would be you guys, given your fan base’. We took that to heart.

MCN: Could you have offered this package as a Web-based, broadband video service where you could have potentially reached more people and generated more revenue than through cable subscription VOD?

Barreca: Possibly, but this business was also about us going out to the operator community and trying to build a bridge with them and to build a stronger, direct relationship with them on the affiliate side. With the PPV business being handled through the consortium that is In Demand, we thought this was a great opportunity to put the WWE in front of every operator, knowing that we could help them build the VOD platform. We entertained the thought of the Web, but it was really about broadening and deepening the relationship with our main distributors.

MCN: Let’s move to the PPV business. You’ve done extremely well with the Wrestlemania series – the WWE has had three straight years of 1 million buys or more for the event. But how are the company’s other monthly PPV events performing?

Barreca: We’ve been pretty steady, and we’ve tried to do some things to bring some innovation to PPV. We’ve offered PPV events on a Tuesday to say to operators, ‘you’ve never generated PPV event revenues on a Tuesday, so let’s try that.’ We’ve also tried to bring interactivity to PPV. I still see it as a fairly robust business.

There are also some institution things that have helped. Operators are switching out digital to analog, and as a result we’re picking up some buys. To some extent that’s provided us with a fair amount of lift.

MCN: Have operators cut back on PPV marketing resources in an effort to promote other services such as broadband or telephony?

Barreca: Obviously as operators diversify their portfolios and add more products and services to the bundle, each individual one can at times see relatively less attention. In our case, one of the things that 24/7 has done is put us in front of the operators and re-engaged them and let them build personal relationships with us. We’ve also seen a lot more activity in operator communities as our live event tours roll into towns and systems.

PPV is a 20-year old business and its lifecycle reaches its own kind of watermark, but we’ve seen more interest recently. In some instances, operators who have not played with us on the PPV business but for the super events are actively working with us as we roll out more resources to their systems. You’ll see that certainly with the Comcast launch of 24/7 later in the summer around [August’s] Summerslam PPV event.

MCN: Are any of the WWE PPV events or its 24/7 service in HD?

Barreca: No. We’ve been looking at it for several years and are testing it right now.

MCN: Where do you see the future of content distribution for not only the WWE but other providers?

Barreca: What’s interesting to me is that coming from a legacy of cable, I think of cable as always being an American business. When I came to the WWE it became a North American business because we’re incredibly prolific up North through WWE Canada. With the digital business, I’m all over the planet, and it’s really interesting to see what other distributors are doing in some other territories and to try to speculate about what’s going to come here. Whether that’s increased interactivity, whether that’s trying to blend what happens on streams, whether that’s SMS [text messaging] programs that are linking mobile to linear television – there’s a lot of stuff going on.

The portability and the acceptance of our content outside of the states have led us to feel that the digital business makes us pregnant with potential as long as we can keep the intellectual property fountain going. So that means more superstars, more storylines and more distinct brands like the ECW. As our third brand, the ECW represents a big growth plank for us on the horizontal side, with me being the vertical guy building more pipes. Between the two we think there’s some nice growth there.

MCN: How will Sci Fi Channel help to build the ECW brand?

Barreca: I think Sci Fi Channel is very committed to their viewers and to the extent that a renewal [of its summer ECW series] happens, I think they will treat us as an excellent piece of anchor programming as USA does [with the WWE Raw series]. [Sci Fi Channel and USA Network parent] NBC Universal Cable’s commitment to us and the reciprocity of co-marketing – everything from press and community relations initiatives to how we approach affiliates -- has been really cooperative and positive. Sci Fi is a natural extension of that, and we foresee this as a fluid step forward.

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