News > Deals
NBC in WWF football pact
March 29, 2000: 7:21 p.m. ET

Network purchases stake in wrestling group, to televise XFL games in 2001
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NEW YORK (CNNfn) - NBC on Wednesday formed a tag team with the World Wrestling Federation, announcing a pact that will bring professional football to the network for the first time since 1997, a surprise move that NBC hopes will reenergize its sluggish Saturday night schedule.
    The network, known for hits like "Friends," "E.R." and "The Today Show," will buy a 3 percent stake in World Wrestling Federation Entertainment (WWFE: Research, Estimates), whose stars proudly carry names such as The Rock, Sexual Chocolate and The Undertaker.
    Starting in February 2001, NBC, a unit of General Electric Co. (GE: Research, Estimates), will air WWF's nascent XFL Football League games on Saturday nights, through the championship game in April.
    The agreement calls for each party to own 50 percent of the league and its eight teams.
    For NBC, the deal marks its return to football broadcasting. NBC for many years televised National Football League games, until 1998, when Fox, CBS, ABC and ESPN paid a total of $17.6 billion for the rights to NFL games in an eight-year deal.
    NBC said it would buy about 2.3 million newly issued WWFE Class A common shares at $13 per share for a total investment of $30 million.
    Shares of Stamford, Conn.-based WWFE rose earlier to 18-3/8, but closed at about 17-3/8 on Wednesday on the Nasdaq.
NBC rejigs Saturday night, woos young males

    NBC embarks on an effort to woo males in the 12-24 years old age range, who are generally too active to invest in certain television programming, particularly on Saturday night.
    "We see this league as a tremendous upside for us, a great way to anchor the night," Scott Sassa, President, NBC West Coast, said in a media conference call.
    NBC said it expects the league to be profitable by the beginning of its third year.
Deal rekindles partnership between NBC and WWF

    "The absolute key to the success of this league lies in the incredible success Vince McMahon has had throughout his career in reaching the most elusive audience in television ... young males," he said. "(Saturday) is a night that's ripe for taking," he said.
    The deal also rekindles NBC's relationship with McMahon's pro wrestling empire. In the mid-1980s, the network aired "Saturday Night Main Event" specials, which rotated with "Saturday Night Live" reruns, and featured WWF stars.
    The pact comes just two weeks after sketch comedy show Saturday Night Live earned its biggest ratings number in two years, when WWF wrestler The Rock hosted.
    "It was the highest television rating in that entire 24-hour period," NBC Sports chief Dick Ebersol told reporters.
    WWF said the XFL is talking with a second television partner to complement the NBC portion of the XFL broadcast package. As part of the pact, NBC and WWFE have agreed that the XFL will control all advertising inventory sold during XFL broadcasts.
    In February, WWF chairman Vince McMahon announced the XFL league, which will play its games from just after the NFL championship Super Bowl through late April, just after the Major League Baseball season gets underway.
    The cities for six teams have been announced to date: Los Angeles, Miami, New York, Orlando, San Francisco and Washington, D.C. Two more teams will be announced in the next 30 days.
    "NBC is excited about the investment in WWF Entertainment," said Bob Wright, president and chief executive of NBC. "The WWF is widely recognized as having created a leading brand and has done a remarkable job gathering large audiences in the coveted male demographics."
    Though slammed by television critics, McMahon's brand of entertainment - where muscular brutes and old-school melodrama collide - is wildly popular, particularly among young males. The program "WWF Smackdown," single-handedly lifted rating at the struggling UPN network this year, while books by performers The Rock and Mankind are bestsellers.
    Wall Street analysts, noting that other football leagues have tried and failed to compete with the NFL, say the partners have an above average chance at making the league work, thanks to the WWF's marketing muscle and built-in audience.
    For example, the league intends to encourage more wide-open offensive play and to keep game times less than three hours. It will stick cameras in players' helmets and in locker rooms, eliminate certain rules used in the NFL and grant a weekly pool of bonus money to the winning teams.
"Smashmouth" football, but felons need not apply

    Both NBC and WWFE executive emphasized the league's rough, in-your-face, "smashmouth" nature, implying that the hugely popular NFL game has become somewhat soft. McMahon, in an apparent jab to the NFL, where several players have run into legal troubles, said the league would not include people convicted of certain crimes.
    "If you are a felon, you will not be a part of this league," he said. "We are looking for tough athletes who have a passion for this game, which so many don't have the opportunity to play in the NFL," McMahon said.
    WWF wrestlers will not be involved in the games.
    Analyst Scott Bleier, chief investment strategist at Prime Charter Ltd, said on CNNfn's "Talking Stocks," that he believe that WWF star is rising as the popularity of its products swell, but that he would not likely invest in the stock long term. (WAV 140K, AIFF 140KBack to top


WWF slams expectations - Feb. 29, 2000





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