WWE has recently adopted a new strategy, increasingly featuring Raw and SmackDown wrestlers within the NXT brand. High-profile stars such as Baron Corbin, Mustafa Ali, and Dana Brooke have transitioned to NXT, intensifying with Bron Breakker's challenge to World Heavyweight Champion Seth Rollins to join him in the NXT arena.
Dave Meltzer of Wrestling Observer Radio credited WWE CEO Nick Khan as the architect of this bold maneuver. Khan's game plan is simple yet ambitious:
- Increase the appearance of main roster stars on NXT week by week.
- Spike viewer ratings.
- Enhance the network's appeal for a more profitable contract renewal with USA Network.
WWE's Robust TV Revenue
WWE's significant revenue stream emanates from its television rights fees. Their contracts with NBCU and FOX generate nearly $500 million annually for WWE from 2019 to 2024. These robust TV rights deals helped the wrestling juggernaut to sustain record profit levels during the global pandemic, even when life events were disrupted.
The TV rights fees for Raw and SmackDown are vital to WWE's unparalleled financial success. The primary objective is to negotiate even more profitable contracts. As these negotiations proceed, Khan acknowledges the necessity of enhancing NXT's TV product value.
Meltzer asserts that Khan intends to establish NXT as a third brand, transforming it from a developmental brand to one that stands on equal footing with Raw and SmackDown. This ambition of promoting NXT as a third brand, comparable to Raw and SmackDown, has been discussed frequently.
However, significant progress remains to be made for this vision to materialize. Nonetheless, WWE's business trajectory is flourishing, with Raw and SmackDown TV ratings consistently growing. Meanwhile, NXT is slowly but steadily boosting its numbers, indicating Khan's strategy may be bearing fruit.
Whether or not this trend continues, WWE appears well-positioned to secure an even more favorable TV deal in the ongoing negotiations.