Estimating Canadian WWE Network Subscribers through Rogers (Q3)

Regarding the estimate for Canadian WWE Network subscribers.

Population of the US is 316M. Population of Canada is 35M. (Source) Historically, WWE reported a "Domestic PPV" number which included US, Canada and Puerto Rico. While Canada is only 10% of the population, PPV buys from Canada were higher - I'd estimate more in the 15% of the total "domestic" buys range. That's a 1.5x multiplier.

Average buys for the normal PPVs (let's exclude WrestleMania, Royal Rumble and SummerSlam) from 2011-2013 was about 120,000 "domestic" buys. We'll assume that's about 102,000 from the US/Puerto Rico and 18,000 from Canada.

In the US, there's about "98 million homes that have cable" (WON 1/20/2014, subscription required). Nielsen estimates there are "116.3 million homes in the US" which have "at least one operable TV/monitor with the ability to deliver video via traditional means of antennae, cable set-top-box or satellite receiver and/or with a broadband connection." If we take the midpoint of these two, let's say the US market for accessing WWE PPVs would be 107M.

Prior to launching the WWE Network, WWE was getting about 102,000 PPV buys out of 107,000,000 "eligible" homes. That's about 0.1%. Let's assume that at least 80% of the Q2 700,000 WWE Network subscribers are located in the United States (560,000 US WWE Network subscribers).  So, 560,000/102,000 = 5.5x multiplier. That is, we're seeing about 5.5x the "normal" US PPV baseline in WWE Network Volume (due to the lower price).

In Canada, only Rogers Communications is offering a version of the WWE Network. That's a base of 5.2 million cable subscribers. Assuming that we're seeing about the higher-per-capita rate of Canadian WWE fans (0.15% in Canada instead of 0.10% in US), that would be 7,500 PPV buys at regular price. using the 5.5x multiplier, that would suggest about 41,000 Canadian WWE Network subscribers. Keep mind the price in Canada is more like $12/month so I'm not even factoring in some price elasticity due to a 30% markup against the domestic/global WWE Network price.

Thus, that's why I would expect that WWE will record something in the range of 40,000 to 50,000 WWE Network subscribers in Canada. Whether they'll actually explicitly tell us that in the Q3 update, remains to be seen!