ESPN Cuts...
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Thread: ESPN Cuts...

  1. #1

    Join Date
    Oct 2004
    Richmond, Victoria, Australia

    ESPN Cuts...

    Has sports media gone too far in chasing broadcast rights?

    "ESPN on Wednesday began another round of layoffs, this one aimed at on-air personalities, perhaps the starkest sign yet of the financial reckoning playing out in sports broadcasting as cord-cutting proliferates.

    ESPN is by far the biggest and most powerful entity in the industry, and it also may feel the sting more as viewers turn away from traditional ways of consuming live sports.

    The network has lost more than 10 million subscribers over the past several years. At the same time, the cost of broadcasting major sports has continued to rise. ESPN committed to a 10-year, $15.2 billion deal with the N.F.L. in 2011; a nine-year, $12 billion deal with the N.B.A.; and a $7.3 billion deal for the college football playoffs, among many others."
    Radio station employee...<br />Amateur photographer...<br />Cat slave...<br />Sarcasm expert...<br />Annual USA visitor...

  2. #2
    I'm a neophyte when considering the business of radio, much less sports radio, but is this a portent of the distant future of "pay to play"? I.e., OTA (free to the viewer) broadcasts of NFL, MLB, etc. may eventually come to an end?

    I thought ESPN was in the category of too big to fail, or untouchable when it comes to stuff like this. When I first read of layoffs, I was stunned.

  3. #3
    ESPN's financial performance was a big beneficiary of the growth of cable television, and the trend towards 'cord cutting' is now having an outsize impact on its current financial performance. ESPN does, and will continue to, bring in a lot of revenue, but it's going to be less than it was in the past. ESPN lived large on 'per capita' assessments from cable companies which allowed the network to realize revenue from a lot of people that could care less about sports. ESPN will have to develop and market a product that will sell on an a la carte basis. Serious sports fans will pay up for it, but there are only so many of them, so the free riding revenue that set financial records in the past will be hard to match going forward. The company is therefore making necessary adjustments.

    Not to mention the sports landscape, broadcast wise, is becoming more fragmented. Now Fox and CBS have cable sports nets. Rather than those being able to command carriage fees like ESPN had, the pressure instead has been to re-allocate what ESPN was getting to more networks because people are only going to pay so much per month for cable.

  4. #4
    Thanks for the explanation. Really helps.

  5. #5
    NBC also has a cable sports outlet!

  6. #6
    Quote Originally Posted by max88 View Post
    NBC also has a cable sports outlet!
    As does CBS. Fox has several, including a bunch of regional sports nets.

  7. #7
    Would it be smart for ESPN to merge their sister channels into the main channel and be better off.

  8. #8
    Quote Originally Posted by TVCOOL View Post
    Would it be smart for ESPN to merge their sister channels into the main channel and be better off.
    ESPN's long-term contracts with pro and college sports entities would preclude that -- not enough room on one channel for all those live, must-carry events.

  9. #9
    Quote Originally Posted by TVCOOL View Post
    Would it be smart for ESPN to merge their sister channels into the main channel and be better off.
    Uh, no. If they canned ESPNU or ESPN2 they would be unable to air a third of the games they are contracted to carry. Their college conferences and professional leagues would sue for breach of contract in a New York minute, and probably win big damages.
    "Its music what makes a radio station, and at Live FM, we play the last music around."
    After receiving that copy, I quit the VO industry.

  10. #10
    It might make sense for them to slim down their offerings, but they would need more than one to meet their commitments, as other posters have noted.

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