New Report Shows ESPN in Trouble Financially in Future...

[Yakuza Rich]

http://finance.yahoo.com/news/report-shows-espn-trouble-2-180012377.html

The big kicker in this is that people would be willing to give up ESPN to save $8 a month.

Unfortunately, the big money makers will never lose their job. Guys that are overpaid and irrelevant like Berman, Tom Jackson, Ditka, etc. will stick around. They'll probably continue to throw money at SportsCenter.

I think they are essentially not resolving the main issue. They tried to make it the 'network of sports fans' and it generated a great short-term windfall. But, after a while viewers grew tired of the network and its lack of credibility and professionalism. They were bound to tick off most the fanbases with their own fanboy mentality and lack of journalistic integrity instead of playing the role of the 'straight man' and leaving biases out of it.

When ESPN started...and for about the first 20 years...it was a very serious channel. People did not take sports seriously and therefore they had to counter it by leading the way in journalistic integrity. That's been long gone in favor of a quick surge and now they are paying the price that they may never recover from because they probably lost the credibility from the viewership.

It also doesn't help with the advent of FS1, the NBA/NFL/MLB networks and the access to sports and sports bloggers online who tend to provide far better content and insight than your normal writer at ESPN. And it didn't help that they shutdown Grantland. Supposedly Grantland was a money loser, but it could have served as a loss leader and they likely could have made it more cost efficient if they really wanted to.

I suspect they'll get a surge around the election as 538 has built up credibility during the election. But afterward I wonder how 538 will fare. Especially if they finally make some mistakes in their election projections and that hurts their credibility.






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[lothos05]

If the option to drop ESPN was available on DirecTV, I'd sure as hell drop it. Once I found out that ESPN was part of the Sports package on Sirius XM, I got rid of it. It may be just a drop in the bucket but am glad not to give them money.

 

[big dog cowboy]

The picture of mismanagement.

 

[jterrell]

Just a change of times. ESPN had a tremendous 20 year run but now their twitter feed likely draws more eyes then their late night sportscenter re-runs.

Moving into sports-tainment has failed. Sports fans by and large are purists. There sense of humor is limited to when you dilute the product then they dive out of the plane mid-flight.

The truly shocking thing is Fox Sports 1 essentially copied a dying format; seemingly only to hasten it's death.

 

[Yakuza Rich]

The truly shocking thing is Fox Sports 1 essentially copied a dying format; seemingly only to hasten it's death.

They are doing the same thing on the NFLN as it's producer was a former ESPN big wig. And that's why the NFLN has never really taken off.







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[jterrell]

They are doing the same thing on the NFLN as it's producer was a former ESPN big wig. And that's why the NFLN has never really taken off.







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The NFLN makes sense if only because they can merely keep their product/content for themselves instead of selling to FOX/ESPN. Makes themselves a bidder who sells commercials and cuts out a middle man. Of course it is terribly run and has zero real quality other than games....

But FS1 is shockingly bad. They merely jump in that crowded yet expensive 2nd/3rd tier of sports programming and spent a few million dollars getting it all up and running.

 

[Plankton]

The credibility of the operation isn't what will cause them problems financially. This is sports, after all. It's the price of the rights to broadcast the sporting events. SportsCenter and those types of programs are more marketing elements than anything else for them. I don't think the viewership really cares one way or the other about their sensationalism of issues. I think that there is a reality for people that they are watching less and less television traditionally than ever before. The crux of ESPN's issues are when you are paying billions for the rights to the College Football Playoff and regular season coverage, the NFL package, MLB, the NBA, the World Cup, etc. There's only so much money in the till to purchase all of these, even when you are pulling in over $4 billion per year in subscriber fees. Those fees are at the point where they are going to flatten out, yet the fees to actually broadcast these events continues to escalate. It's an unsustainable model.

ESPN's strength is not the garbage talking head programs. It never was. Their strength is their ability to mass cover and mass broadcast any sport that they have the rights to. With ESPN, ESPN2, ESPNEWS, ESPNU, ESPN Classic, ESPN Goal Line/Buzzer Beater and ESPN3 (OTT), they can put up many games simultaneously, and avoid regional restrictions in a lot of cases. Their operating costs for the rank and file out of Bristol is relatively low. Their background personnel make peanuts because, #1, they can, and #2, the cost of living in Bristol is very low. Their issues with cost are with the event fees themselves as well as the technology (satellite time, mobile broadcast trucks, etc) in putting these events on the air.

 

[Future]

Getting rid of NFL Prime Time is the epitome of what ESPN has done wrong.

 

[Plankton]

Getting rid of NFL Prime Time is the epitome of what ESPN has done wrong.

That wasn't something that they wanted to do - when NBC got the Sunday Night package, they lost their exclusivity to a highlights show at that hour.

 

[jterrell]

The credibility of the operation isn't what will cause them problems financially. This is sports, after all. It's the price of the rights to broadcast the sporting events. SportsCenter and those types of programs are more marketing elements than anything else for them. I don't think the viewership really cares one way or the other about their sensationalism of issues. I think that there is a reality for people that they are watching less and less television traditionally than ever before. The crux of ESPN's issues are when you are paying billions for the rights to the College Football Playoff and regular season coverage, the NFL package, MLB, the NBA, the World Cup, etc. There's only so much money in the till to purchase all of these, even when you are pulling in over $4 billion per year in subscriber fees. Those fees are at the point where they are going to flatten out, yet the fees to actually broadcast these events continues to escalate. It's an unsustainable model.

ESPN's strength is not the garbage talking head programs. It never was. Their strength is their ability to mass cover and mass broadcast any sport that they have the rights to. With ESPN, ESPN2, ESPNEWS, ESPNU, ESPN Classic, ESPN Goal Line/Buzzer Beater and ESPN3 (OTT), they can put up many games simultaneously, and avoid regional restrictions in a lot of cases. Their operating costs for the rank and file out of Bristol is relatively low. Their background personnel make peanuts because, #1, they can, and #2, the cost of living in Bristol is very low. Their issues with cost are with the event fees themselves as well as the technology (satellite time, mobile broadcast trucks, etc) in putting these events on the air.

that is only sorta true.

a. cost of living in bristol is not that great but obviously for the NYC area it is fabulous. they certainly could be in iowa, oklahoma or basically anywhere other than florida or atlanta in the southeast and have reallllly low cost of living. i've worked for a CT company for 5-6 years previously. it's basically equivalent to Dallas minus the toll roads.

b. the price of buying major sporting events was worthwhile because they had content that kept eyes around and thus could sell advertising on a 24 hour cycle. now people leave right after the game and ignore sports center. as a college kid that was my favorite tv show. as an adult it's almost shocking to me when it is on. the sports-tainment business model was set to replace sports center as a draw and it did the trick for a while but the crowd is a tough one in sports. credibility really does matter. us politics has two flavors so this trolling model works, in sports it doesn't.

 

[Plankton]

that is only sorta true.

a. cost of living in bristol is not that great but obviously for the NYC area it is fabulous. they certainly could be in iowa, oklahoma or basically anywhere other than florida or atlanta in the southeast and have reallllly low cost of living. i've worked for a CT company for 5-6 years previously. it's basically equivalent to Dallas minus the toll roads.

b. the price of buying major sporting events was worthwhile because they had content that kept eyes around and thus could sell advertising on a 24 hour cycle. now people leave right after the game and ignore sports center. as a college kid that was my favorite tv show. as an adult it's almost shocking to me when it is on. the sports-tainment business model was set to replace sports center as a draw and it did the trick for a while but the crowd is a tough one in sports. credibility really does matter. us politics has two flavors so this trolling model works, in sports it doesn't.

It's actually nearly completely true. The business model is not sustainable for rights fees. The traditional TV viewing model is also changing, and not sustainable. Until the OTT options can be properly monetized, their revenues are going to continue to decline. They aren't going to be able to hike subscriber fees any higher - they have hit the max saturation point - this is seen with the reduction in their subscriber base. The credibility of talking heads with regards to hurting ESPN's viewers has frankly little to do with their issues. The majority of ESPN's viewers tune in to see sporting events, not garbage talking head programs.

 

[jterrell]

It's actually nearly completely true. The business model is not sustainable for rights fees. The traditional TV viewing model is also changing, and not sustainable. Until the OTT options can be properly monetized, their revenues are going to continue to decline. They aren't going to be able to hike subscriber fees any higher - they have hit the max saturation point - this is seen with the reduction in their subscriber base. The credibility of talking heads with regards to hurting ESPN's viewers has frankly little to do with their issues. The majority of ESPN's viewers tune in to see sporting events, not garbage talking head programs.

Content prices continue to rise... for a reason.
The issue is the value attached has always been to lure customers in for further content. ESPN just followed the network plan.
That's simply not working now for ESPN thus they are failing. But it has been working for Networks whose shows get advertised and watched.
Ratings often decline sharply but the initial episode or two are often quite high after NFL advertising or tie-in.

ESPN ratings for games are equal or up in all non-hockey sports.but WAYYYY down in all non-Live programming.

Everyone is competing for the content because it has tremendous value, just not as much for ESPN, in their stagnated model with zero quality original programming beyond the very successful 30 for 30 series.

 

[jterrell]

It's actually nearly completely true. The business model is not sustainable for rights fees. The traditional TV viewing model is also changing, and not sustainable. Until the OTT options can be properly monetized, their revenues are going to continue to decline. They aren't going to be able to hike subscriber fees any higher - they have hit the max saturation point - this is seen with the reduction in their subscriber base. The credibility of talking heads with regards to hurting ESPN's viewers has frankly little to do with their issues. The majority of ESPN's viewers tune in to see sporting events, not garbage talking head programs.

Basically what I am saying is this:.
If NBC says we've got a new show from the makers of Cheers or Friends a large set of people will check that out.
If ESPN says I have a new series form the makers of First Take we all laugh and laugh and laugh.

 

[Doomsday]

I use to watch ESPN all the time, but their act has really gotten old. Cant remember the last time I watched any thing but a live sporting event on ESPN.

 

[Shunpike]

Our expectations as sports fans aren't really big from a TV station. Just show sports. Pure sports. Leave bias out of it and stop forcing clowns like Stephen A. Smith on us. We will appreciate true sports. Highlights, game analysis, film breakdown etc. Don't get cute. Do the simple thing. Cater to average sports fan and don't insult our intelligence.