🏈 ESPN's making some tough financial decisions

[planomateo]

Households cutting the cord, al-la-carte TV, and the younger generation growing up watching shows via other means is going to impact them even more in the future.

We're already seeing bits and pieces of this - Verizon's Customer Choice programming option (I also understand Verizon is trying to launch streaming service where they don't have FIOS footprint).


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http://www.washingtonpost.com/blogs...-is-making-espn-do-some-serious-cost-cutting/

Despite holding the television rights to nearly every sport that anyone wants to watch, ESPN apparently is not the cash cow that it once was for parent company Disney, which reportedly is demanding that the all-sports network slash its budget over the next two years.

In Wednesday’s story about Keith Olbermann’s impending departure from the network, the Hollywood Reporter says Disney is forcing ESPN to cut $100 million from its budget next year and a staggering $250 million from its budget in 2017. The Wall Street Journal reported Thursday that ESPN has lost 3.2 million subscribers in more than a year and that ESPN’s reach in U.S. households has fallen 7.2 percent since 2011. Last month, Bloomberg reported that operating income dropped 2 percent at Disney’s media networks division, which includes ESPN.

Not renewing Olbermann’s contract when it expires at the end of the month is just one sign of the serious cost-cutting at ESPN:

— It didn’t renew Bill Simmons’s contract after he reportedly demanded $6 million per year.

— It reversed course on moving the “Mike & Mike” radio show to the same Times Square studio used for Olbermann’s show after making a very public announcement that the show would be moving from Bristol to the Big Apple. ESPN leases the studio from Disney at a cost of $40 million, according to the Hollywood Reporter.

— Lou Holtz, Bobby Knight, Mark Schlereth, Bram Weinstein: All allowed to retire or walk away or agreed to have their roles drastically reduced. Weinstein reportedly wanted more money than ESPN wanted to pay him.

And that could merely be a taste of what’s to come, especially with ESPN’s NBA costs ballooning from $485 million per year to to $1.47 billion annually starting in 2016-17. The Big Ten’s TV rights are coming up for renewal soon — it’s the only major U.S. sports entity with a looming negotiation — and considering the current economic climate at ESPN, it wouldn’t be surprising if the conference’s games move someplace else after the 2016-17 season, when the current deal ends. The network currently pays the conference $100 million a year to televise college football and basketball games, and that number is sure to significantly increase.

Viewers also likely can expect to see ESPN’s announcers call even more college basketball games from a studio in Bristol instead of live at the stadium, as they did for 47 games last year (to tepid reviews). Those traveling “SportsCenter” extravaganzas you’re seeing this summer also could get cut back.

And if I were working for a Simmons-less Grantland, 538 or the perpetually stalled Undefeated project, I’d also be a little wary.

In the meantime, we’ll all wait and see what ESPN does with radio host Colin Cowherd with his contract expiring later this year. He’ll want more than he’s making now, obviously. Whether ESPN will pay him remains to be seen.

 

[bama alum]

Keep Bill Simmons and Mark Schlereth and fire Jesse Palmer, Joey Galloway, and Pam Ward. They all black eyes for the network.

 

[TheChief]

It seems to me ESPN is all NBA all the time. I don't watch that show business. I also grew sick of watching a Sports Center program that did little other than report on how much money every player and coach was now making in their brand new contract.

Now, if Bama is playing on ESPN. Yeah, I'll watch.

 

[Destiny's Child]

Disney has had a horrible effect on ESPN and now it doesn't relate well with its base audience. Also, charter is the Devil and I know a ton of my friends have cut the cord.

Disney did a slow make over on ESPN turning it into a liberal propaganda machine that is so worried about being"PC" that it lost it's edge. The type of person that watches doesn't want to watch 24 hour coverage of Micheal Sam being the first openly gay seventh round pick, who couldn't even make the practice squad, and is now getting run off Canadian football team. Didn't care he was getting drafted didn't care he got cut.

They have begun to slide their liberal spin to everything and it's obvious and is the wrong audience for it. We want to watch sports and have jocks with similar sense of humor make comments about it. Not watch the Pakistan spelling bee or any of the other stupid programming. Too many talk shows and not enough sports or highlights. Reminds me of the demise of MTV., they used to play music videos then they got into bad tv shows that made you upset about what our youth was all about.. Teen mom and spring break games.

They need to get back to what they did. Do highlights, have funny people have fun with it and show games on tv. Stop the original programming and the liberal agenda and free ESPN from the same fate as ESPN!

 

[TerryP]

Here's a question that's been asked lately.

If you look at the main demographic group for watching ESPN why are they featuring the Jenner story (versus today's athletes as example?)

I'll leave the "liberal agenda" argument to you guys. Bad programming decisions? That's a given.

 

[bcracker]

@Destiny's Child I do believe you are a genius!

 

[planomateo]

Even when ESPN covers sports, I can only watch it for a brief amount of time. Their reporters/commentators/anchors aren't very entertaining these days. They talk about things that I don't care about and don't talk about the things I care about. They've lost their edge and I rarely watch them, maybe once a month at this point. I watch it more once college football starts up.

 

[Destiny's Child]

@Destiny's Child I do believe you are a genius!

Thanks Bcracker! My wife would find that very funny.

 

[bcracker]

@i know what you mean, brother! I've got one of those too!

 

[We All Bleed Crimson]

I'd prefer that politics and sports be kept separate. The powers-that-be should stop pushing their
agendas in every venue they can find! It's really rather sickening.
Sports is a change of pace where we can get away from the "everyday crap" thrown at us in life. Yes, sometimes there is crap thrown, but it's sports crap...

Perhaps, the sports world should push for a political change...Let's call it the separation of sports and state.....
Just a thought.
ROLL TIDE!!!

 

[Destiny's Child]

I'd prefer that politics and sports be kept separate. The powers-that-be should stop pushing their
agendas in every venue they can find! It's really rather sickening.
Sports is a change of pace where we can get away from the "everyday crap" thrown at us in life. Yes, sometimes there is crap thrown, but it's sports crap...

Perhaps, the sports world should push for a political change...Let's call it the separation of sports and state.....
Just a thought.
ROLL TIDE!!!

So you have noticed the slant they have also? Once you start looking for it you will hear it almost every time you turn their station on. It's the reason why I don't watch it very much anymore except for games.

I used to love the stuart scott, "cool as the other side of the pillow" and ... "the whiff". You know the highlights and funny comments. Somewhere along the way they have tried to become CNN about sports. All they do is talk about who is hitting who, who got arrested, who is coming out of the closet, how sterling is a racist..blah,blah,blah

Here is an idea do highlights show live sports and when there is dead time show old games or something. There only needs to be one Clinton News Network.

 

[bama alum]

Not surprisingly, the pinheads who run ESPN really did try to keep Cowturd (priorities of that station lately..).

http://thebiglead.com/2015/07/16/colin-cowherd-leaving-espn-whats-next/

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Colin Cowherd Leaving ESPN, What's Next?
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Colin Cowherd, a prominent national voice on ESPN radio since 2003, is leaving the network, multiple industry sources tell The Big Lead. While no destination is finalized, talks are progressing towards a deal with Fox Sports. The move away from the Mothership does not come as much of a surprise for anyone who follows these things closely, or has been listening to Cowherd’s show for the past few months.

But, the timing will leave a gaping hole in ESPN Radio’s weekday lineup and has broader implications about where some things are going both in Bristol — few will forget the great talent exodus of 2015 at ESPN, which has seen the network lose other outspoken voices in Bill Simmons and Keith Olbermann — and in general sports media. The difference here was that ESPN did make an aggressive bid to keep Cowherd, but was upstaged by Fox, who are clearly looking to make a big splash.

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“We’ve enjoyed a mutually beneficial run with Colin for over a decade,” ESPN president John Skipper told TBL in a statement. “He came to national prominence on ESPN with his unique perspective on sports and society. Endings also bring new beginnings, for ESPN and Colin, and we thank him and wish him the best.”
So why leave ESPN now?

Near the top of the list would be a reunion with Jamie Horowitz, the new President of Fox Sports, who produced SportsNation with Cowherd and Michelle Beadle, as well as Cowherd’s Sunday morning football show a couple years ago. Perhaps Fox has a multi-faceted plan that may include a Cowherd-driven Sunday morning football pregame show on Fox that airs before the Sunday NFL pregame show?

It’s not currently known what Cowherd would do for FS1. One potential idea is to put him at 6pm and attempt to better compete with SportsCenter with a talk-driven show, which Horowitz previously had a lot of success (depending on how you define the word) with at ESPN2.

At ESPN, Cowherd wanted to be simulcast on a network with better distribution than ESPNU, but there wasn’t any way he was going to supplant SportsCenter (ESPN) or First Take (ESPN2). As far as simulcasting goes, if Cowherd’s radio show lands at FS1 – industry sources say Sirius and DirecTV a la Rich Eisen are in play – will he have the same issues as Mike Francesa, who often gripes about being preempted?

Cowherd recently expressed some of his thoughts about the future of radio on the About Sports Radio podcast with Zach McCrite, which could give a hint as to where his show will land, and how it could change his pay structure: “In the next 5-10 years, I don’t even think they’ll have radios in cars. I think podcast and digital and Sirius is the future. I think terrestrial — AM especially — is done in five years.”

On that podcast, Cowherd estimated that his show makes $18-20 million a year on radio alone, but speculated within two or three years that his program would go from radio show simulcast on television to vice versa.

Returning to the point about cars, Apple and Google are introducing products that will essentially turn dashboards into tablets. The New York Times wrote about this in February:
After years of being treated as an interesting side business, autos have become the latest obsession for Silicon Valley, with Apple assigning about 200 people to work on electric vehicle technology and Google saying it envisions the public using driverless cars within five years. But nowhere is that obsession playing out more immediately than in the battle to develop the next generation of cars’ dashboard systems.

In the coming weeks and months, dealerships around the country will begin selling vehicles capable of running Android Auto, Apple CarPlay, or both. The systems go far beyond currently available Bluetooth pairing for playing music or making a hands-free call, and allow for Google’s or Apple’s operating system to essentially take over the center screen and certain buttons within the car.

Radio shows will be streaming live through these devices, and they’ll also be podcasted. It’ll probably take a bit longer than the five years Cowherd has predicted for a total wipeout — as over two million lingering AOL dial-up subscribers illustrate, old habits persist at least on the margins — but he’s right that it’s coming eventually. While ESPN is certainly invested in its terrestrial radio affiliates, it stands to reason that as smart dashboards become more common they’ll seek out and be courted for partnerships in distribution through them.

Although podcasts are gaining market share at a rapid pace, there aren’t many creators who are making big money on them quite yet. MailChimp told the Wall Street Journal that they paid $25-40 CPM (cost per thousand listeners) for Serial; you’d have to figure the podcast’s second season will command more than that and be quite lucrative. Adam Carolla’s podcast is said to have 120 million monthly downloads (because most of these are automatic from iTunes subscriptions, that doesn’t necessarily mean there were this many listeners), and to have made $14 million in profits since it launched in 2009. Marc Maron also must be making some good money.

None of this has yet approached what Cowherd’s program now grosses on radio.

Though ads have been seeping in more and more in recent months, ESPN hasn’t materially monetized its podcasts yet — recall Simmons ripping them for that this past March. Incentives-wise, even the biggest advertising figures thus far in the podcast industry pale in comparison to Monday Night Football, and as we’ve already noted, terrestrial radio. But, they’re aware of what’s coming. For them, it would be a slippery slope to add revenue sharing to talent contracts. And, the argument that their massive distribution is an asset that makes even the most popular individual replaceable has been the company line during this stretch of intense cost-cutting.

[Related: Mike Francesa: Radio Has Done a Terrible Job Monetizing Digital Platforms]

For Cowherd, it’s undeniable that his reach would dwindle in a move from ESPN to any radio outlet, whether it’s Direct TV, Sirius, or Premiere Networks (which distributes content to Fox). But, perhaps he’s calculated that he’d rather have a bigger piece of a smaller pie, with massive upside if podcasts are indeed better-monetized in the near future. The less-is-more move worked for Glenn Beck when he left Fox News, though he also had a website and streaming digital channel in addition to his radio show. And, all on-air radio talent has taken note of the way Howard Stern has handled business, opting for the biggest payday and unconditional freedom of speech on satellite radio rather than the biggest audience.

Whereas ESPN’s splits with Simmons and Keith Olbermann had something to do with apparent differences with higher-ups about acceptable editorialization — particularly with regard to the NFL and Commissioner Roger Goodell — as well as money, it doesn’t seem like this was a freedom of speech issue for Cowherd. He remarked on the aforementioned About Sports Radio podcast that his bosses rarely interjected in the show. Nevertheless, there’s a roving, invisible line at ESPN that everybody knows is less onerous on other networks.

So, there’s some mutual familiarity with Horowitz, whether Cowherd ultimately would get his own television show, or would be a contributor to several programs on Fox and FS1. For ESPN, who did make a push to keep the host but was not ultimately willing to meet Cowherd’s requisite financial package, there are a lot of questions about its radio lineup both imminently and a couple years down the road.

To me, all I have to say is...