Troubles at ESPN and perhaps other cable sports networks

[robinreed]

This article has been floating around the web for a few days now but I have seen no mention of it here. If it is in another thread will the mod please remove this.

Big trouble at ESPN financially. They are paying out to much and are making adjustments and reductions. If it hits ESPN it will hit Fox, Comcast and all the others eventually.

http://www.businessinsider.com/cost-cut ... z3fVfxftyJ

The projected increases for the P5 may be a chimera.

[Omaha1]

Fascinating. I'd actually love to see cable go a la carte. I pay like $100 a month to watch about 5 channels.

[Edrick]

Sling TV is all you really need if you want to watch basic cable channels and not pay cable/satellite rates.

[BillikensWin]

Fascinating. I'd actually love to see cable go a la carte. I pay like $100 a month to watch about 5 channels.

A la carte makes sense to everyone but the cable robber barons.

But don't you love having 100 channels of stuff you'd never watch?

[HoosierPal]

Fascinating. I'd actually love to see cable go a la carte. I pay like $100 a month to watch about 5 channels.

A la carte makes sense to everyone but the cable robber barons.

But don't you love having 100 channels of stuff you'd never watch?

It's an event a la carte that might work, not a channel a la carte. I could care less what channel an event is on. I want to see the event, not the broadcasters. I guess that puts me in a Pay Per View category.

[billyjack]

Ironic that the thing that has been described as ESPN's greatest strength (no league contracts except the Big Ten being set to expire until the 2020's), may be the very thing that pops their bubble. $6+ billion spent by ESPN to gain the rights to all of their sports content. It's sort of like the Aesop's Fable about the stag's horns getting caught in the tree branches... or maybe Enron...

[Jet915]

Sling TV is all you really need if you want to watch basic cable channels and not pay cable/satellite rates.

How do you watch FS1 then? I'd switch to sling as well but FS1 is not on it...

[DeltaV]

Sling TV is all you really need if you want to watch basic cable channels and not pay cable/satellite rates.

How do you watch FS1 then? I'd switch to sling as well but FS1 is not on it...

I'm currently internet only; if I can't stream games, I'll get cable for ~4 months, then drop it again come April.

[ArmyVet]

Just saw this pop up on my screen today. ESPN is hurting having just fired 300 people.

John Ourand at Sports Business Journal has the best explanation.

He says it comes to down two big problems for ESPN.
1.ESPN is losing subscribers.
2.ESPN is paying an obscene amount of money for sports.

ESPN is losing subscribers because of a critical mistake it made in 2012 when it was negotiating carriage deals with cable companies like Comcast, Cablevision, and Cox.

According to Ourand, ESPN was negotiating for a $6-per-subscriber fee from the cable companies. To secure that high of a fee, ESPN had to be flexible on its "penetration benchmark levels," or the number of homes that cable companies guarantee ESPN will be in.

At the time, ESPN was guaranteed to be in 90% of cable subscribers' homes. To get $6 per subscriber, ESPN lowered that threshold to 80%.

When ESPN lowered the standard, it allowed cable companies to start introducing new cable packages that excluded ESPN. People are signing up for those cable packages, leading to ESPN's losing 8.5 million subscribers over the past four and half years, according to Ourand citing Nielsen estimates.

[ArmyVet]

I don't know anything about television right packages but this has to be a concern for those leagues anticipating a huge payday:

ESPN is paying $1.9 billion annually to air "Monday Night Football." That's $800 million more than the next closest competitor. Ourand says people are skeptical there was even another bidder within $500 million of that number.

After overpaying for the NFL, ESPN overpaid for the NBA, tripling its rate. It also doubled its rate for MLB rights.

A former employee said, "It’s been a total mismanagement of rights fees, starting with the NFL renewal ... We overpaid significantly when it did not need to be that way, and it set the template to overpay for MLB and the NBA."