Why you should care
Because more NFL means more Skip Bayless.
Goliath is always favored before a fight. Like the 73-win Golden State Warriors, the 18-0 New England Patriots or the famed biblical bully himself, the sustained media dominance of ESPN was all but guaranteed. Until it wasn’t.
Six years ago, the Worldwide Leader was on a tear. The Disney-Hearst joint venture had more than 100 million cable subscribers, and ratings for both live sports and flagship programs like SportsCenter were through the roof. Today, though, the soaring cost of broadcast rights for live sports is driving the network down a path of innovation, and the changing face of SportsCenter signifies an industry in flux.
As a growing number of informed consumers abandons cable providers for personalized streaming options, networks like ESPN and Fox Sports are stuck paying billions for live sports. A scramble to restructure revenue flow has led to layoffs at all levels of the industry, with sports networks showcasing big-name, often-polarizing personalities at the expense of reporters, writers and radio hosts. Soon, sports media — at every level — may look nothing like the days of old.
We will continue to be aggressive in buying live-sport rights. It hasn’t gotten cheaper, but [live sports] have gotten more valuable.
Bob Iger, CEO, Disney
Since launching in 1979, ESPN has expanded its reach by gobbling up television rights to live events. Today, the network pays an estimated $8 billion per year — $1.9 billion to the NFL alone — for the rights to air live programming and highlights from various leagues. “We will continue to be aggressive in buying live-sport rights,” Bob Iger proclaimed during a conference call in May. “It hasn’t gotten cheaper, but [live sports] have gotten more valuable.” Meanwhile, the company has lost more than 13 million subscribers — down to roughly 87 million — since 2011. For perhaps the first time in his 12-year stint as Disney CEO, Iger had to defend the business of ESPN, which dragged down second-quarter earnings.
There’s little doubt that live sports is still a booming market — viewers watched 31 billion hours of sports in 2015 — but as cord-cutters grow tired of paying cable providers $9.04 monthly for ESPN’s package of networks, streaming services like Amazon, which recently acquired live rights for all 10 of the NFL’s “Thursday Night Football” broadcasts, become increasingly enticing. One response from ESPN: innovative programming. “The way we present information has to evolve because technology is forcing change,” Jemele Hill, co-host of ESPN’s SC6 with Michael and Jemele, tells OZY. “Highlight shows aren’t as effective, and it’s fashionable to hate on ‘debate shows,’ so we quickly replaced the word debate with ‘conversation.’ The best description of our show is a conversation-based SportsCenter.”
SC6 is one of several new-look ESPN shows as the network aims to reel in consumers with digitally friendly programming. The strategy is to mix banter reminiscent of talk radio with shareable audio and video highlights and input from fans on social media. Scott Van Pelt’s oft-comedic, midnight rendition of SportsCenter has enjoyed a ratings lift of 6 percent since the host moved from ESPN Radio in 2015. According to Mike Greenberg, the legendary co-host of ESPN’s Mike & Mike, this shift is a continuation of industry-leading innovation. “I know for certain that ESPN was way ahead of the curve with regard to streaming and podcasting,” says Greenberg, whose new morning SportsCenter launches in January. “We are and will be focused on digital distribution of the new show.”
Two other staples of ESPN, the investigative Outside the Lines and the news magazine show E:60, both recently picked up new Sunday-morning time slots and digitally focused face-lifts. The goal, says OTL and E:60 executive producer Andy Tennant, is for these programs — along with the network’s hit documentary series, 30 for 30 — to become integral pieces of an impending over-the-top streaming service. “We recognize that we have to make the mobile experience great,” Tennant says. “Along with living on TV, that’s where our world-class storytelling can really thrive.”
When Iger says that ESPN will continue to buy high-price rights for live sports events, he’s also saying that in addition to airing games, ESPN will continue to fill cable slots with big-personality-driven programming. Since social media has reduced the effectiveness of highlights and traditional on-air reporting, old-school sports news will phase out. This, of course, is evidenced by ESPN’s recent firing of roughly 100 employees — many well-known reporters, writers and analysts. The moves were designed to cut costs and free up resources for the programming that might help offset a massive live-rights debit.
In late June, Fox Sports followed suit, canning its digital writing staff — roughly 20 employees — in favor of an all-video online platform. In a press release, FS1 executive Jamie Horowitz, who was fired days later amid sexual assault allegations, announced that Fox Sports would be focusing on “our fans’ growing appetite for premium video across all platforms.” The move made clear that repurposing daily rants by Skip Bayless was more profitable than producing original content.
The sports media landscape has reached an impasse. For fans of journalism, particularly the written word, it’s a trying time. Live sports will always be a consistent offering of major networks, and an increase of streaming options can only benefit the consumer. As older, cable-tethered generations begin aging out, consumers who value any sense of choice will no doubt turn to streaming services, or new platforms, for original storytelling.
Speaking of which, ever hear the one about David and Goliath?