ESPN has seen a steady decline in ratings and most importantly subscribers over the past few years. It’s had a huge affect on the bottom line for the company and parent company Disney.
Declining ratings + declining subscribers = less money to charge for advertising on the channel.
It all ended up meaning something had to change for the struggling “Worldwide leader in sports entertainment.” Enter the idea of ESPN+, a subscription-based service that gives access to all ESPN content plus digital-only content that wouldn’t otherwise be available.
The service was launched in April and since then has continued to add both live sporting content and original programming to attempt to attract today’s sports fan.
At $4.99 a month, the goal was to attract those customers who cut the cord but love sports. It was seen as a long-term play and something that wouldn’t take off right away. Sports fans are a creature of habit after all.
But, five months after April’s launch and suddenly the folks in Bristol had reason to party. That’s because they hit the magical one million subscriber mark.
Not too shabby for a five-month old service that many see as an add-on to cable subscriptions.
This is how ESPN celebrated that milestone via their PR folks:
“Reaching one million paid subscribers is an important milestone for any video subscription service, but reaching this benchmark in such a short amount of time is an incredible testament to the teams from DTCI and ESPN who have worked tirelessly to bring this product to market and continually improve it since our April launch,” said Kevin Mayer, chairman, Direct-to-Consumer and International, The Walt Disney Company. “We’re thrilled so many sports fans have quickly come to love the service. The future is bright and we believe growth will continue as we add features, distribution partners and more exclusive content in the coming months.”
But, as with all things press release from ESPN, the devil really is in the details.
What ESPN won’t tell you is that during the five months since launch, they have also rolled all ESPN Insider subscribers in to the ESPN+ fold.
Just how many of those subscribers make up the one million mark ESPN has been touting is a huge question. Numbers for ESPN Insider subscriptions have been hard to come by by themselves, so imagine trying to look in to the PR spin for the truth here.
According to Ad Age (back in 2012), subscriptions to ESPN Insider were around the 670,000 mark. That’s a whole lot of subscribers making the move over to the digital TV service you’re offering and touting.
But, those numbers are six years old and in many cases also include their own secondary layer. Usually subscribers to ESPN the Magazine (yes, that’s still a thing) would have free ESPN Insider access.
So, if you’re following at home we would have to suss out the number of ESPN the Magazine subscribers, then the number of flat ESPN Insider subscribers and finally subtract those totals from ESPN’s one million number.
Let’s say the ESPN Insider subscriptions have been halved since the 2012 numbers. That’s still 335,000 of a one million number — otherwise known as over a third of the subscriptions.
But, ESPN has largely disputed the idea that either of those numbers are correct.
Melvin would also take on former ESPN employee and sports business reporter Richard Deitsch as well.
Me doth think someone protests too much though. There’s also the fact that technically, even if there were only 335,000 “rolled-over” subscribers, having two-thirds as fully paid subscriptions would be a “vast majority.”
However, ESPN doesn’t exactly have the cleanest of track records when it comes to being honest about its numbers. Of course, they have to be in certain areas given they are part of the Disney ecosystem and are beholden to Disney’s shareholders.
The reality is, it is hard to believe that ESPN has magically gained one million subscribers in such a short amount of time all on its very own.
There was help, and likely a large amount of help from rolled-over subscriptions.
What will matter the most is where the numbers stands come the end of 2018 and in April of 2019 when most of those Insider subscriptions are likely to expire.
Are politics to blame for exodus of subscribers from ESPN in 2018?
The Entertainment and Sports Programming Network, better known as ESPN, has been in trouble for some time now. Recently posted fiscal numbers from parent company Disney suggests that the trend downward isn’t stopping any time soon.
According to a report in Variety, ESPN reported a loss of 2 million subscribers in this past fiscal year. For 2018, ESPN saw subscriptions drop to 86 million from 88 million in 2017.
On its face, a 2 million subscriber loss may not portend a great fall for the giants of the sports world. But, fiscally, it’s a massive deal, as ESPN is getting about $8.11 per customer for ESPN and ESPN2 programming bundles.
Add it up and that means ESPN is suffering a loss of at least $16.2 million dollars per month or $194.4 million per year.
That’s a huge problem for a network that has paid billions per year for live sports programming and multi-millions of dollars for on-air talent (on programming like The Get Up that are failing miserably)
For those who are conservative, these types of losses tell the world that the network continues to just not get it when it comes to shoving politics down our throats while we try to watch sports.
But, do the numbers mean what people think? Not exactly.
That’s because almost every Disney-owned cable network has seen a similar decline in 2018.
According to Variety’s report, Disney Channel has also seen its subscribers ebb to 89 million, down from 92 million in fiscal 2017. Freeform fell by 2 million to the 90 million mark. Disney Junior (69 million) and Disney XD (71 million) both lost 3 million subs.
If ESPN were the only Disney-owned cable network losing subscribers at a rate of 2 million (or more) per year there would be some fire to the thought that the politisport nature of ESPN over the past few years would be to blame.
But, that’s clearly not the case given the loss is nearly across the board. Instead of it being politics to blame, it’s very likely other forces are at hand.
So, before you celebrate ESPN losing subscribers to some right-wing or conservative boycott or people being sick of politics being driven down their throats all the time, let’s remember the reality is that it likely has nothing to do with that.
Could it be that those who are sick of those things happening have decided to cut the cord? Sure, but those people are likely a small subset of a larger trend across the country. People in general are increasingly interested in cutting the cord and going with digital subscriptions to things like Hulu, Netflix and YouTube TV to name a few.
Even those who are cutting the cord and going digital with live TV that includes ESPN, they are doing so at a much smaller per-subscriber rate than ESPN can get for the cable side of things.
For example, YouTube TV charges $35 per month for access to over 50 channels. That’s an average price of 70 cents per channel, a far cry from the over $8 charged to customers on the cable platform.
That’s not a recipe for making up not only the overall subscriber numbers, but also the financial bottom line. But, it isn’t the only thing that should be troubling to the powers that be at Disney.
What should really trouble ESPN overall is that of those 2 million subscribers lost, they aren’t making it back up with their new all-digital subscription service either.
Just a few months ago, ESPN celebrated itself for reaching the 1 million subscriber mark for its ESPN+ service. It seems like a great start on the surface, especially for the fact that it took just five months or so to get there.
But, as we pointed out when that number came out, ESPN may be fudging the real number just a bit thanks to how it treated some of its other paid services — namely rolling over its ESPN Insider subscriptions in to ESPN+ subscriptions.
Those numbers were never broken out or told to anyone, even after multiple media request for those numbers. At best we may be talking about 600,000 Insider subscribers and at a low we may be talking about the 300,000 range based on previous digging by other media outlets dating back a few years.
You start to see a problem coming ESPN’s way in 2019 when you look at those numbers too. What happens if the majority of rolled-in subscribers decide not to pony up the $4.99 per month for ESPN+ after their Insider subscriptions expire in 2019.
This may all seem doom and gloom, but if ESPN was looking for a glimmer of hope, it came in the fact that their rate of loss of subscribers went from 3% between 2016 and 2017 dropped to just 2% between 2017 and 2018. So, the rate of loss is slowing according to the numbers.
While all of it adds up to a business that hasn’t figured out how to adapt to the changing times for TV these days, it doesn’t add up to some exodus due to politics as some will spin this.
It does add up to a business that continues to be a drain on the bottom line for parent company Disney and that’s a major reason why change may happen and has already happened with John Skipper’s ouster earlier this year.
We’ll see if the changes ESPN made in its programming bent over the past six months can save the network going forward.
Given the losses sustained the past two years, it could be too little too late though.
Tim Tebow says what most media won’t about Terps coaching fiasco
When the University of Maryland decided to keep head coach D.J. Durkin on Tuesday, the backlash on social media and from the sports media in general was overwhelming.
24 hours later and university president Wallace Loh took action and fired Durkin.
It was a wild period for the university, Durkin and all involved and it left plenty scratching their head. Either it took Maryland too long to do the right thing or they didn’t the courage of conviction to begin with.
On Friday, former Heisman Trophy winner Tim Tebow was asked to weigh in on the whole situation on ESPN’s First Take program and he didn’t mince words.
What was Tebow’s problem? It wasn’t the decision to hire or the decision to fire. Instead, he took Maryland to task for not having the stones to make a decision, get everyone on the same page and stick by what they decide.
“You need to make a decision and you need to stand with it,” Tebow said. “Because right now (the decision to fire Durkin) shows people are so afraid to have conviction to believe in something when they make a decision that they’re like, ‘oh my goodness social media’s against us. Well we’re gonna fire him now.’ You just made a decision to keep him. If that’s your decision, if you believe that’s what’s right for the program, then it shouldn’t matter what I say, what social media says.”
He took them to task especially for listening to the whims of social media and then backtracking because of the mob response to what took place on Tuesday.
“So many people want to be liked instead of being respected. And I think more universities need to stand by what they believe is right.”
Tebow also pointed out that there’s a difference between the debate on social media and in the sports media and what the university has to do.
What exactly was the point of the 10-week investigation if a decision couldn’t be agreed upon by all parties involved or at least followed by everyone involved.
Instead, it appears internal politics and Loh specifically working to keep his job and his reputation intact that was at work here.
As for the sports media, there was a large backlash and even outright advocacy at play.
CBS’ Dennis Dodd outright advocated for mutiny and protest by the Terps players because he didn’t like the decision that was made.
“The Maryland players must protest. Probably a boycott is best. Don’t play, guys. Your lives are at stake.
Some sort of extreme dissent is all they have left. Their university abandoned them. Their strength coach humiliated them. Their head coach created a culture of intimidation. Oh yeah, and one of their brothers collapsed and eventually died running gassers while all of them watched.
Jordan McNair paid for this culture with his life.
Meanwhile, that coach, DJ Durkin, will continue to be paid and return to leading the team.”
Nevermind what the majority of players believe or wish would happen. Nevermind if they believe Durkin is the leader they want to play for or the person they choose to lead them going forward.
The vast minority of players, as in just three according to multiple reports, staged some sort of protest by walking out of either a team meeting or practice.
No doubt there are plenty of raw emotions regarding teammate Jordan McNair and all the things that have gone on behind the scenes.
But, few in the media were willing to say what Tebow said. This should’ve been a chance for Maryland to show a unified voice and stick by a decision they came to.
Instead, they got egg on their face all because they couldn’t be true leaders.
Instead, Maryland succumbed to the whims of social media and advocacy wrapped in the cloak of journalism.
Thus is the power that sports writers have today. One article leads to one tweet leads to a social media ground swell and bam…you have the appearance of a crisis and the need to react immediately.
Urban Meyer scandal highlights ESPN’s declining importance
ESPN likes to use the tagline “The Worldwide Leader in Sports” to describe itself. But, over the past three years that tagline is becoming more propaganda than truth.
No more powerfully so than over the past two weeks, as the so-called “Worldwide Leader in Sports” watched on as former employee Brett McMurphy scooped the biggest sports story of 2018.
Yes, we’re talking about Urban Meyer and the Zach Smith domestic abuse saga. Yes, we’re also talking about an ex-ESPN employee still breaking news with a non-compete clause still in effect.
What did ESPN counter with? It took them four hours to respond to the breaking news by McMurphy, and even at that it was just chopping up what he had to say in his initial Facebook report and crediting him with breaking the story.
Such is the height of ESPN’s irrelevancy when it comes to the written, or should we say, typed, words these days.
Things have been declining for awhile, but for plenty in the sports-news consuming world, ESPN was still the place to go for breaking stories and news coverage.
That was the attitude of 2016. Fast forward two years and you’ll see an online world dominated by opinion pieces and less by actual journalists focused on the big stories of sports.
Names like McMurphy, John Clayton, Ed Werder, Chad Ford, Jayson Stark and others were constantly put on the chopping block. All due to declining subscribers and insane contracts (for talent and product to put on the air).
Sure, not all of the above-named talents were pure writers, but they all were ones who were well-connected and perfectly capable of breaking big stories.
That reality was certainly highlighted over the past two weeks as Urban Meyer and scandal began to break. Ironically, ESPN has had to watch as its former employee runs away with the coverage of this saga.
ESPN has become a reactionary force in the digital media world instead of a powerful source of news and breaking news at that.
It’s what happens when you fire quality journalists.
It’s what happens when you pay bloated salaries to on-air talent that can’t produce ratings.
It’s what happens when you can’t find ways to keep subscribers from cutting the cord.
It’s what happens when you have a major perception problem and do nothing to overtly correct it.
ESPN only has itself to blame for all of those things happening.
Perhaps some day they’ll come back to realizing the value of quality breaking news stories. Either that or ESPN will cease being a place anyone goes to for real news and tunes in to or clicks on for watching live sporting events.
You know, pretty much how it exists for most sports fans today.
But, for those who value the days of ESPN as the first place to go to for breaking news, those days are clearly over.