Must Read For American Sports Fans: NY Times' "Remote Control: Inside The Power Of ESPN"
/Outside of the USA I can't imagine the three-part NY Times story on ESPN to be of much interest, but in light of the recent Fox Sports deal to acquire USGA events along with ESPN's role in broadcasting the Masters and The Open, and Golf Channel's place in the cable "bundling" world, this three-parter is a must for sports business fans.
Parts one and two of the stories by Steve Eder, Richard Sandomir and James Andrew Miller deal mostly with college football, while part three gets into ESPN's future and the potential for ending the bundling of channels that lets ESPN take in $6 billion before ever selling a single ad.
But Matthew Polka, the industry lobbyist for small cable operators, said, “On à la carte, there was no stronger opponent than Disney and ESPN.”
And ESPN has no more stubborn nemesis than Mr. McCain. This past spring, with cable rates and ESPN’s monthly fees continuing to rise, he revived an effort aimed at undoing bundles.
“Why do I pick on ESPN?” Mr. McCain said in an interview in May. “I’m not picking on them. But they are the most glaring example of what people are required to watch — I mean pay for — even if they never watch it.”
And there was this, which could either be seen as justifying the overpaying for sports rights, or...
Meanwhile, companies like Google, Sony and Intel are planning virtual cable services that would be delivered on the Internet. They could lure consumers from traditional pay television as low-cost alternatives to traditional pay TV while also competing for major sports properties when ESPN’s contracts eventually expire. Mr. Skipper said he would make deals with these upstarts, but only on ESPN’s terms: they must take all of ESPN’s offerings, not just the ones they want.
With the rise of new competition come questions about the fate of existing customers.
Consumers are fleeing pay TV at a quickening pace: 898,000 in the past year, nearly twice the number in the previous year, the analyst Craig Moffett said. And in the past two years, ESPN has lost more than one million subscribers.
What’s more, ESPN ratings plunged 32 percent in the quarter that ended in June.
Mr. Skipper’s task — very different from that of predecessors who built ESPN into a powerhouse — is to negotiate a deeply uncertain future.
“It’s a high-class problem,” he said.