You might have a stressed business model if…

Times are tough at the WWL.

SI has learned that ESPN will have significant cost-cutting over the next four months on its talent side (people in front of the camera or audio/digital screen). Multiple sources said ESPN has been tasked with paring tens of millions of staff salary from its payroll, including staffers many viewers and readers will recognize. Those with contracts coming up would be particularly vulnerable, sources said. The company is also expected to buyout some existing contracts, which is something rare for ESPN historically beyond a few NFL talents. The cuts are expected to be completed by June. Sources within ESPN say that there is no set list of names yet and stressed that behind-the-scenes people will likely (key word) not be impacted by these cuts.

Last month Reuters reported Disney had a lower-than-expected quarterly revenue, hurt by the drop in advertising revenue at ESPN. In addition, ESPN continues to shed subscribers at an enhanced rate, down to 88.4 million households in Dec. 2016. That number was 100.002 million in Feb. 2011.

Though it remains one of the great destination jobs in the sports media and hiring will continue, ESPN has experienced significant layoffs over the last two years. In Oct. 2015 the company laid off roughly 300 employees, many who had spent their entire professional careers at ESPN. Sports Business Daily media writer John Ourand, in this piece on those layoffs, examined the skyrocketing rights fees and deep distribution cuts that led to those layoffs.

On Sunday when contacted by SI.com, an ESPN spokesperson provided the following statement: “We have long been about serving fans and innovating to create the best content for them. Today’s fans consume content in many different ways and we are in a continuous process of adapting to change and improving what we do. Inevitably that has consequences for how we utilize our talent. We are confident that ESPN will continue to have a roster of talent that is unequaled in sports.”

Remain calm.  All is well.  This is fine.  Ignore the laid off employees behind the curtain.

Hey, look on the bright side.  At least McGarity’s got another reason to cite for his rainy day fund.

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51 Comments

Filed under ESPN Is The Devil

51 responses to “You might have a stressed business model if…

  1. Granthams replacement

    At this rate it won’t be long before Australian rules football is back on ESPN.

    Like

  2. Bulldog Joe

    That stack of IOUs from the University of Georgia isn’t going to keep anyone dry.

    Like

  3. Athens Dog

    Model seems to be trending towards pay per view. Better be winning big to get the eyeballs.

    And solves the bathroom issue………….

    Like

  4. Bright Idea

    Maybe they’ll drop the political slant too and get back to sports.

    Liked by 1 person

  5. Russ

    Expect more remote broadcasts like Fox tried a few years ago. After all, the fans in the stadium really are just a studio audience.

    When the bubble truly bursts, it’s going to be ugly.

    Like

    • Mayor

      I have been wondering for years exactly when that bubble was going to burst. A la carte is going to burst it for ESPN when every granny in the nation takes all the ESPN channels off their sets. Next, then the bubble bursts for pro sports. How much longer can the Major Leagues pay $20Mil/yr for a guy who hits 20 homers and has a batting average of .275 or the NBA for a player who averages 15 points/game? When the $$ stop for the TV people the $$ stop for everybody in sports–including college.

      Like

  6. Former Fan

    As more people go to streaming TV, I think we will see more cuts. ESPN business model only works because they are currently charging one of the largest fees in cable and they are distributed in almost every cable package. However, sports is a love / ignore type of event for the at large crowd. For instance, people either love sports and follow it rabidly, or don’t care that much about it. When a la carte arrives for TV, ESPN revenue will likely shrink a great deal unless people are willing to pay a lot of money for ESPN. Why? Because I imagine somewhere around 2/3s of the public would gladly accept much lower cable bill and drop ESPN if given the choice. Right now, our sports viewing is subsidized by the non-sports fan.

    Real competition would make the cable universe much cheaper for us, the fan. And real competition would also make more money for the players, but probably less overall for the universities… until a new normal was established.

    Like

    • Otto

      The advantage ESPN has is people will binge Game of Thrones mid to late season but people want to see sports live so they can talk about it in the moment before the results are spoiled by clicking on your facebook feed. The other 1/30 who want ESPN would pay for it. I would still likely come out ahead as I would only need ESPN from Labor day until early January.

      Like

      • Former Fan

        What will happen though is that people who like football only, will drop ESPN the rest of the year but have it during football season. Ditto for basketball fans. That will really hurt their bottom line. Right now, that’s not possible, but one day it will be.

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        • Otto

          Not if they introduced year long contracts…..

          Like

        • It is possible. Currently, none of the “skinny” bundle providers require a contract. You can get ESPN via Sling, PlayStation Vue, Direct TV Now, or YouTube TV… and these types of services will continue to pop up – eventually you’ll find one that doesn’t have any holes in your preferred viewing.

          Like

  7. 3rdandGrantham

    Espn’s impressively long dominance is coming to an end. As has been written, their model is not sutainable, and by as soon as 2020 they will not be able to sustain or renew their current contract with various leagues like NBA, NCAA, NFL, etc.

    They are losing something like 60K subscribers a month, and don’t forget the ton of talent that has already exited in the last year or so as well and have moved over to rivals like Fox.

    Like

    • DawgPhan

      the best part is that ESPN basically did this to themselves. No one forced them to pay so much for the college football contracts. They were mostly bidding against themselves for those contracts and still managed to run up the price.

      Like

  8. I turned off my cable last month. I don’t have ESPN at the moment and don’t miss it a bit. I miss NBCsN because they got me hooked into the Premier League in the last couple of years, but oh well. My game plan is to get Sling TV for college football come August and then cut it off by Jan……or do nothing at all. In that case on game day I’ll be either in the stadium or Buffalo Wild Wings. Screw it. I’m done paying all year for crap I don’t watch.

    Like

    • Reipar

      Try PlayStation Vue. $20/mo gets you a ton of live programming plus espn and espn 2.

      Like

    • Sherlock

      NBC does a Premier League game each week on the broadcast channel. Fox also shows a Brundesliga game each week. There is usually a MLS game as well. There is even an occasional La Liga or Series A game. I have a Tablo DVR and use the Tablo app on my Amazon Fire TV. The experience, and picture quality, is superior to the Comcast DVR platform.

      Like

      • I have a small antenna up that gets me all the networks…..except GPTV because they are in the opposite direction from everyone else. Honestly, that is my number one concern. Gotta fix it before high school football kicks off.

        Like

    • Former Fan

      Yep. My friends and I have talked about this too. When we get to a la carte, if ESPN is too much, we’ll forgo it and just go to the sports bar to watch the big game.

      Like

    • David K

      Same boat, cut my cable a few months ago. Not sure what I’ll do in the Fall. I may not even watch any of it and just go with the game of the week on CBS only. If the Dawgs have a big game on ESPN, maybe get out to a bar somewhere. I hate to say it but I really don’t care about watching them play App State at noon anymore, even on TV.

      Like

  9. AusDawg85

    Used to have to buy $500 College Game Day PPV package a few years ago. Maybe we’ll go full circle, but if ESPN drops NCAA rights fees, then why wouldn’t UGAAA just go direct with web streaming? Radio broadcast is already there through an app. Can’t imagine it will cost all that much (as a fan) and still cheaper than season tickets.

    Of course, McGarity will hire Beth Mowins (she’ll be available AND cheap!) as our announcer.

    Like

    • Scott Howard would be even cheaper. 😉

      Like

      • Otto

        ..and better than majority of the TV talking heads. I am not sure who that makes more of a statement about the TV analysts or Howard.

        Like

        • Man, you think more highly of Howard’s game calling skills than I do.

          Like

        • DoubleDawg1318

          I want to stop up my ears whenever we have a big play though. His voice cracks something awful and he has no memorable lines for describing anything. He used the phrase Chubby time for a couple of Nick’s TD’s. Really?! That’s all you can come up with?

          Like

          • Otto

            Musberger “What does Uga think about that?”

            Like

          • 3rdandGrantham

            Yep, way too much screaming. More so, he does not keep up with the action well at all, especially when the other team is on O.

            The opposing team could reel off a 27 yard run, and his call on the play will be something like, “Tigers on their own 35….they hand it off to the RB…he cuts outside……and the Dawgs push him out of bounds at our 48.” You’re sitting there listening thinking, WTF just happened?

            Like

            • That is exactly how Howard calls plays for the other team and it is frustrating as hell. When I am forced to listen to him, I catch myself asking “how did they get down to our 30?” or “when did they cross midfield?” Another thing he does that really pisses me off, is when he calls a play that results in a big disappointment for us, he often uses a tone in his voice that sounds like someone just died (the opposite of his screaming). The last thing I need when the Dawgs lose is for the radio guy to get me down even more. He is not a pro by any means and needs to go.

              Like

              • In my rides around the country, I can sadly say that Howard is kinda like a large amount of the others. Lots of screaming and me wondering what the hell just happen.

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                • Trbodawg

                  I’ll never forget listening to the LSU broadcast via SirriusXM one night. 1st guy ” Can you believe that? I can’t believe what I just saw.” “Did you see that?” 2nd Guy “I did, UNBELIEVABLE, never seen that before.”. . . They never did explain what it was. I wonder to this day.

                  Like

      • Sherlock

        Yeah, but think of how glorious it would have been watching the game with Larry calling the game in sync and not several seconds ahead / behind and the ability to hit pause / rewind. We would have had video of Loran Smith with epic sideline reports like this:
        Larry: “Whaddyagot, Loran?”
        Loran: “I just just talked to Coach Mike Bobo. I asked him if he liked peanuts and he said yes. Back to you Larry”.

        We could have had Dan Magil join Larry for the Half-time show interspersed with the Redcoats.

        Like

  10. stoopnagle

    Funny how the people we’re familiar with and sometimes even like and bring us to a show are expendable, but the moron Ivy League MBAs running the operation into the ground keep on keepin’ on.

    Like

  11. sniffer

    WWL lost me (as a stakeholder) long ago. Too political for my tastes. The website is crowded with non sports related crap, imo. What’s the name of that jackass who went off the deep end some years back? Worked with Dan Patrick on SportsCenter?

    Like

  12. 81Dog

    It will be interesting to me to see whether Disney reaches a financial point at which they decide providing actual sports news and commentary on ESPN, rather than social justice warrior programming 24/7/365, is a better business model. But, hey, if they think people watch ESPN to be preached to in a smug, dismissive manner, as opposed to watching it to see highlights, scores, you know, SPORTS stuff, have at it.

    Like

    • sniffer

      I’m thinking Disney is a lost cause, 81. They veil themselves as family entertainment while pushing an “alternative” agenda. Don’t be surprised when Dopey and Sleepy become lovers and Grumpy is sent away for his conservative views…

      Like

      • Don in Mar-a-Lago

        I’m going to tank Disney stock because I already proved beyond the shadow of a doubt with geometric logic that conservatives like Grumpy cannot fail, they can only be failed.

        Like

  13. Normaltown Mike

    I cut the chord nearly a decade ago for a lot of reasons but one was that ESPN had become enamored with the “E” and less caught up in the “S” for my tastes.

    Two things in particular rankle: (1) the amount of stories they do about themselves/the brand/the announcers is annoying and neither entertaining nor sports and

    (2) the mawkish tear-jerker stories ad nauseum.

    The worst in the “touching sports coverage” category that I can recall was a stylized work of fiction they did after Boston won the series in 2004 where a family of lovable “Southies” celebrate and then “pop” tragically dies of a heat attack. Gutter tripe.

    Like

  14. I’m not surprised at the cuts. Their payroll has to be a joke. Far too many ex-jocks doing a lot of talking without saying much at all. A huge percentage of them should have been terminated years ago. When earnings and ratings drop, it’s difficult to justify that kind of inflated overhead.

    Like

  15. HR

    Maybe they can have bob costas do the halftime at SEC games and give us all a lecture on gun control.

    Like

  16. W Cobb Dawg

    That includes abc, espn2, espnu, perhaps the sec, etc. At first I enjoyed the all sports approach. As time went by it turned into talking heads, then multiple channels of talking heads. The actual games are an afterthought.

    Even though we cut the cord a year ago, I’m not gonna hate on espn. I’ve enjoyed many a game on their networks. Dumping the talkers and hopefully getting back to the games is the smartest thing they can do.

    Like

  17. Bcurlle

    Ok Senator, from a long time GTP blog lurker maybe it’s time for you spearhead this cut the cord effort. Me and the queen have been fearing this for months, I’m afraid of the sports DT’S , she’s convinced it’s time. Need yours and the regular posters advice. Help me Obie Wan Blutarski, you’re our only hope.

    Like

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