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Still think we get an increase from ESPN at look in time? Think again...
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Mikeyp Offline
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Post: #21
RE: Still think we get an increase from ESPN at look in time? Think again...
(10-27-2015 03:12 PM)NBPirate Wrote:  
(10-27-2015 02:57 PM)Niner National Wrote:  
(10-27-2015 02:51 PM)laser101 Wrote:  espn will easily bounce back.

I don't see how they will. They made a killing from people being forced to bundle their cable with ESPN channels.

Now that there are more options out there than just traditional cable offerings, people are no longer forced to pay for ESPN.

Some of the major telecoms are looking into bare-bones subscription offerings without ESPN included. Right now, most are contractually obligated to, but what about when those contracts are up? If ESPN has to revert to levels where it is only available to people who specifically want to include it in their cable packages, that is a huge revenue loss for them.

People will still have to purchase the WatchESPN app

Why would they have to pay for the watch ESPN app if they don't want ESPN?
(This post was last modified: 10-27-2015 06:30 PM by Mikeyp.)
10-27-2015 06:30 PM
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Attackcoog Offline
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Post: #22
RE: Still think we get an increase from ESPN at look in time? Think again...
(10-27-2015 03:30 PM)wavefan12 Wrote:  
(10-27-2015 03:26 PM)piratefan1975 Wrote:  Most everybody knew the exorbitant rights fees they were paying were a bubble anyway. The timing of all of it sucks for the American, but it was inevitable with the rights fees they were paying and changes to the way cable companies do business looming on the horizon.

They are playing $1.9 BILLION a year for MNF through 2021. If I did my numbers right, that $110 million a game. I just don't get it.


This is why I keep saying that college sports are actually UNDER VALUED. There may be a rights bubble, but it hasn't really hit college spots yet. Also, keep in mind ESPN is HUGELY profitable---far more so than NBC or CBS. Live sports content is the reason why ESPN can charge a ridiculous $6 per subscriber and NBC and CBS cannot. So, if ESPN starts trying to cut the rights fees, NBC and CBS will swoop in and buy them so their networks can eat up some of the $6 carriage fee at ESPN's expense. If ESPN starts losing too much content, that's when they start to REALLY get into trouble. Losing a few million subscribers is nothing compared to losing a dollar or two off their monthly carriage rate. That would be devastating. That's the real reason rights fees are not going down. ESPN may cut expenses elsewhere to boost profits, but that live sports content is what drives their high subscriber levels and even higher subscriber rates.

The other reason I think people are overestimating how far cutting the cord is going to go. Right now Comcast is moving toward "metered internet billing". The more bandwidth you use, the more you pay. If you are streaming a ton of stuff, your internet bill may one day rival your current cable bill. Its still early yet, but if the move to streaming becomes as big as people think, these providers are going to need to expand capacity. That wont be free. Guess who's going to help them pay for that extra capacity.....

Comcast Moving Toward Metered Internet?
https://www.yahoo.com/tech/s/comcast-wan...nance.html
(This post was last modified: 10-27-2015 06:57 PM by Attackcoog.)
10-27-2015 06:42 PM
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PirateTreasureNC Offline
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Post: #23
RE: Still think we get an increase from ESPN at look in time? Think again...
(10-27-2015 06:42 PM)Attackcoog Wrote:  
(10-27-2015 03:30 PM)wavefan12 Wrote:  
(10-27-2015 03:26 PM)piratefan1975 Wrote:  Most everybody knew the exorbitant rights fees they were paying were a bubble anyway. The timing of all of it sucks for the American, but it was inevitable with the rights fees they were paying and changes to the way cable companies do business looming on the horizon.

They are playing $1.9 BILLION a year for MNF through 2021. If I did my numbers right, that $110 million a game. I just don't get it.


This is why I keep saying that college sports are actually UNDER VALUED. There may be a rights bubble, but it hasn't hit college spots yet. Also, keep in mind ESPN is HUGELY profitable---far more so than NBC or CBS. Live sports content is the reason why ESPN can charge a ridiculous $6 per subscriber and NBC and CBS cannot. So, if ESPN starts trying to cut the rights fees, NBC and CBS will swoop in and buy them so their networks can eat up some of the $6 carriage fee at ESPN's expense. If ESPN starts losing too much content, that's when they start to REALLY get into trouble. Losing a few million subscribers is nothing compared to losing a dollar or two off their monthly carriage rate. That would be devastating. That's the real reason rights fees are not going down. ESPN may cut expenses elsewhere to boost profits, but that live sports content is what drives their high subscriber levels and even higher subscriber rates.

The other reason I think people are overestimating how far cutting the cord is going to go. Right now Comcast is moving toward "metered internet billing". The more bandwidth you use, the more you pay. If you are streaming a ton of stuff, your internet bill may one day rival your current cable bill. Its still early yet, but if the move to streaming becomes as big as people think, these providers are going to need to expand capacity. That wont be free. Guess who's going to help them pay for that extra capacity.....

Comcast Moving Toward Metered Internet?
https://www.yahoo.com/tech/s/comcast-wan...nance.html


YEP, someone gets paid one way or the other....drop programs ...pay for internet....
10-27-2015 06:56 PM
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Niner National Offline
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Post: #24
RE: Still think we get an increase from ESPN at look in time? Think again...
Espn has lost 3.2 million customers in the last year alone. A large percentage of millennial have opted against cable. The millennial demographic is the largest in history, so espn could be in for hard times if that trend continues.

The reality is that espn is grossly profitable because of forced inclusion for anyone that wants cable. If cable outlets ultimately let people opt for packages that do not include sports channels by default, that is a potential loss of billions of dollars.

ESPN current model isn't all that different than schools that fund their athletics programs through student fees. You pay whether you consume the product or not.

It isn't just espn though. Unbundling would hurt all sports channels and probably put a lot of tv stations out of business, sports and otherwise.

As for metered internet, that'll be a market by market thing. Google is making that irrelevant in several markets with dozens more planned. No data caps will occur in Google fiber cities because the telecoms would lose all their subscribers.

With emerging 5g technologies that can significantly outperform standard cable and dsl internet, the opportunity to build out legit high speed wireless Internet isn't far off...and guess who owns a lot of wireless spectrum now? You guessed it, Google.
10-27-2015 07:09 PM
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gostangs Offline
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Post: #25
RE: Still think we get an increase from ESPN at look in time? Think again...
yeah niner is on the target. It isn't that ESPN is profitable, it is that their model is going away. Having choice is going to disrupt the entire money flow. Less of a shock for us, but if you are the piglet on the sixth tit and the pig gets a lot skinnier it can't be good.
10-27-2015 08:19 PM
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blunderbuss Offline
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Post: #26
RE: Still think we get an increase from ESPN at look in time? Think again...
(10-27-2015 07:09 PM)Niner National Wrote:  Espn has lost 3.2 million customers in the last year alone. A large percentage of millennial have opted against cable. The millennial demographic is the largest in history, so espn could be in for hard times if that trend continues.

The reality is that espn is grossly profitable because of forced inclusion for anyone that wants cable. If cable outlets ultimately let people opt for packages that do not include sports channels by default, that is a potential loss of billions of dollars.

ESPN current model isn't all that different than schools that fund their athletics programs through student fees. You pay whether you consume the product or not.

It isn't just espn though. Unbundling would hurt all sports channels and probably put a lot of tv stations out of business, sports and otherwise.

As for metered internet, that'll be a market by market thing. Google is making that irrelevant in several markets with dozens more planned. No data caps will occur in Google fiber cities because the telecoms would lose all their subscribers.

With emerging 5g technologies that can significantly outperform standard cable and dsl internet, the opportunity to build out legit high speed wireless Internet isn't far off...and guess who owns a lot of wireless spectrum now? You guessed it, Google.

This guy knows wtf he's talking about. It doesn't matter if FS1 or CBS swoops in for content.... People that don't watch sports won't pay to do so. The "data cap" nonsense is a red herring. Good luck competing with Google if you try that.

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(This post was last modified: 10-27-2015 08:40 PM by blunderbuss.)
10-27-2015 08:37 PM
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Attackcoog Offline
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Post: #27
RE: Still think we get an increase from ESPN at look in time? Think again...
(10-27-2015 08:19 PM)gostangs Wrote:  yeah niner is on the target. It isn't that ESPN is profitable, it is that their model is going away. Having choice is going to disrupt the entire money flow. Less of a shock for us, but if you are the piglet on the sixth tit and the pig gets a lot skinnier it can't be good.

Your missing the point. The model doesn't work because the cable companies include ESPN on basic cable. The model works because so many people want ESPN that ESPN can DEMAND that they be on basic cable as part of their carriage agreement. Any cable company that cant offer ESPN is in trouble and no cable company can be without its networks.

Yes, some people get ESPN that don't want it. Some people get TNT and don't want it. The reality is a model change isn't going to make much difference. ESPN will cost more (because its no longer subsidized by folks who don't want it), but the same thing can be said for every single network on basic cable. In the end, a different model WILL give consumers complete control over the size of their cable/internet bill. But they will also pay more for every channel they do get and will likely end up paying more for their internet (the last mile of cable/pipe to the home always gets paid). Its interesting what Google is doing, but Im skeptical about Google giving internet away for free forever--that's just not what business do over the long term.

That said, its not like ESPN is not positioning itself for a changing model. Essentially, ESPN-3 is an on-demand internet platform that is already in place and branded. If the model changes completely to what some believe, ESPN-3 will simply become to sports what Netflix is to tv/movies.
(This post was last modified: 10-27-2015 09:02 PM by Attackcoog.)
10-27-2015 08:48 PM
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Niner National Offline
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Post: #28
RE: Still think we get an increase from ESPN at look in time? Think again...
(10-27-2015 08:48 PM)Attackcoog Wrote:  
(10-27-2015 08:19 PM)gostangs Wrote:  yeah niner is on the target. It isn't that ESPN is profitable, it is that their model is going away. Having choice is going to disrupt the entire money flow. Less of a shock for us, but if you are the piglet on the sixth tit and the pig gets a lot skinnier it can't be good.

Your missing the point. The model doesn't work because the cable companies include ESPN on basic cable. The model works because so many people want ESPN that ESPN can DEMAND that they be on basic cable as part of their carriage agreement. Any cable company that cant offer ESPN is in trouble and no cable company can be without its networks.

Yes, some people get ESPN that don't want it. Some people get TNT and don't want it. The reality is a model change isn't going to make much difference. ESPN will cost more (because its no longer subsidized by folks who don't want it), but the same thing can be said for every single network on basic cable. In the end, a different model WILL give consumers complete control over the size of their cable/internet bill. But they will also pay more for every channel they do get and will likely end up paying more for their internet (the last mile of cable/pipe to the home always gets paid). Its interesting what Google is doing, but Im skeptical about Google giving internet away for free forever--that's just not what business do over the long term.

That said, its not like ESPN is not positioning itself for a changing model. Essentially, ESPN-3 is an on-demand internet platform that is already in place and branded. If the model changes completely to what some believe, ESPN-3 will simply become to sports what Netflix is to tv/movies.
The industry is so consolidated and also non-competitive that ESPN doesn't have the leverage it used to.

If a carrier decides they're going to offer basic cable packages without sports networks, ESPN isn't just going to say "F off, we won't let you carry our station at all then"

Maybe they can do that will small carriers, but they're not going to do that to to large ones because dropping off a Comcast, TWC, Charter, Dish, or DirecTV would wreck their business. Verizon already has tried to offer an ESPN-less base package and Disney threatened to sue them for breaching their contract. This shows that the carriers are definitely considering this already. Again, it's not just ESPN though that would be dropped, this would screw over Fox Sports 1 as well.

ESPN is definitely positioning themselves for a changing model. They've even indicated they're probably going to offer an ESPN streaming subscription package at some point in the future like HBO Now.

That's great for people that want ESPN and don't want cable, but it still doesn't fix the problem they have with fewer people subscribing to cable services and subsidizing their business model.

Without bundling, I bet at least 50% of the television stations that exist would go under. ESPN wouldn't, but we'd also see them change the way they bid on sports.


Clearly ESPN isn't going away, but it the layoffs we've seen recently are just the beginning. Media is a commodity. The internet killed print media and it is going to drastically change the revenue model for video as well.
(This post was last modified: 10-27-2015 11:18 PM by Niner National.)
10-27-2015 11:15 PM
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Tigermaniac Offline
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RE: Still think we get an increase from ESPN at look in time? Think again...
That's what happens when you overspend on products.
10-27-2015 11:22 PM
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Attackcoog Offline
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Post: #30
RE: Still think we get an increase from ESPN at look in time? Think again...
(10-27-2015 11:15 PM)Niner National Wrote:  
(10-27-2015 08:48 PM)Attackcoog Wrote:  
(10-27-2015 08:19 PM)gostangs Wrote:  yeah niner is on the target. It isn't that ESPN is profitable, it is that their model is going away. Having choice is going to disrupt the entire money flow. Less of a shock for us, but if you are the piglet on the sixth tit and the pig gets a lot skinnier it can't be good.

Your missing the point. The model doesn't work because the cable companies include ESPN on basic cable. The model works because so many people want ESPN that ESPN can DEMAND that they be on basic cable as part of their carriage agreement. Any cable company that cant offer ESPN is in trouble and no cable company can be without its networks.

Yes, some people get ESPN that don't want it. Some people get TNT and don't want it. The reality is a model change isn't going to make much difference. ESPN will cost more (because its no longer subsidized by folks who don't want it), but the same thing can be said for every single network on basic cable. In the end, a different model WILL give consumers complete control over the size of their cable/internet bill. But they will also pay more for every channel they do get and will likely end up paying more for their internet (the last mile of cable/pipe to the home always gets paid). Its interesting what Google is doing, but Im skeptical about Google giving internet away for free forever--that's just not what business do over the long term.

That said, its not like ESPN is not positioning itself for a changing model. Essentially, ESPN-3 is an on-demand internet platform that is already in place and branded. If the model changes completely to what some believe, ESPN-3 will simply become to sports what Netflix is to tv/movies.
The industry is so consolidated and also non-competitive that ESPN doesn't have the leverage it used to.

If a carrier decides they're going to offer basic cable packages without sports networks, ESPN isn't just going to say "F off, we won't let you carry our station at all then"

Maybe they can do that will small carriers, but they're not going to do that to to large ones because dropping off a Comcast, TWC, Charter, Dish, or DirecTV would wreck their business. Verizon already has tried to offer an ESPN-less base package and Disney threatened to sue them for breaching their contract. This shows that the carriers are definitely considering this already. Again, it's not just ESPN though that would be dropped, this would screw over Fox Sports 1 as well.

ESPN is definitely positioning themselves for a changing model. They've even indicated they're probably going to offer an ESPN streaming subscription package at some point in the future like HBO Now.

That's great for people that want ESPN and don't want cable, but it still doesn't fix the problem they have with fewer people subscribing to cable services and subsidizing their business model.

Without bundling, I bet at least 50% of the television stations that exist would go under. ESPN wouldn't, but we'd also see them change the way they bid on sports.


Clearly ESPN isn't going away, but it the layoffs we've seen recently are just the beginning. Media is a commodity. The internet killed print media and it is going to drastically change the revenue model for video as well.

I don't agree. The model is irrelevant because its just a delivery system. The key is content and control of content. Whether it comes over the internet, though a wire or cable, or via broadcast wave---nobody really in the end cares. What they care about it the actual content, its entertainment value, and the quality of image and sound they receive. Whether it be movies, tv series, or sports---in the final analysis, its all about the content.

As long as ESPN has a massive catalogue of sports media rights---sports that millions of fans want to see, they will be fine. There will always be a way to monetize the value of that sports content. The delivery method or way they are compensated isn't really that big a deal The only REAL danger ESPN faces is losing those content rights---because unlike CBS or NBC, ESPN does not produce the actual content that makes them so much money. Keep in mind, the cuts people keep referencing are simply to hit some arbitrary target goal that Disney has decided upon. If ESPN attempts to squeeze the content producers to get their profit up even higher, one of two things will eventually happen.

1) Another entity will purchase those rights for more money, because they can make plenty of money off of the rights at the higher price---it just wont be the obscene target return that the Mouse House wants to make.

The second option is much more ominous for ESPN--

2) If squeezed too much, the sports entities, who actually produce the CONTENT that makes ESPN so much money, will create their own distribution system. By doing this, the leagues will realize the FULL value of their content. This is what happened last time ESPN played hardball with the Big-10. Delany threw ESPN a deuce and created the Big-10 Network with Fox. We already see the Big-10 is making as much from their own network, which owns just a small portion of the Big-10 rights, as they do selling the bulk of their rights through traditional channels. This option is the biggest danger to ESPN---not streaming. Despite all their power, in the end, ESPN is just another middle man. That's why I don't see them being able to just arbitrarily roll back content prices because they want to hit an ever growing profit target. The marketplace doesn't work like that.
(This post was last modified: 10-28-2015 02:20 AM by Attackcoog.)
10-28-2015 02:03 AM
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