Hello There, Guest! (LoginRegister)

Post Reply 
Twelve Ways Sports Networks Will Adapt To Evolving Marketplace--SBJ
Author Message
Attackcoog Online
Moderator
*

Posts: 24,390
Joined: Oct 2011
Reputation: 945
I Root For: Houston
Location:
Post: #1
Twelve Ways Sports Networks Will Adapt To Evolving Marketplace--SBJ
Two articles from the Sports Business Journal on how sports networks will respond to the evolving marketplace and a piece that does a good job of explaining that the sky probably isnt falling for sports rights fees.

https://static1.squarespace.com/static/5...rticle.pdf

https://static1.squarespace.com/static/5...061217.pdf
(This post was last modified: 11-07-2017 06:11 PM by Attackcoog.)
11-06-2017 08:30 PM
Find all posts by this user Quote this message in a reply

arkstfan Away
Sorry folks
*

Posts: 21,397
Joined: Feb 2004
Reputation: 616
I Root For: Fresh Starts
Location:
Post: #2
RE: Twelve Ways Sports Networks Will Adapt To Evolving Marketplace--SBJ
Interesting perspective.
Also interesting is that Disney is trying to buy all of Fox except the news, sports, local TV stations, and OTA Fox Network.

Looks like they are trying to stockpile content and content creation in advance of launching their online product.
11-06-2017 11:58 PM
Find all posts by this user Quote this message in a reply
orangefan Offline
All American
*

Posts: 3,978
Joined: Mar 2007
Reputation: 195
I Root For: Syracuse
Location: New England
Post: #3
RE: Twelve Ways Sports Networks Will Adapt To Evolving Marketplace--SBJ
His point about reducing production costs is demonstrated well by ESPN's deal with the ACC on the launch of the ACC Network. Each school will be constructing an $8-10 million production studio. This will allow the ACC Network and other ESPN networks to produce games and other shows from the schools without sending a portable production studio or any other equipment. These facilities are being funded by the school athletic departments and are a major part of the conference's capital contribution to the ACC Network with a total cost of $120 million+.
11-07-2017 08:42 AM
Find all posts by this user Quote this message in a reply
Frank the Tank Offline
Hall of Famer
*

Posts: 10,728
Joined: Jun 2008
Reputation: 477
I Root For: Illinois/DePaul
Location: Chicago
Post: #4
RE: Twelve Ways Sports Networks Will Adapt To Evolving Marketplace--SBJ
The one thing that sports will always have as an advantage over virtually every other form of entertainment is that people watch them live, which means they are long going to be the most desirable type of programming for advertisers. There's also long-term predictability where you can be reasonably certain that people will still watch the NFL/NBA/MLB/P5 in 10 years, whereas even the most popular scripted TV shows eventually run out of steam. Those factors inherently raise the price of sports.

Also, ESPN and other sports networks may need to change their distribution models. However, I'm always perplexed by the arguments that they've paid too much for the NFL/NBA/etc. Those long-term sports contracts might be expensive on paper, but they're also the only things that will keep ESPN and other sports networks *alive* compared to every other cable network. If you really want to see dead sports networks, it will be if Amazon/Google/Netflix/Apple get exclusive NFL and other marquee sports rights. A lot of observers are "undervaluing the value" of keeping those rights out of the hands of those tech companies for the foreseeable future. In essence, there are a lot of short-term expenses with these sports contracts, but that's really the other way that they can survive in the long-term. I'll never understand the thinking that sports networks can survive by showing less sports. That's foolish short-term stock price thinking in a world where content will always be king. The only thing that costs more for ESPN than the NFL is the cost of *not* having the NFL.
11-07-2017 11:29 AM
Visit this user's website Find all posts by this user Quote this message in a reply
Attackcoog Online
Moderator
*

Posts: 24,390
Joined: Oct 2011
Reputation: 945
I Root For: Houston
Location:
Post: #5
RE: Twelve Ways Sports Networks Will Adapt To Evolving Marketplace--SBJ
(11-07-2017 11:29 AM)Frank the Tank Wrote:  The one thing that sports will always have as an advantage over virtually every other form of entertainment is that people watch them live, which means they are long going to be the most desirable type of programming for advertisers. There's also long-term predictability where you can be reasonably certain that people will still watch the NFL/NBA/MLB/P5 in 10 years, whereas even the most popular scripted TV shows eventually run out of steam. Those factors inherently raise the price of sports.

Also, ESPN and other sports networks may need to change their distribution models. However, I'm always perplexed by the arguments that they've paid too much for the NFL/NBA/etc. Those long-term sports contracts might be expensive on paper, but they're also the only things that will keep ESPN and other sports networks *alive* compared to every other cable network. If you really want to see dead sports networks, it will be if Amazon/Google/Netflix/Apple get exclusive NFL and other marquee sports rights. A lot of observers are "undervaluing the value" of keeping those rights out of the hands of those tech companies for the foreseeable future. In essence, there are a lot of short-term expenses with these sports contracts, but that's really the other way that they can survive in the long-term. I'll never understand the thinking that sports networks can survive by showing less sports. That's foolish short-term stock price thinking in a world where content will always be king. The only thing that costs more for ESPN than the NFL is the cost of *not* having the NFL.


Ive said it multiple times. The biggest threat to ESPN as a major power in broadcasting is not cord cutting. The biggest threat to ESPN is that sports leagues will eventually decide to retain their broadcast rights and use a direct to consumer streaming model to maximize profits. That would set ESPN back abut 30 years to a time when they had nothing but Sportscenter and Lumberjack competitions. ESPN will pay to aggressively fight to retain those rights packages in anyway they can because without those live sports rights, ESPN doesnt survive.
(This post was last modified: 11-07-2017 11:59 AM by Attackcoog.)
11-07-2017 11:56 AM
Find all posts by this user Quote this message in a reply
orangefan Offline
All American
*

Posts: 3,978
Joined: Mar 2007
Reputation: 195
I Root For: Syracuse
Location: New England
Post: #6
RE: Twelve Ways Sports Networks Will Adapt To Evolving Marketplace--SBJ
(11-07-2017 11:56 AM)Attackcoog Wrote:  
(11-07-2017 11:29 AM)Frank the Tank Wrote:  The one thing that sports will always have as an advantage over virtually every other form of entertainment is that people watch them live, which means they are long going to be the most desirable type of programming for advertisers. There's also long-term predictability where you can be reasonably certain that people will still watch the NFL/NBA/MLB/P5 in 10 years, whereas even the most popular scripted TV shows eventually run out of steam. Those factors inherently raise the price of sports.

Also, ESPN and other sports networks may need to change their distribution models. However, I'm always perplexed by the arguments that they've paid too much for the NFL/NBA/etc. Those long-term sports contracts might be expensive on paper, but they're also the only things that will keep ESPN and other sports networks *alive* compared to every other cable network. If you really want to see dead sports networks, it will be if Amazon/Google/Netflix/Apple get exclusive NFL and other marquee sports rights. A lot of observers are "undervaluing the value" of keeping those rights out of the hands of those tech companies for the foreseeable future. In essence, there are a lot of short-term expenses with these sports contracts, but that's really the other way that they can survive in the long-term. I'll never understand the thinking that sports networks can survive by showing less sports. That's foolish short-term stock price thinking in a world where content will always be king. The only thing that costs more for ESPN than the NFL is the cost of *not* having the NFL.


Ive said it multiple times. The biggest threat to ESPN as a major power in broadcasting is not cord cutting. The biggest threat to ESPN is that sports leagues will eventually decide to retain their broadcast rights and use a direct to consumer streaming model to maximize profits. That would set ESPN back abut 30 years to a time when they had nothing but Sportscenter and Lumberjack competitions. ESPN will pay to aggressively fight to retain those rights packages in anyway they can because without those live sports rights, ESPN doesnt survive.

The advantage that ESPN has to combat this risk is that is already has the agreements in place with cable and satellite companies to collect the cost of the rights fees for the NFL, NBA and MLB. They have just demonstrated their leverage again in recent negotiations with Altice, whose predecessor Cablevision was notoriously one of the most difficult cable systems to deal with. It would be a huge risk for any of these leagues to walk away from a revenue stream that ESPN has already negotiated in hopes of doing better.
(This post was last modified: 11-07-2017 12:18 PM by orangefan.)
11-07-2017 12:17 PM
Find all posts by this user Quote this message in a reply

Attackcoog Online
Moderator
*

Posts: 24,390
Joined: Oct 2011
Reputation: 945
I Root For: Houston
Location:
Post: #7
RE: Twelve Ways Sports Networks Will Adapt To Evolving Marketplace--SBJ
(11-07-2017 12:17 PM)orangefan Wrote:  
(11-07-2017 11:56 AM)Attackcoog Wrote:  
(11-07-2017 11:29 AM)Frank the Tank Wrote:  The one thing that sports will always have as an advantage over virtually every other form of entertainment is that people watch them live, which means they are long going to be the most desirable type of programming for advertisers. There's also long-term predictability where you can be reasonably certain that people will still watch the NFL/NBA/MLB/P5 in 10 years, whereas even the most popular scripted TV shows eventually run out of steam. Those factors inherently raise the price of sports.

Also, ESPN and other sports networks may need to change their distribution models. However, I'm always perplexed by the arguments that they've paid too much for the NFL/NBA/etc. Those long-term sports contracts might be expensive on paper, but they're also the only things that will keep ESPN and other sports networks *alive* compared to every other cable network. If you really want to see dead sports networks, it will be if Amazon/Google/Netflix/Apple get exclusive NFL and other marquee sports rights. A lot of observers are "undervaluing the value" of keeping those rights out of the hands of those tech companies for the foreseeable future. In essence, there are a lot of short-term expenses with these sports contracts, but that's really the other way that they can survive in the long-term. I'll never understand the thinking that sports networks can survive by showing less sports. That's foolish short-term stock price thinking in a world where content will always be king. The only thing that costs more for ESPN than the NFL is the cost of *not* having the NFL.


Ive said it multiple times. The biggest threat to ESPN as a major power in broadcasting is not cord cutting. The biggest threat to ESPN is that sports leagues will eventually decide to retain their broadcast rights and use a direct to consumer streaming model to maximize profits. That would set ESPN back abut 30 years to a time when they had nothing but Sportscenter and Lumberjack competitions. ESPN will pay to aggressively fight to retain those rights packages in anyway they can because without those live sports rights, ESPN doesnt survive.

The advantage that ESPN has to combat this risk is that is already has the agreements in place with cable and satellite companies to collect the cost of the rights fees for the NFL, NBA and MLB. They have just demonstrated their leverage again in recent negotiations with Altice, whose predecessor Cablevision was notoriously one of the most difficult cable systems to deal with. It would be a huge risk for any of these leagues to walk away from a revenue stream that ESPN has already negotiated in hopes of doing better.

For now the current P5 deals with networks is the better path. However, understand---the direct to consumer model avoids dealing with cable carriers completely. You dont need them. So having deals with cable companies isnt necessary. In fact, with the direct to consumer model, you may find that the cable companies might come knocking on YOUR door.

As for the the direct to consumer model---self production is already happening at lower levels at very low costs. As the ability to produce good looking streams with relatively low cost equipment/facilities/staffing increases, the lure of a direct to consumer model will increase. This will be accelerated if the rights fees broadcasters seek to pay less for leagues in the future. It may be that the threat of the direct to consumer model is what leagues will use to keep rights fee's high. Its like having a competing bidder in your back pocket in every negotiation.

Here is whats interesting. I could see G5 conferences being more likely to use the direct to consumer model as they are pretty much low balled by broadcasters. Thier far more likely to come out ahead that way. P5 conferences would be the least likely to use it anytime soon because they receive lucrative deals from the networks. However, if the P5 eventually see enough extra profit in going to the direct to consumer model--then the G5 would probably STOP using the direct to consumer model as they would finally be in a position to receive legitimate market value deals from the networks who would be in dire need of live FBS programming.
(This post was last modified: 11-07-2017 12:55 PM by Attackcoog.)
11-07-2017 12:40 PM
Find all posts by this user Quote this message in a reply
arkstfan Away
Sorry folks
*

Posts: 21,397
Joined: Feb 2004
Reputation: 616
I Root For: Fresh Starts
Location:
Post: #8
RE: Twelve Ways Sports Networks Will Adapt To Evolving Marketplace--SBJ
(11-07-2017 11:56 AM)Attackcoog Wrote:  
(11-07-2017 11:29 AM)Frank the Tank Wrote:  The one thing that sports will always have as an advantage over virtually every other form of entertainment is that people watch them live, which means they are long going to be the most desirable type of programming for advertisers. There's also long-term predictability where you can be reasonably certain that people will still watch the NFL/NBA/MLB/P5 in 10 years, whereas even the most popular scripted TV shows eventually run out of steam. Those factors inherently raise the price of sports.

Also, ESPN and other sports networks may need to change their distribution models. However, I'm always perplexed by the arguments that they've paid too much for the NFL/NBA/etc. Those long-term sports contracts might be expensive on paper, but they're also the only things that will keep ESPN and other sports networks *alive* compared to every other cable network. If you really want to see dead sports networks, it will be if Amazon/Google/Netflix/Apple get exclusive NFL and other marquee sports rights. A lot of observers are "undervaluing the value" of keeping those rights out of the hands of those tech companies for the foreseeable future. In essence, there are a lot of short-term expenses with these sports contracts, but that's really the other way that they can survive in the long-term. I'll never understand the thinking that sports networks can survive by showing less sports. That's foolish short-term stock price thinking in a world where content will always be king. The only thing that costs more for ESPN than the NFL is the cost of *not* having the NFL.


Ive said it multiple times. The biggest threat to ESPN as a major power in broadcasting is not cord cutting. The biggest threat to ESPN is that sports leagues will eventually decide to retain their broadcast rights and use a direct to consumer streaming model to maximize profits. That would set ESPN back abut 30 years to a time when they had nothing but Sportscenter and Lumberjack competitions. ESPN will pay to aggressively fight to retain those rights packages in anyway they can because without those live sports rights, ESPN doesnt survive.

I don't think the major properties are going to be terribly inclined to go into the broadcast business for their most valuable content.

If they do they get all the gain but they assume all the risk.

Much easier to sit back and let the four OTA networks, FS1, ESPN, and maybe other players like Amazon, Google, Apple, Facebook, Twitter, Netflix bid against each other and assume the risk.
11-07-2017 03:16 PM
Find all posts by this user Quote this message in a reply
Attackcoog Online
Moderator
*

Posts: 24,390
Joined: Oct 2011
Reputation: 945
I Root For: Houston
Location:
Post: #9
RE: Twelve Ways Sports Networks Will Adapt To Evolving Marketplace--SBJ
(11-07-2017 03:16 PM)arkstfan Wrote:  
(11-07-2017 11:56 AM)Attackcoog Wrote:  
(11-07-2017 11:29 AM)Frank the Tank Wrote:  The one thing that sports will always have as an advantage over virtually every other form of entertainment is that people watch them live, which means they are long going to be the most desirable type of programming for advertisers. There's also long-term predictability where you can be reasonably certain that people will still watch the NFL/NBA/MLB/P5 in 10 years, whereas even the most popular scripted TV shows eventually run out of steam. Those factors inherently raise the price of sports.

Also, ESPN and other sports networks may need to change their distribution models. However, I'm always perplexed by the arguments that they've paid too much for the NFL/NBA/etc. Those long-term sports contracts might be expensive on paper, but they're also the only things that will keep ESPN and other sports networks *alive* compared to every other cable network. If you really want to see dead sports networks, it will be if Amazon/Google/Netflix/Apple get exclusive NFL and other marquee sports rights. A lot of observers are "undervaluing the value" of keeping those rights out of the hands of those tech companies for the foreseeable future. In essence, there are a lot of short-term expenses with these sports contracts, but that's really the other way that they can survive in the long-term. I'll never understand the thinking that sports networks can survive by showing less sports. That's foolish short-term stock price thinking in a world where content will always be king. The only thing that costs more for ESPN than the NFL is the cost of *not* having the NFL.


Ive said it multiple times. The biggest threat to ESPN as a major power in broadcasting is not cord cutting. The biggest threat to ESPN is that sports leagues will eventually decide to retain their broadcast rights and use a direct to consumer streaming model to maximize profits. That would set ESPN back abut 30 years to a time when they had nothing but Sportscenter and Lumberjack competitions. ESPN will pay to aggressively fight to retain those rights packages in anyway they can because without those live sports rights, ESPN doesnt survive.

I don't think the major properties are going to be terribly inclined to go into the broadcast business for their most valuable content.

If they do they get all the gain but they assume all the risk.

Much easier to sit back and let the four OTA networks, FS1, ESPN, and maybe other players like Amazon, Google, Apple, Facebook, Twitter, Netflix bid against each other and assume the risk.

What level of risk really exists? Almost every school already self produces content for olympic sports. If you control productions costs, you control the level of risk. That said, few groups of administrators are more risk averse than university presidents. So, you could be right.
11-07-2017 03:35 PM
Find all posts by this user Quote this message in a reply
arkstfan Away
Sorry folks
*

Posts: 21,397
Joined: Feb 2004
Reputation: 616
I Root For: Fresh Starts
Location:
Post: #10
RE: Twelve Ways Sports Networks Will Adapt To Evolving Marketplace--SBJ
(11-07-2017 03:35 PM)Attackcoog Wrote:  
(11-07-2017 03:16 PM)arkstfan Wrote:  
(11-07-2017 11:56 AM)Attackcoog Wrote:  
(11-07-2017 11:29 AM)Frank the Tank Wrote:  The one thing that sports will always have as an advantage over virtually every other form of entertainment is that people watch them live, which means they are long going to be the most desirable type of programming for advertisers. There's also long-term predictability where you can be reasonably certain that people will still watch the NFL/NBA/MLB/P5 in 10 years, whereas even the most popular scripted TV shows eventually run out of steam. Those factors inherently raise the price of sports.

Also, ESPN and other sports networks may need to change their distribution models. However, I'm always perplexed by the arguments that they've paid too much for the NFL/NBA/etc. Those long-term sports contracts might be expensive on paper, but they're also the only things that will keep ESPN and other sports networks *alive* compared to every other cable network. If you really want to see dead sports networks, it will be if Amazon/Google/Netflix/Apple get exclusive NFL and other marquee sports rights. A lot of observers are "undervaluing the value" of keeping those rights out of the hands of those tech companies for the foreseeable future. In essence, there are a lot of short-term expenses with these sports contracts, but that's really the other way that they can survive in the long-term. I'll never understand the thinking that sports networks can survive by showing less sports. That's foolish short-term stock price thinking in a world where content will always be king. The only thing that costs more for ESPN than the NFL is the cost of *not* having the NFL.


Ive said it multiple times. The biggest threat to ESPN as a major power in broadcasting is not cord cutting. The biggest threat to ESPN is that sports leagues will eventually decide to retain their broadcast rights and use a direct to consumer streaming model to maximize profits. That would set ESPN back abut 30 years to a time when they had nothing but Sportscenter and Lumberjack competitions. ESPN will pay to aggressively fight to retain those rights packages in anyway they can because without those live sports rights, ESPN doesnt survive.

I don't think the major properties are going to be terribly inclined to go into the broadcast business for their most valuable content.

If they do they get all the gain but they assume all the risk.

Much easier to sit back and let the four OTA networks, FS1, ESPN, and maybe other players like Amazon, Google, Apple, Facebook, Twitter, Netflix bid against each other and assume the risk.

What level of risk really exists? Almost every school already self produces content for olympic sports. If you control productions costs, you control the level of risk. That said, few groups of administrators are more risk averse than university presidents. So, you could be right.

The risk that the ad or subscriber market does not reach or stay at projections. Better to have ESPN on the hook for $25 million per school for the next ten years than make $35 million on your own now and $10 million eight years from now.
11-07-2017 04:49 PM
Find all posts by this user Quote this message in a reply
Attackcoog Online
Moderator
*

Posts: 24,390
Joined: Oct 2011
Reputation: 945
I Root For: Houston
Location:
Post: #11
RE: Twelve Ways Sports Networks Will Adapt To Evolving Marketplace--SBJ
(11-07-2017 04:49 PM)arkstfan Wrote:  
(11-07-2017 03:35 PM)Attackcoog Wrote:  
(11-07-2017 03:16 PM)arkstfan Wrote:  
(11-07-2017 11:56 AM)Attackcoog Wrote:  
(11-07-2017 11:29 AM)Frank the Tank Wrote:  The one thing that sports will always have as an advantage over virtually every other form of entertainment is that people watch them live, which means they are long going to be the most desirable type of programming for advertisers. There's also long-term predictability where you can be reasonably certain that people will still watch the NFL/NBA/MLB/P5 in 10 years, whereas even the most popular scripted TV shows eventually run out of steam. Those factors inherently raise the price of sports.

Also, ESPN and other sports networks may need to change their distribution models. However, I'm always perplexed by the arguments that they've paid too much for the NFL/NBA/etc. Those long-term sports contracts might be expensive on paper, but they're also the only things that will keep ESPN and other sports networks *alive* compared to every other cable network. If you really want to see dead sports networks, it will be if Amazon/Google/Netflix/Apple get exclusive NFL and other marquee sports rights. A lot of observers are "undervaluing the value" of keeping those rights out of the hands of those tech companies for the foreseeable future. In essence, there are a lot of short-term expenses with these sports contracts, but that's really the other way that they can survive in the long-term. I'll never understand the thinking that sports networks can survive by showing less sports. That's foolish short-term stock price thinking in a world where content will always be king. The only thing that costs more for ESPN than the NFL is the cost of *not* having the NFL.


Ive said it multiple times. The biggest threat to ESPN as a major power in broadcasting is not cord cutting. The biggest threat to ESPN is that sports leagues will eventually decide to retain their broadcast rights and use a direct to consumer streaming model to maximize profits. That would set ESPN back abut 30 years to a time when they had nothing but Sportscenter and Lumberjack competitions. ESPN will pay to aggressively fight to retain those rights packages in anyway they can because without those live sports rights, ESPN doesnt survive.

I don't think the major properties are going to be terribly inclined to go into the broadcast business for their most valuable content.

If they do they get all the gain but they assume all the risk.

Much easier to sit back and let the four OTA networks, FS1, ESPN, and maybe other players like Amazon, Google, Apple, Facebook, Twitter, Netflix bid against each other and assume the risk.

What level of risk really exists? Almost every school already self produces content for olympic sports. If you control productions costs, you control the level of risk. That said, few groups of administrators are more risk averse than university presidents. So, you could be right.

The risk that the ad or subscriber market does not reach or stay at projections. Better to have ESPN on the hook for $25 million per school for the next ten years than make $35 million on your own now and $10 million eight years from now.

Of course, if the projections are that far off, ESPN probably is probably bankrupt and no longer paying you. There is always risk. Frankly, I think the real risk with the direct to consumer model is long term. With the direct to consumer model, you probably aren't churning out new t-shirt fans at the same rate as you might if the school was on free TV all the time. If you're in a conference with few cable TV windows as it is---that may not make much difference at all. If you are a P5 school with tons of high exposure windows---it probably makes a huge difference.
(This post was last modified: 11-07-2017 05:48 PM by Attackcoog.)
11-07-2017 05:42 PM
Find all posts by this user Quote this message in a reply

orangefan Offline
All American
*

Posts: 3,978
Joined: Mar 2007
Reputation: 195
I Root For: Syracuse
Location: New England
Post: #12
RE: Twelve Ways Sports Networks Will Adapt To Evolving Marketplace--SBJ
(11-07-2017 05:42 PM)Attackcoog Wrote:  
(11-07-2017 04:49 PM)arkstfan Wrote:  
(11-07-2017 03:35 PM)Attackcoog Wrote:  
(11-07-2017 03:16 PM)arkstfan Wrote:  
(11-07-2017 11:56 AM)Attackcoog Wrote:  Ive said it multiple times. The biggest threat to ESPN as a major power in broadcasting is not cord cutting. The biggest threat to ESPN is that sports leagues will eventually decide to retain their broadcast rights and use a direct to consumer streaming model to maximize profits. That would set ESPN back abut 30 years to a time when they had nothing but Sportscenter and Lumberjack competitions. ESPN will pay to aggressively fight to retain those rights packages in anyway they can because without those live sports rights, ESPN doesnt survive.

I don't think the major properties are going to be terribly inclined to go into the broadcast business for their most valuable content.

If they do they get all the gain but they assume all the risk.

Much easier to sit back and let the four OTA networks, FS1, ESPN, and maybe other players like Amazon, Google, Apple, Facebook, Twitter, Netflix bid against each other and assume the risk.

What level of risk really exists? Almost every school already self produces content for olympic sports. If you control productions costs, you control the level of risk. That said, few groups of administrators are more risk averse than university presidents. So, you could be right.

The risk that the ad or subscriber market does not reach or stay at projections. Better to have ESPN on the hook for $25 million per school for the next ten years than make $35 million on your own now and $10 million eight years from now.

Of course, if the projections are that far off, ESPN probably is probably bankrupt and no longer paying you. There is always risk. Frankly, I think the real risk with the direct to consumer model is long term. With the direct to consumer model, you probably aren't churning out new t-shirt fans at the same rate as you might if the school was on free TV all the time. If you're in a conference with few cable TV windows as it is---that may not make much difference at all. If you are a P5 school with tons of high exposure windows---it probably makes a huge difference.

Despite all of the handwringing, ESPN remains wildly profitable. For 9 monthsa ended June, 2017 Disney’s cable networks division made $4 billion in profits on $12 billion in revenues. https://ditm-twdc-us.storage.googleapis....rnings.pdf FY2017 earnings to be released this Thursday. It’s problem is that the seemingly neverending annual growth in profits that it had been providing to Disney did end and ESPN has entered the maturity phase of its business life cycle. It has plenty of money to pay its rights fee commitments.
(This post was last modified: 11-08-2017 09:50 AM by orangefan.)
11-07-2017 06:11 PM
Find all posts by this user Quote this message in a reply
ColKurtz Offline
Bench Warmer
*

Posts: 150
Joined: Aug 2016
Reputation: 22
I Root For: Virginia Tech
Location: Raleigh
Post: #13
RE: Twelve Ways Sports Networks Will Adapt To Evolving Marketplace--SBJ
(11-07-2017 03:35 PM)Attackcoog Wrote:  What level of risk really exists? Almost every school already self produces content for olympic sports. If you control productions costs, you control the level of risk. That said, few groups of administrators are more risk averse than university presidents. So, you could be right.

I think the biggest risk here is balkanization. If I'm a cord cutter paying $20-30/month for Netflix, maybe that much again for Disnyflix, how much more am I going to spend for sports? If each conference is going direct to consumer, how many comference subscriptions am I going to sign up for. Most college football fans I know are fans of college football as a whole, not just the conference their team is in. You may end up pricing yourself out of even diehard fans. If the cost of a couple of movie/tv streaming services, plus 5 conference packages, NFL(?), ends up costing me $120/month, why is that better than getting everything one cable bill? Great for people who don't watch sports, but I see revenue tanking at least for some conferences (looking at you Pac12).
11-07-2017 09:53 PM
Find all posts by this user Quote this message in a reply
Attackcoog Online
Moderator
*

Posts: 24,390
Joined: Oct 2011
Reputation: 945
I Root For: Houston
Location:
Post: #14
RE: Twelve Ways Sports Networks Will Adapt To Evolving Marketplace--SBJ
(11-07-2017 09:53 PM)ColKurtz Wrote:  
(11-07-2017 03:35 PM)Attackcoog Wrote:  What level of risk really exists? Almost every school already self produces content for olympic sports. If you control productions costs, you control the level of risk. That said, few groups of administrators are more risk averse than university presidents. So, you could be right.

I think the biggest risk here is balkanization. If I'm a cord cutter paying $20-30/month for Netflix, maybe that much again for Disnyflix, how much more am I going to spend for sports? If each conference is going direct to consumer, how many comference subscriptions am I going to sign up for. Most college football fans I know are fans of college football as a whole, not just the conference their team is in. You may end up pricing yourself out of even diehard fans. If the cost of a couple of movie/tv streaming services, plus 5 conference packages, NFL(?), ends up costing me $120/month, why is that better than getting everything one cable bill? Great for people who don't watch sports, but I see revenue tanking at least for some conferences (looking at you Pac12).

Yeah. I think it could potentially be horrible for fans--especially if the direct to consumer model goes down to school level.
(This post was last modified: 11-08-2017 12:13 AM by Attackcoog.)
11-08-2017 12:11 AM
Find all posts by this user Quote this message in a reply
arkstfan Away
Sorry folks
*

Posts: 21,397
Joined: Feb 2004
Reputation: 616
I Root For: Fresh Starts
Location:
Post: #15
RE: Twelve Ways Sports Networks Will Adapt To Evolving Marketplace--SBJ
(11-07-2017 05:42 PM)Attackcoog Wrote:  
(11-07-2017 04:49 PM)arkstfan Wrote:  
(11-07-2017 03:35 PM)Attackcoog Wrote:  
(11-07-2017 03:16 PM)arkstfan Wrote:  
(11-07-2017 11:56 AM)Attackcoog Wrote:  Ive said it multiple times. The biggest threat to ESPN as a major power in broadcasting is not cord cutting. The biggest threat to ESPN is that sports leagues will eventually decide to retain their broadcast rights and use a direct to consumer streaming model to maximize profits. That would set ESPN back abut 30 years to a time when they had nothing but Sportscenter and Lumberjack competitions. ESPN will pay to aggressively fight to retain those rights packages in anyway they can because without those live sports rights, ESPN doesnt survive.

I don't think the major properties are going to be terribly inclined to go into the broadcast business for their most valuable content.

If they do they get all the gain but they assume all the risk.

Much easier to sit back and let the four OTA networks, FS1, ESPN, and maybe other players like Amazon, Google, Apple, Facebook, Twitter, Netflix bid against each other and assume the risk.

What level of risk really exists? Almost every school already self produces content for olympic sports. If you control productions costs, you control the level of risk. That said, few groups of administrators are more risk averse than university presidents. So, you could be right.

The risk that the ad or subscriber market does not reach or stay at projections. Better to have ESPN on the hook for $25 million per school for the next ten years than make $35 million on your own now and $10 million eight years from now.

Of course, if the projections are that far off, ESPN probably is probably bankrupt and no longer paying you. There is always risk. Frankly, I think the real risk with the direct to consumer model is long term. With the direct to consumer model, you probably aren't churning out new t-shirt fans at the same rate as you might if the school was on free TV all the time. If you're in a conference with few cable TV windows as it is---that may not make much difference at all. If you are a P5 school with tons of high exposure windows---it probably makes a huge difference.

If ESPN is bankrupt and can't pay that means Disney can't pay. If liquidation of the Disney assets can't get you paid, you have far bigger problems than getting paid by your TV licensee.
11-08-2017 09:33 AM
Find all posts by this user Quote this message in a reply
arkstfan Away
Sorry folks
*

Posts: 21,397
Joined: Feb 2004
Reputation: 616
I Root For: Fresh Starts
Location:
Post: #16
RE: Twelve Ways Sports Networks Will Adapt To Evolving Marketplace--SBJ
(11-07-2017 09:53 PM)ColKurtz Wrote:  
(11-07-2017 03:35 PM)Attackcoog Wrote:  What level of risk really exists? Almost every school already self produces content for olympic sports. If you control productions costs, you control the level of risk. That said, few groups of administrators are more risk averse than university presidents. So, you could be right.

I think the biggest risk here is balkanization. If I'm a cord cutter paying $20-30/month for Netflix, maybe that much again for Disnyflix, how much more am I going to spend for sports? If each conference is going direct to consumer, how many comference subscriptions am I going to sign up for. Most college football fans I know are fans of college football as a whole, not just the conference their team is in. You may end up pricing yourself out of even diehard fans. If the cost of a couple of movie/tv streaming services, plus 5 conference packages, NFL(?), ends up costing me $120/month, why is that better than getting everything one cable bill? Great for people who don't watch sports, but I see revenue tanking at least for some conferences (looking at you Pac12).

Right now you have schools like Arkansas State and Georgia Southern (and there are three more in the Sun Belt I cannot recall, Louisiana Lafayette and App I think are on the list, maybe Ga State as well) who have purchased the production equipment required and consider getting added events distributed by ESPN3 to be a marketing expense. They will produce some men's and women's basketball games, volleyball, soccer, baseball and softball games that aren't carried by the league deal and distribute on ESPN3 directly.

If sports distribution takes the Balkans model and you pay by conference or school those schools are going to go sell a few ads to mitigate costs and someone whether it is ESPN3, Twitter, Facebook, Google, Snapchat, Amazon, Hulu, Netflix or whatever remains of Yahoo! will redistribute and either insert ads or do layover ads.

If you are making less from TV than you make for buy game or a well attended home game, TV is not really a revenue stream, it's a marketing venture.

They may never draw much of an audience but they will be part of the free component of sports telecasts.
11-08-2017 09:46 AM
Find all posts by this user Quote this message in a reply

MissouriStateBears Offline
All American
*

Posts: 3,227
Joined: Jul 2005
Reputation: 74
I Root For: Missouri State
Location:
Post: #17
RE: Twelve Ways Sports Networks Will Adapt To Evolving Marketplace--SBJ
(11-08-2017 09:46 AM)arkstfan Wrote:  
(11-07-2017 09:53 PM)ColKurtz Wrote:  
(11-07-2017 03:35 PM)Attackcoog Wrote:  What level of risk really exists? Almost every school already self produces content for olympic sports. If you control productions costs, you control the level of risk. That said, few groups of administrators are more risk averse than university presidents. So, you could be right.

I think the biggest risk here is balkanization. If I'm a cord cutter paying $20-30/month for Netflix, maybe that much again for Disnyflix, how much more am I going to spend for sports? If each conference is going direct to consumer, how many comference subscriptions am I going to sign up for. Most college football fans I know are fans of college football as a whole, not just the conference their team is in. You may end up pricing yourself out of even diehard fans. If the cost of a couple of movie/tv streaming services, plus 5 conference packages, NFL(?), ends up costing me $120/month, why is that better than getting everything one cable bill? Great for people who don't watch sports, but I see revenue tanking at least for some conferences (looking at you Pac12).

Right now you have schools like Arkansas State and Georgia Southern (and there are three more in the Sun Belt I cannot recall, Louisiana Lafayette and App I think are on the list, maybe Ga State as well) who have purchased the production equipment required and consider getting added events distributed by ESPN3 to be a marketing expense. They will produce some men's and women's basketball games, volleyball, soccer, baseball and softball games that aren't carried by the league deal and distribute on ESPN3 directly.

If sports distribution takes the Balkans model and you pay by conference or school those schools are going to go sell a few ads to mitigate costs and someone whether it is ESPN3, Twitter, Facebook, Google, Snapchat, Amazon, Hulu, Netflix or whatever remains of Yahoo! will redistribute and either insert ads or do layover ads.

If you are making less from TV than you make for buy game or a well attended home game, TV is not really a revenue stream, it's a marketing venture.

They may never draw much of an audience but they will be part of the free component of sports telecasts.

How is the production value on those conference games done in house? Several of the Valley schools on ESPN3 productions are unwatchable, just horrible that I just would rather listen to the radio broadcast.
11-08-2017 10:59 AM
Find all posts by this user Quote this message in a reply
arkstfan Away
Sorry folks
*

Posts: 21,397
Joined: Feb 2004
Reputation: 616
I Root For: Fresh Starts
Location:
Post: #18
RE: Twelve Ways Sports Networks Will Adapt To Evolving Marketplace--SBJ
(11-08-2017 10:59 AM)MissouriStateBears Wrote:  
(11-08-2017 09:46 AM)arkstfan Wrote:  
(11-07-2017 09:53 PM)ColKurtz Wrote:  
(11-07-2017 03:35 PM)Attackcoog Wrote:  What level of risk really exists? Almost every school already self produces content for olympic sports. If you control productions costs, you control the level of risk. That said, few groups of administrators are more risk averse than university presidents. So, you could be right.

I think the biggest risk here is balkanization. If I'm a cord cutter paying $20-30/month for Netflix, maybe that much again for Disnyflix, how much more am I going to spend for sports? If each conference is going direct to consumer, how many comference subscriptions am I going to sign up for. Most college football fans I know are fans of college football as a whole, not just the conference their team is in. You may end up pricing yourself out of even diehard fans. If the cost of a couple of movie/tv streaming services, plus 5 conference packages, NFL(?), ends up costing me $120/month, why is that better than getting everything one cable bill? Great for people who don't watch sports, but I see revenue tanking at least for some conferences (looking at you Pac12).

Right now you have schools like Arkansas State and Georgia Southern (and there are three more in the Sun Belt I cannot recall, Louisiana Lafayette and App I think are on the list, maybe Ga State as well) who have purchased the production equipment required and consider getting added events distributed by ESPN3 to be a marketing expense. They will produce some men's and women's basketball games, volleyball, soccer, baseball and softball games that aren't carried by the league deal and distribute on ESPN3 directly.

If sports distribution takes the Balkans model and you pay by conference or school those schools are going to go sell a few ads to mitigate costs and someone whether it is ESPN3, Twitter, Facebook, Google, Snapchat, Amazon, Hulu, Netflix or whatever remains of Yahoo! will redistribute and either insert ads or do layover ads.

If you are making less from TV than you make for buy game or a well attended home game, TV is not really a revenue stream, it's a marketing venture.

They may never draw much of an audience but they will be part of the free component of sports telecasts.

How is the production value on those conference games done in house? Several of the Valley schools on ESPN3 productions are unwatchable, just horrible that I just would rather listen to the radio broadcast.

I've only seen AState men's hoops and I'm not sure if the volleyball game I watched was part of the ESPN deal or App State did it, I suspect App did it based on quality.

The AState hoops looks like any run of the mill ESPN3 or CBS Sports Net production. Announcing, the play-by-play is homerish, color commentator better than most of the end of the bench ESPN crew but he used to work for ESPN Regional until he got tired of the travel.

The volleyball was acceptable, the director almost never showed the A-State plays celebrating winning a point, the A-State coach might not have been there for all I could tell.

The past several years, A-State's best in-house production students have been hired by ESPN to supplement the broadcast team for the Liberty Bowl so the standard is high.
11-08-2017 11:41 AM
Find all posts by this user Quote this message in a reply
Attackcoog Online
Moderator
*

Posts: 24,390
Joined: Oct 2011
Reputation: 945
I Root For: Houston
Location:
Post: #19
RE: Twelve Ways Sports Networks Will Adapt To Evolving Marketplace--SBJ
(11-08-2017 09:33 AM)arkstfan Wrote:  
(11-07-2017 05:42 PM)Attackcoog Wrote:  
(11-07-2017 04:49 PM)arkstfan Wrote:  
(11-07-2017 03:35 PM)Attackcoog Wrote:  
(11-07-2017 03:16 PM)arkstfan Wrote:  I don't think the major properties are going to be terribly inclined to go into the broadcast business for their most valuable content.

If they do they get all the gain but they assume all the risk.

Much easier to sit back and let the four OTA networks, FS1, ESPN, and maybe other players like Amazon, Google, Apple, Facebook, Twitter, Netflix bid against each other and assume the risk.

What level of risk really exists? Almost every school already self produces content for olympic sports. If you control productions costs, you control the level of risk. That said, few groups of administrators are more risk averse than university presidents. So, you could be right.

The risk that the ad or subscriber market does not reach or stay at projections. Better to have ESPN on the hook for $25 million per school for the next ten years than make $35 million on your own now and $10 million eight years from now.

Of course, if the projections are that far off, ESPN probably is probably bankrupt and no longer paying you. There is always risk. Frankly, I think the real risk with the direct to consumer model is long term. With the direct to consumer model, you probably aren't churning out new t-shirt fans at the same rate as you might if the school was on free TV all the time. If you're in a conference with few cable TV windows as it is---that may not make much difference at all. If you are a P5 school with tons of high exposure windows---it probably makes a huge difference.

If ESPN is bankrupt and can't pay that means Disney can't pay. If liquidation of the Disney assets can't get you paid, you have far bigger problems than getting paid by your TV licensee.

Not really certain what the structure is, but I believe ESPN is likely structured as a separate corporate entity that is owned by Disney. If ESPN went bankrupt, wouldn’t it be self contained? ESPN declares bankruptcy—wouldn’t only ESPN assets be part of the bankruptcy? Frankly, I know it works that way for individuals who own corporations, I’m not exactly sure how the corporate shield works for a corporation that owns another corporation.
(This post was last modified: 11-08-2017 12:10 PM by Attackcoog.)
11-08-2017 12:06 PM
Find all posts by this user Quote this message in a reply
johnbragg Offline
Moderator
*

Posts: 8,898
Joined: Dec 2011
Reputation: 290
I Root For: St Johns
Location:
Post: #20
RE: Twelve Ways Sports Networks Will Adapt To Evolving Marketplace--SBJ
(11-08-2017 12:06 PM)Attackcoog Wrote:  Not really certain what the structure is, but I believe ESPN is likely structured as a separate corporate entity that is owned by Disney. If ESPN went bankrupt, wouldn’t it be self contained? ESPN declares bankruptcy—wouldn’t only ESPN assets be part of the bankruptcy? Frankly, I know it works that way for individuals who own corporations, I’m not exactly sure how the corporate shield works for a corporation that owns another corporation.

Depends whether the contracts were with ESPN Inc or with Disney, or some subset of the Disney empire.
11-08-2017 03:07 PM
Find all posts by this user Quote this message in a reply
Post Reply 




User(s) browsing this thread: 1 Guest(s)


Copyright © 2002-2018 Collegiate Sports Nation Bulletin Board System (CSNbbs), All Rights Reserved.
CSNbbs is an independent fan site and is in no way affiliated to the NCAA or any of the schools and conferences it represents.
This site monetizes links. FTC Disclosure.
We allow third-party companies to serve ads and/or collect certain anonymous information when you visit our web site. These companies may use non-personally identifiable information (e.g., click stream information, browser type, time and date, subject of advertisements clicked or scrolled over) during your visits to this and other Web sites in order to provide advertisements about goods and services likely to be of greater interest to you. These companies typically use a cookie or third party web beacon to collect this information. To learn more about this behavioral advertising practice or to opt-out of this type of advertising, you can visit http://www.networkadvertising.org.
Powered By MyBB, © 2002-2018 MyBB Group.