At what point will ESPN and other sports nets feel the effects of cord cutting?

[nomadcowatbk]

Probably not for the next decade at least, but eventually there won't be enough non-sports fans subscribing to cable to generate large profits from subscriber fees? Could ESPN go premium like HBO or will sports just go to pay per view for individual games? Should the leagues be concerned since cord cutters tend to be younger

 

[Morgan Wick]

I don't think cord-cutting is going to be a problem in the near or even medium term. A la carte, in the form of the sports-free packages some cable companies are already starting to offer, will get them long before that, even if the cable companies are successful in the short term at fending off actual a la carte.

If the distribution of ESPN or FS1 dips below, let's say 60%, it's going to be difficult for big-time teams and leagues to continue to justify treating either one as "good enough" for the biggest events either network has. I don't think most teams and leagues will be willing to settle for being on a premium channel or pay-per-view, or you'd see a lot more sports on HBO or Showtime. No sport wants to go down the road boxing took. That'll cause a feedback loop where the decline in major sports on ESPN lowers the value of the sports package, so more people leave and/or ESPN has less money to throw around.

I actually think sports could be a cause of cord-cutting; if teams and leagues make a full-scale return to broadcast, it becomes a lot easier for sports fans to cut the cord, and right now sports might be the single biggest obstacle to it.

 

[TheBigA]

The real problem for ESPN isn't a lack of paying customers, but the growth and expansion of sports TV networks. In just the last year, NBC and CBS entered the game. Turner has been very competitive with rights fees for baseball and NCAA basketball. These competitors will put pressure on cable companies to increase THEIR fees too so they can compete against ESPN for other events, with the goal to drive down ESPN's fees. The way to do this is come up with more events that people want to see. I bet that NBC and CBS have ways of getting those events on their channels instead of ESPPN. Imagine if there'd been an NBC Sports Network 2 years ago when they lost Wimbledon to ESPN.

More and more popular shows will migrate to pay TV. As it is, most of the award-winning dramas are on HBO and Showtime. Companies know they have two revenue streams in cable, while OTA only provides one. Cord cutters will find themselves out in the cold at some point. There will be little left on free OTA TV except infomercials and repeats. Even PBS will realize the opportunities. There is no law that requires these companies to lose money.

 

[nomadcowatbk]

I don't think cord-cutting is going to be a problem in the near or even medium term. A la carte, in the form of the sports-free packages some cable companies are already starting to offer, will get them long before that, even if the cable companies are successful in the short term at fending off actual a la carte.

If the distribution of ESPN or FS1 dips below, let's say 60%, it's going to be difficult for big-time teams and leagues to continue to justify treating either one as "good enough" for the biggest events either network has. I don't think most teams and leagues will be willing to settle for being on a premium channel or pay-per-view, or you'd see a lot more sports on HBO or Showtime. No sport wants to go down the road boxing took. That'll cause a feedback loop where the decline in major sports on ESPN lowers the value of the sports package, so more people leave and/or ESPN has less money to throw around.

I actually think sports could be a cause of cord-cutting; if teams and leagues make a full-scale return to broadcast, it becomes a lot easier for sports fans to cut the cord, and right now sports might be the single biggest obstacle to it.

Shouldn't the leagues put more games up for streaming since there's a growing number of Zero TV households who get their programming exclusively from streaming and those viewers are younger and may not develop an interest in sports like previous generations?

 

[nomadcowatbk]

The real problem for ESPN isn't a lack of paying customers, but the growth and expansion of sports TV networks. In just the last year, NBC and CBS entered the game. Turner has been very competitive with rights fees for baseball and NCAA basketball. These competitors will put pressure on cable companies to increase THEIR fees too so they can compete against ESPN for other events, with the goal to drive down ESPN's fees. The way to do this is come up with more events that people want to see. I bet that NBC and CBS have ways of getting those events on their channels instead of ESPPN. Imagine if there'd been an NBC Sports Network 2 years ago when they lost Wimbledon to ESPN.

More and more popular shows will migrate to pay TV. As it is, most of the award-winning dramas are on HBO and Showtime. Companies know they have two revenue streams in cable, while OTA only provides one. Cord cutters will find themselves out in the cold at some point. There will be little left on free OTA TV except infomercials and repeats. Even PBS will realize the opportunities. There is no law that requires these companies to lose money.

Hulu plus might be considered a dual revenue stream since it still has ads

 

[TheBigA]

Hulu plus might be considered a dual revenue stream since it still has ads

If you're really cutting the cord, that means no Hulu either. Because the companies that own cable also own internet. So if they don't get you in one place, they just get you in another.

 

[nomadcowatbk]

Hulu plus might be considered a dual revenue stream since it still has ads

If you're really cutting the cord, that means no Hulu either. Because the companies that own cable also own internet. So if they don't get you in one place, they just get you in another.

unless you're stealing a neighbors unsecured Wifi signal, and using a friends Hulu plus subscription ;D

 

[TheBigA]

unless you're stealing a neighbors unsecured Wifi signal, and using a friends Hulu plus subscription ;D

That's funny...a new definition for being cheap. I bet people do that too.

 

[FredLeonard]

Cord cutters are not ESPN's viewer base. A lot of cable subscribers (and satellite) signed up for sports in the first place. They are not going to cut the cord unless sports is equally available by some other means. And if it is, you can bet they are still going to have to pay for it.

ESPN will not go premium. No reason to. They already get about $5 per basic subscriber - whether the subscriber ever watches or not, plus ad revenue. If they go premium, only people who actually watch pay and they can't change as much for ad revenue. Besides, the sports leagues would probably not go for restricted access to their games.

Sounds like OP is thinking of cutting the cord, and wants everybody to talk him into it. Or he already has and wants everybody to tell him he did the right thing. Besides, cord cutting only works if you have high speed Internet (to stream video). And who provides that? Same people who provide cable - over the same cord.

 

[nomadcowatbk]

Cord cutters are not ESPN's viewer base. A lot of cable subscribers (and satellite) signed up for sports in the first place. They are not going to cut the cord unless sports is equally available by some other means. And if it is, you can bet they are still going to have to pay for it.

ESPN will not go premium. No reason to. They already get about $5 per basic subscriber - whether the subscriber ever watches or not, plus ad revenue. If they go premium, only people who actually watch pay and they can't change as much for ad revenue. Besides, the sports leagues would probably not go for restricted access to their games.

Sounds like OP is thinking of cutting the cord, and wants everybody to talk him into it. Or he already has and wants everybody to tell him he did the right thing. Besides, cord cutting only works if you have high speed Internet (to stream video). And who provides that? Same people who provide cable - over the same cord.

ESPN is currently able to pay the high prices for its content because it gets the $ from cable subscribers, a lot of cable subscribers don't care about sports and may cut the cord. Eventually, cord cutting might become an epidemic and start to really hurt ESPN. But ESPN's current business model is safe for at least the next decade, but the cord cutters will replace the non-tech savvy cable subscribers who will eventually die or become irrelevant to advertisers. A lot of college students don't even bother to hook up to the free cable connections available in dorm rooms. The big sports leagues may be alienating younger fans by sticking to cable. Their current business model won't last forever. I haven't cut the cord (yet), but I won't really be watching any sports again until football season begins, I have no need for ESPN from Late March-Until September yet I'm still paying for it. I don't expect that to change within the next decade.

 

[TheBigA]

Sonds more like wishful thinking to me.

 

[KeithE4]

Probably not for the next decade at least, but eventually there won't be enough non-sports fans subscribing to cable to generate large profits from subscriber fees? Could ESPN go premium like HBO or will sports just go to pay per view for individual games?

They could, but they won't and they don't have to. Disney is one of those companies that is able to dictate to the cable and satellite providers where they'll be placed on the "dial," and how much they'll charge. Because without ESPN and the other sports providers, the cable & satellite companies will lose a good portion of their subscriber base. People pay for programming, not the connection.

Should the leagues be concerned since cord cutters tend to be younger

The pro leagues already offer online packages (games on the local RSN are blacked out) for a price. Even NFL Sunday Ticket is available online in limited situations. It's college sports that is refusing to follow this model - the radio feeds from most major schools are on the uber-expensive CBS ULive, and TV - especially basketball - is 90% owned by the cable sports networks.

 

[Tiger1983]

I recently cancelled my subscription to Dish Network as of yesterday, and as a result, I will not be able to watch any Steelers games on Monday Night Football or Thursday Night Football(over on NFL Network). I have a Roku, but I don't know if they offer NFL Sunday Ticket app for the device. All I know is that my PS3 is capable of receiving Sunday Ticket stream and also iPad and Android tablets.

Another example is that the Atlanta Falcons won't be on CBS this season, due to inter-conference games being on ESPN and NBC, respectively. Also, all Miami Dolphins road games against NFC teams are both on ESPN. It would be a matter of time before most of the marquee games will eventually move on to cable only as opposed to late-afternoon games on CBS/FOX and Sunday Night Football on NBC.

The ratings on ESPN'S Monday Night Football garnered higher ratings than prime time on CBS and even WWE's Monday Night Raw during NFL season. So this might be the case where the best NFL matchups are ended up scheduled there, as opposed to SNF.

As for the playoff scenario, I do predict that ESPN and NFL network will carry mostly wild-card games for Saturday, then NBC carries two more such games for Sunday. As for the divisional round, NBC will carry the #2 seeded games for each conference while CBS and FOX will show the games whose teams have home field advantage throughout the playoffs. This scenario will be much similar to baseball, where ESPN and TBS mostly carries the divisional rounds, while FOX and TBS carries the LCS rounds.

Give it a couple more years and this above scenario would come true.

 

[w9wi]

Besides, cord cutting only works if you have high speed Internet (to stream video). And who provides that? Same people who provide cable - over the same cord.

But the validity of that statement assumes that you can't get high-speed Internet without also subscribing to the TV service. The fact is that you *can* get high-speed Internet separately, and it *is* significantly less expensive than buying both services. I have only the Internet service from my local cable company, and pay roughly half what I'd pay if I also got my TV that way.

It also assumes that cable, satellite, and Internet streaming are the only ways to receive TV. For most of us, OTA is in fact another option. Sure, there are programs you can't get OTA - but there are plenty of people who find those programs are not worth the $600/year or so you pay for TV service. Especially if they have a Netflix account.

 

[TheBigA]

I have only the Internet service from my local cable company, and pay roughly half what I'd pay if I also got my TV that way.

I think the point is the money is going to the same place. And if one service starts to hurt, they simply raise the price of the other. They're gonna get your money one way or another. You're not going to avoid it.

 

[KeithE4]

I recently cancelled my subscription to Dish Network as of yesterday, and as a result, I will not be able to watch any Steelers games on Monday Night Football or Thursday Night Football(over on NFL Network). I have a Roku, but I don't know if they offer NFL Sunday Ticket app for the device. All I know is that my PS3 is capable of receiving Sunday Ticket stream and also iPad and Android tablets.

NFL Sunday Ticket is not available on the Roku. NBA League Pass, NHL Center Ice, and MLB.TV are.

Another example is that the Atlanta Falcons won't be on CBS this season, due to inter-conference games being on ESPN and NBC, respectively. Also, all Miami Dolphins road games against NFC teams are both on ESPN. It would be a matter of time before most of the marquee games will eventually move on to cable only as opposed to late-afternoon games on CBS/FOX and Sunday Night Football on NBC.

The Monday and Thursday night games are not "marquee." Sunday night is. The NFL flexible scheduling rules for the final few weeks of the season only apply to Sunday late-afternoon CBS/Fox and night NBC games. ESPN's and NFL Network's games are fixed when the schedule comes out in April. They will not change.

The ratings on ESPN'S Monday Night Football garnered higher ratings than prime time on CBS and even WWE's Monday Night Raw during NFL season. So this might be the case where the best NFL matchups are ended up scheduled there, as opposed to SNF.

See above. Monday Night Football is the "second" prime-time game, and has been since it moved from ABC and the Sunday Night game moved from ESPN to NBC. The league considers NBC Sunday Night Football to be the "top-tier" game.

As for the playoff scenario, I do predict that ESPN and NFL network will carry mostly wild-card games for Saturday, then NBC carries two more such games for Sunday. As for the divisional round, NBC will carry the #2 seeded games for each conference while CBS and FOX will show the games whose teams have home field advantage throughout the playoffs. This scenario will be much similar to baseball, where ESPN and TBS mostly carries the divisional rounds, while FOX and TBS carries the LCS rounds.

ESPN and NFL Network are not part of the current playoff picture, although I think ESPN is getting one wild card game with the new deal.

Give it a couple more years and this above scenario would come true.

No, it won't. The new TV contracts begin next year, and the networks will not be changing other than the addition of NBC-owned Telemundo broadcasts of SNF. The new TV deal expires in 2022 (2021 for ESPN).

 

[ansky212]

I have only the Internet service from my local cable company, and pay roughly half what I'd pay if I also got my TV that way.

I think the point is the money is going to the same place. And if one service starts to hurt, they simply raise the price of the other. They're gonna get your money one way or another. You're not going to avoid it.

Exactly. I currently have Verizon FiOS triple play. I recently called to downgrade the TV portion of my service to save some money. They proceeded to tell me that if I did that I would have to rebundle my package. And the internet speed I currently have is no longer offered. So I would have to upgrade to a higher internet speed that just so happens to be more expensive. So the TV price goes down but the internet price then goes up.

 

[Tiger1983]

Here is another possible twist to this puzzle. Every NBA game, including the Finals will be telecasted on ESPN and not ABC.

Or the World Series on either ESPN or TBS?

Would that make sports fans "re-connect" the cord?

 

[KeithE4]

Here is another possible twist to this puzzle. Every NBA game, including the Finals will be telecasted on ESPN and not ABC.

ESPN doesn't have the room for the entire NBA schedule, what with MNF, college football and basketball, and MLB. Besides, Turner might have something to say about that.

Or the World Series on either ESPN or TBS?

You're making stuff up now. Fox has it locked up through 2021.

Would that make sports fans "re-connect" the cord?

After 2021, who knows what will happen? The technology required to deliver content will be even more advanced 8 years from now.

 

[LKellerIII]

I have only the Internet service from my local cable company, and pay roughly half what I'd pay if I also got my TV that way.

I think the point is the money is going to the same place. And if one service starts to hurt, they simply raise the price of the other. They're gonna get your money one way or another. You're not going to avoid it.

Amen. I'm no techie, but from what I understand, the ongoing cost to providers of upgrading the internet infracstructure to handle the ever growing need for bandwidth will cost them billions. They aren't going to do this for free.

Anybody who thinks they will continue to pay $29.95 - $49.95 per month for high-speed internet access is kidding themselves.