The Charter/Disney dispute could break the sports media revenue model
I'm surprised that more people aren't talking about this on here. We all know that money is what has been driving conference expansion/realignment. And this ongoing blackout of ESPN and the other Disney-owned sports channels is a sign that the current business model is breaking down. Charter appears willing to walk away from carrying ESPN and the other Disney channels if Disney will not agree to their terms. They make most of their profit off of broadband internet now, so losing TV subs doesn't really hurt them as much as it would have 20 years ago. If that happens, it will probably cost Disney around $2 Billion per year in lost revenue. It would also set a dangerous precedent that Comcast could follow when their contract with Disney expires.
And all of this will hasten ESPN's shift to a direct-to-consumer streaming model. And I think we'd be looking at paying a minimum of $40 per month for a streaming version of all of ESPN's content. And getting the ACC or SEC Network might be a $5 or $10/month upcharge on top of that.
** Edited by tarheelblue at 9/6/2023, 2:44:13 PM
28 Replies
E
EDGEMAN
2y
At least until Fox's financial house of cards collapses. Will they generate enough viewers to pay those massive fees?
(In response to this post by tarheelblue)
2y
(In response to this post by tarheelblue)
R
ren_hoek
2y
for creating this gosh-awful crappy mess of conference realignment.
(In response to this post by OrlandoHokie)
2y
put ESPN in a sports package, and have basic cable channels without the sports programing. It will end up being the sports consumers (us) that will pay these media deals. There are a LOT of people out there that don't watch sports unless it's for Super Bowl commercials.
grab your wallet, this is about to get expensive.
(In response to this post by tarheelblue)
2y
And only about half of those are "avid" watchers. So Charter might lose around 15%-20% of their TV subs if they decide to abandon carrying the Disney-owned channels. But Charter has been losing lots of TV subs each quarter for years and their profits keep going up. TV subs just aren't very profitable to Charter any more, so they simply don't care that much about losing them. And neither does Comcast. Comcast and Disney have almost become archenemies at this point, so I could see Comcast dropping the Disney-owned channels too when the time comes for contract renewals in a few years.
** Edited by tarheelblue at 9/6/2023, 2:55:51 PM
(In response to this post by Big12 guy)
That makes sense. When I was working in the industry...
My audience measurement models has live sports consumers at 24% and children's programming at 26%.
Those numbers from Charter are likely spot on.
(In response to this post by tarheelblue)
2y
On a regular basis.
And that is why sports programming is so important to them because those viewers might not be regular viewers of their channel and running promos for upcoming shows just might hook those viewers.
(In response to this post by CobbCountyHokie)
Just to put my resume out there...
I was the first on the cable side to report on audience measurement by device.
We could immediately see what each channel was worth to our subs and what programming was being consumed on a minute by minute basis. I was able to recommend to Time Warner (CNN, TBS, TNT, Cartoon, etc) exactly how much audience they would lose at their first and subsequent commercial breaks and where the audience was going...and if they ever returned.
I was able to show how NFL RedZone was the top consumed channel on our second screen devices and I regularly tracked audience measurement for all programming.
So...I may know a thing or two about this stuff.
** Edited by CobbCountyHokie at 9/11/2023, 9:47:18 AM
(In response to this post by CobbCountyHokie)
S
Stech
2y
changing the landscape, if that happens, IMHO, the whole thing would be turned upside down like we have never seen before in our lifetime.
(In response to this post by tarheelblue)
I actually think Apple will become a joint owner of ESPN with Disney
It makes too much sense based on the success Apple is seeing with MLS and Friday baseball. This also moves the ESPN landscape into a better position over the top and less reliant on linear models.
(In response to this post by Stech)
J
jms41
2y
(In response to this post by CobbCountyHokie)
2y
To squeeze the most amount of money out of avid sports fans who really want to watch the game and are willing to pay up for that privilege.
** Edited by tarheelblue at 9/6/2023, 3:12:05 PM
(In response to this post by Stech)
2y
big-time matchups.
(In response to this post by tarheelblue)
2y
The PPV made them money initially, but it just steadily lost people who cared. I realize it is not an exact comparison, but it will have some of the same effects. If they charge too much, people will stop paying and the long term revenues will shrink
(In response to this post by tarheelblue)
E
EDGEMAN
2y
I love watching VT football and BB, but if they went to PPV for every game, I would just listen to it on the radio and watch when it comes out a few days later on YouTube.
(In response to this post by tarheelblue)
Pay-per-view WITH commercials.
(In response to this post by tarheelblue)
2y
It will just cost us fans a ton.
(In response to this post by tarheelblue)
S
Stech
2y
for expansion IMHO. It’s not been done yet by the P2, but that puts contraction in play, for them too.
PS I think basketball will be included in all of this, basically revenue versus non-revenue sports. John Skipper said that in his interview back in May.
(In response to this post by tarheelblue)
2y
No need for a network to produce the games, the schools can start doing it in house and distribute the games over the internet.
Cuts out the middleman, and the school will be able to reap all of the advertising revenue and PPV revenue.
The ACC schools are pretty much producing all their content themselves today, except for the high profile ESPN/ABC games which are being produced by ESPN I believe.
(In response to this post by Stech)
2y
(In response to this post by Stech)
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Stech
2y
(In response to this post by tarheelblue)
S
Stech
2y
ones they lose for making it more of a professional sport. It's been a professional sport already with coaches making 10 million a year and billions of dollars going to the Universities. My biggest concern is non-revenue sports and how that gets funded when they start paying the players in revenue sports. It's coming and IMHO the train has left the station.
PS Being an older adult, I don't necessarily like all these changes, but it is adapt or lose out. like many things in life.
(In response to this post by EDGEMAN)
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CoolJCPA
2y
(In response to this post by Stech)
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Stech
2y
(In response to this post by CoolJCPA)