ESPN’S SURRENDER TO GRIM NEW REALITY:
The reality is that the glory days are over for ESPN. Instead of making the $6.4 billion it earned in 2014, it’ll soon be earning $2 billion or less. Iger, or his successor, will have to decide whether to invest in it or to let it hobble along in its diminished shape. Disney will have to decide whether to keep paying megabucks for professional sports rights — thinking of them as loss leaders like the Olympics for NBC — or whether to give up those rights to save money. If it does the former, ESPN’s profits will dwindle even more. If it does the latter, fewer sports fans will want to subscribe.
I’ve been in the magazine and newspaper business my whole working life. I’ve watched the same forces diminish my industry. My former employer, the New York Times, has millions more viewers and subscribers than it ever did when print reigned supreme. Yet it is barely profitable, because the internet destroys a media company’s advertising base and the Times can’t charge subscribers as much as it could charge when readers were buying the dead tree version.
In both cases, perhaps alienating half your potential customers after posing as “objective” may not have been the best strategy for survival.