
Nielsen estimates ESPN lost 555,000 subscribers during the last month - perseusprime11
http://www.outkickthecoverage.com/espn-loses-another-555-000-subscribers-per-nielsen-112916
======
moonshinefe
Excessive advertising. In the NHL, they used to have nice white boards around
the rinks, now they're all plastered with ads. More and more commercial breaks
during games. Heck, now there are even 'mini-ads' that aren't full commercial
breaks but just show up for 30 seconds then it returns to the action. Let's
not get started with picture-in-picture ads like F1 has.

They've even started digitally projecting ads behind the goalie nets on the
glass. It's just becoming ridiculous. Are they not making enough money
already?

If it weren't for old people set in their ways and sports, I think cable would
basically die. It looks like that may be happening soon anyway, as younger
generations would rather just watch shows commercial free and find alternative
sports to watch (such as esports).

I'm not old enough to have seen it, but I've heard some people say half the
point of paying for cable way back in the day was so you _didn't_ get ads.
That seems to be the case for newer, streaming services.

~~~
usrusr
> I'm not old enough to have seen it, but I've heard some people say half the
> point of paying for cable way back in the day was so you _didn't_ get ads.
> That seems to be the case for newer, streaming services.

And just yesterday I discovered my first "supported by product placement"
disclaimer overlay in a Netflix show. Not a big deal, probably just them
getting in line with local regulations, but it might be a harbinger of things
to come. Not cutting up the goose that lays golden eggs might just happen to
be something that high stakes capitalism is not particularly good at.

~~~
bendykstra
The disclaimer might be new, but not the product placement. The first season
of Netflix's House of Cards, which aired in 2013, had an obnoxious amount. It
even made its way into the dialogue, turning one scene into a 10 second ad.

"Is that a PS Vita. What games does he have?"

"All of them."

"I have a console at home that I play to relax. I could use one of these for
the car!"

[http://www.criticalcommons.org/Members/dsbaldwin32/clips/hou...](http://www.criticalcommons.org/Members/dsbaldwin32/clips/house-
of-cards-sony-ps-vita-product-placement)

~~~
Declanomous
Product placement just kills the pace of the show. My family watched _White
Collar_ together, and it had some really forced product placement from Ford.
They have a scene where a conversation is happening in traffic, and the car
beeps and then does the emergency stop thing. One character tells the other to
keep his eyes on the road, and the other one responds, "It's a Ford, it can
take care of itself. I'm keeping my eyes on you."

That was so forced and stupid my brother and I still quote it. It was so
completely tone deaf that it pretty much cemented Ford as a company that is
completely out of touch.

As time goes on, the product placement bit from Wayne's World gets more and
more topical.

~~~
usrusr
I take comfort in the hope that product placement actually works better when
it is not implemented in that despicably crude way, and that eventually both
sides of the transaction will learn to stay subtle.

If the cool hero uses a motorcycle to escape the evil henchmen I don't care
much wether money was involved in selecting the brand of motorcycle. If he
then spends a minute of screen time lecturing about the benefits of said
brand, it should be considered a new category far beyond product placement.

~~~
groovy2shoes
_Chuck_ had a rather infamous product placement for Subway in the second
season that worked out pretty well. The placement itself was gratuitous and
over-the-top, and it drew quite a bit of criticism from the press. Yet, I
thought it worked well for comedic effect in the context of the show,
especially considering the character involved and the contemporary absorption
of Subway's ad campaign ("five dollar footlongs") into pop culture. Sure, I
rolled my eyes at it, but I also had a good laugh because it was obvious that
the show was self-aware in the way they did it.

Anyway, I only bring this up because, while I agree with you in principle, I
think that _in the right context_ , exaggerated product placements can be as
palatable as subtle ones.

(Later on, when the show was being considered for cancellation, a massive fan
campaign had hundreds of thousands if not millions of fans getting themselves
some footlongs to eat during the season finale and mailing the receipts to
NBC, thus saving the show for three more seasons).

------
bachmeier
My son will soon be a teenager. He has little interest in watching TV. His
default is to go to YouTube and check what's new.

Cable TV was an improvement on over-the-air broadcast networks. It's had a
good run, but serves little purpose today, being inferior in all ways to the
internet. It's just not worth $70, $100, or $140 a month. Our bills rose and
rose until we shut it off completely and permanently - there are limits, and
TV executives don't seem to understand that.

~~~
thirdsun
> My son will soon be a teenager. He has little interest in watching TV. His
> default is to go to YouTube and check what's new.

Of course. I'm 30 and if it wasn't for live sport I'd never watch TV and even
that is going away: Sky Germany lost the right to the british premier league
and before that the spanish La Liga. Both, as well as the italian and french
football leagues, are legally available at DAZN for 10 bucks a month. It's a
great deal.

However besides sports the program just isn't there. It can't be since its
priority is to find the lowest common denominator and please everyone. Which
results in nobody getting what they actually want. YouTube doesn't have those
limitations - you'll find in-depth content for any kind of niche interest and
I welcome it.

I can only assume that traditional TV is even less interesting to today's
teenagers than it is to me, someone who grew up with it.

~~~
ssharp
> However besides sports the program just isn't there. It can't be since its
> priority is to find the lowest common denominator and please everyone. Which
> results in nobody getting what they actually want.

This isn't remotely true. I don't watch that much television but if you look
at what TV critics are writing, there has never been a better time for
scripted television ever. Now that networks like AMC, HBO, Netflix, Amazon,
etc. can produce cost-effective original programming, it has allowed them to
hit smaller audiences are still be profitable. That allows for far more
creativity that the old network model where you had to appeal to such a mass
audience.

I'm curious to what all this great YouTube content that keeps people
entertained for hours on end is. I personally find some of the instruction
content pretty incredible, as well as some of the music content, but I
couldn't occupy that much time with it. Especially with instructional content,
I need to actually apply what I was watching to what I'm trying to accomplish!

It seems like with music content, I'm constantly fighting off recommendations
of low brow content.

~~~
lintiness
most sitcoms on tv worth viewing have adult themes / content, not available to
large networks.

~~~
larrik
I believe very very few of the shows the parent post is talking about are
sitcoms.

------
Animats
The major sports industry may have a problem. Especially Major League
Baseball™, with an average viewer age of 53.[1]

[1] [http://www.cnbc.com/2015/07/12/baseballs-advertising-
worries...](http://www.cnbc.com/2015/07/12/baseballs-advertising-worries-
linger.html)

~~~
mmanfrin
MLB deserves a special level of scorn for building the technology to bring
them in to the digital age _and then blocking a majority of users from seeing
their favorite team_. Local blackouts are fucking asinine -- especially when
the service itself costs $120.

~~~
seanp2k2
100% agree, NHL does this as well. Living near San Jose, can't watch a local
Sharks game when it's happening. Tickets for playoffs games were >$100, and
it's $25/month _just_ for NHL.TV. Details of their blackouts:
[https://subscribe.nhl.com/us#blackouts](https://subscribe.nhl.com/us#blackouts)

It's really just burning the biggest fans. I personally don't care about any
sports, but if I did, I'd probably just find some shady streams online instead
of trying to deal with all their restrictions, rules, and commercials. It
really seems like they have no clue what people want, since they're unwilling
to give it to them at _any_ price. Smart business, IMO, would say, OK, you
want no ads and no blackouts? $500 a year, or whatever. Figure out what it
would cost and show people, so they understand how much they pay with their
credit card and how much they pay with their time + eyeballs each month.

Edit: I'm sure the hardcore fans would take the more expensive package. You
could even offer things like exclusive programming which would happen during
times when commercials play for other lower-tier subscribers. Make it even
cost twice what you're losing in ad revenue. The good will it would do for the
brand, to even offer a no-commercial, no blackout, no contract, no BS option
is not a zero-dollar value for the company either.

~~~
solatic
Take journalism. You can purchase digital only for this much money, or you can
purchase a digital + paper subscription for some amount more. Maybe even a
premium subscription like the New York Times has with the crossword puzzle.

Why can't sports teams do that? Buy paper tickets for individual games for
some amount. Buy digital access for individual games for some other amount.
Buy digital season passes for another amount. Buy paper ticket season passes,
includes digital season passes. Pre-order your digital season pass before the
team goes to pre-season training and get a voucher for a free bleachers seat
for one of the games. If you have a digital season pass, pay a premium to use
an app which lets you decide which camera to watch through, control over
rewinds, etc. Pay another premium to get get a version of the game, a week
after it happened, with audio commentary tracks from the coaches and players.

It's not that hard, and honestly, they'd probably get even more money from the
die-hard fans than they're getting now. The executives are just stuck in the
stone age.

~~~
tunap
Stone age and profiting b/c people keep giving them money. Damned if I'm going
to spend $hundreds on paper tickets, parking & over-priced junk food when the
location of the seats(in said price tier) is determined by someone else to fit
their preferences. The capacity for customer service is huge, but TV ratings
and ads are all they seem to care about... tired pandering script and
contractually required player comments to the 'great fans' notwithstanding.

------
seibelj
I would be happy to pay for ESPN on my Roku exactly as I do HBO Now. $10/month
max, cancel anytime. I would subscribe for NFL season only and quit right
after. Otherwise, I use HD antenna for local games and the occasional
streaming website for a game I really want to see. I really don't care for
their commentary.[0]

[0]
[http://www.espn.com/video/clip?id=17823563](http://www.espn.com/video/clip?id=17823563)

~~~
sbov
ESPN pays out an insane amount of cash for their deals with various sports
leagues. Their business model completely relies on people who don't watch the
channel to still pay them, and seem to be locked into that business model. If
people who only watched ESPN paid ESPN, some estimates put the required
monthly fee to be around $40/month. It's insane. They rode the gravy train for
a long time, but don't seem to have an escape hatch.

~~~
AnAfrican
It's actually the sport teams/leagues that rode the gravy train.

ESPN paid huge amounts because they had to outbid the competition. If
sportsbroadcasting gets less profitable, sports will get less profitable.

~~~
hyperbovine
That's an interesting question: would anything change if the average NFL
salary was $500k instead of the almost $2m that it is now? My guess is no.

~~~
dagw
The average might be $2m, but the median is only ~$750k. So if you flatten the
payscale then you could probably get to a $500k average with most players not
taking too big a paycut.

But let's say you are 15 year old super talents that has every potential to
make many millions in the NFL today. Would they still pursue football if they
could only make at most 25% of the highest paid players today or would they
focus on another sport, and if so which sport might do better in this future?
Perhaps baseball or soccer will become more popular since if you're not
getting paid a lot why risk the head trauma.

~~~
hyperbovine
I don't believe any 15 year old who feels they can choose from among several
pro sporting careers is thinking rationally.

------
jmnicolas
Does someone know why this is happening? This is not explained in the article.

I'm not American, don't have a TV and don't like sports but I'd like to know
why they're loosing so much subscribers now. Is it the economic situation or
people found a better alternative to watch sports?

~~~
cgvgffyv
> I'm not American

I can tell. Don't put a space after a question mark! See?

It gives you away as a Frenchman.

~~~
jmnicolas
Edited. So now nobody knows I'm French! ;-)

------
raverbashing
The main sport being played is how many ads they can have in the least amount
of time and space

It's incredibly alienating

Yes, major leagues are to blame, what comes around goes around

------
pryelluw
TV is now to the smartphone what radio was to the TV. It still a viable
marketing tool in some instances but has lost most of its power. Facebook is
the new NBC. Twitch is the new ESPN (e sports are growinf like crazy). There
is an amazing opportunity for those who recognize this and evolve their
approach to fit the different mediums.

~~~
coldcode
Yeah fighting ads on mobile is the same problem, just on a smaller screen.

~~~
pryelluw
Its a different problem because mobile is about walled gardens (I am against
walled gardens). Fighting ads that appear on an app will become harder and
downright impossible without rooting your device.

------
legodt
What is only touched upon in the comments but not often discussed in depth in
these articles- is ESPN losing subscribers who had eyeballs on their content
or is the majority of this continued slide the effect of general cord cutting
rather than conscious unsubscribing? I would love to see some more detailed
analysis on this breakdown.

------
cmurf
Good? The games take entirely too long, not least of which is all the
advertising that disrupts the natural flow of the game.

------
gcb0
BS detector is high on this article

> But those sports rights costs are going up and those subscriber revenue
> numbers are going down.

i doubt sports rights are going anywhere if even espn can't pay them.

~~~
rhizome
It's like 0.5% of their subscribers.

~~~
gcb0
espn is only 0.5% of sports broadscast?

~~~
rhizome
No, ESPN has ~90MM subscribers.

------
slantaclaus
Luckily for us Disney shareholders we've been getting raked over the coals for
a year now. Hopefully this has already been priced in. Plus, the ad revs for a
captive (read: live) audience are pretty rich.

------
heisenbit
The cable network channels ESPN and Discovery are between a rock and a hard
place. Bidding for content from entitled sports is more expensive but their
customers are running.

Individual customers are cutting cord.

Resell customers are barking at the price of the packages. German public
television decided NOT TO COVER THE OLYMPICS due to the high price Discovery
was charging.

Emerging new channels (Twitter, Youtube, Amazon, Netflix) are getting their
own original content.

~~~
golemotron
It's ESPNexit.

------
f1nch3r
Doesn't this also mean that cable companies lost 555,000 subscribers last
month? The only way for me to get ESPN is with a basic cable subscription.

~~~
ascagnel_
Not anymore -- most cable providers now offer a base tier without sports
channels that are targeted at cord-cutters.

------
kyriakos
Netflix for international live sports is the next big thing. It's extremely
hard to get around the licensing though.

~~~
joering2
Theoretically speaking... couldn't a startup mimic Uber?

An app that I can find someone who has their cellphone pointing at their
screen LIVE with a game on... and I pay that person pennies to watch it.

AFAIK there is some sort of a loophole that re-brodcasting even live show by
recording it off of your screen (showing TV frame etc) is not illegal.

Am I wrong?

~~~
kabes
Loophole's gonna get closed as soon as such service would gain traction. You
don't want to rely your business on that

~~~
joering2
you right! I mean better not to learn Uber lesson :)

------
Hondor
It seems they've got about 90,000,000 subscribers, so 500,000 is only half a
percent drop. As the article projects, it'll still be many years before
they're disrupted out of business.

~~~
pwg
The premise of the article is not that a 500,000 drop is significant by
itself. It is that ESPN has huge contractual costs to teams/leagues to carry
sports over the next several years that cost enough that they need (for
example) 85,000,000 subscribers minimum in order to pay their overhead costs.

So it is not a 500,000 loss against 90,000,000 total, it is a 500,000 loss
against a buffer of 5,000,000 [1] extra beyond the minimum subscriber point
they require to bring in enough money to pay their obligations. 500k against
5M is a 10% reduction in their buffer zone in one month.

------
leepowers
There's only two good things that ESPN broadcasts:

* Live Sports * "30 for 30" documentaries

Aside from these it's mostly noise - sports commentary and sports news. Which,
not incidentally, are the cheapest forms of programming on the channel.
Quality programming will almost always find an audience in the Internet era.
ESPN has a lot of low-quality filler that viewers simply don't want to pay
for.

------
dnackoul
I used to watch Sports Center for highlights (now the internet makes sure I
don't miss anything noteworthy) and occasionally the talk shows (which now
rarely cover inside the lines topics). I think without reliable non-event
programming it's hard to justify an entire channel.

------
jordanbaucke
Started seeing them doing 'eSports' drops occasionally now... gasp! (I thought
their long-form "OJ" documentary was excellent!)

------
Shivetya
One thing to also take into understanding, for the heavily negotiated games
like American football, baseball, and basketball, less revenue from TV
contracts will certainly affect future negotiations with their respective
player unions. It will be curious when that profitability number is crossed
and how the leagues adopt to it. They can only squeeze broadcasters and fans
so much.

------
lordnacho
Perhaps someone could give us non-Americans some insight into how TV works
over there.

Whenever I'm visiting relatives, it's just this huge mess on TV. They have the
same shows like Big Bang Theory, but it's not clear to me how it's
distributed. Some channels seem to be local, while others seem to be planet-
wide like CNN. The amount of advertising is insane, I can't watch it. Also
there's these low quality local business ads that you never see in Europe.

What's a network, what's cable, what's a blackout, and what does it matter?

Also, what is the impact of free internet video? I can pretty much watch any
soccer match I want by googling it during the match, including some quite
obscure ones. Could it be that US sports viewers have discovered this as well?
In fact the US sports lend themselves to highlights, because they're so
incredibly long and full of ads.

~~~
AnAfrican
Blackouts in Europe don't happen because most right-holders are national.

But basically, a particular sports event shown on one channel will not be
broadcasted because another channel holds the rights in that juridiction.

It happens a lot on Sattelite TV in Africa...

TF1, the biggest French Channel is broadcasted on Canal Sat Africa. TF1 shows
Formula One events. But they only hold the rights for France.

Since Canal Plus (the channel) or SuperSports (South African Channel) hold the
rights for Africa, TF1 is blacked out during Formula One events.

~~~
AnAfrican
Furthermore, in the US, local channels pay for exclusive rights to broadcast
sports events for local teams.

So while your New York-Chicago may be available on MLB or NBA's streaming
service, it will be blacked out in Chicago and New York because a TV channel
has paid for the exclusive rights.

------
debt
gonna be a ton of bummed out dads and uncles if espn goes belly up.

~~~
pbae
This is a good thing. The sports themselves don't go away. This just means
that the cable sports business model is less viable. Maybe now MNF, the
hallowed American institution, will go back to network and be viewable by the
rest of us.

~~~
charlieflowers
Agreed. I see this as the death of the "forced bundle." People who don't care
about football are now finding that they don't have to pay for it. They're
cutting the cable.

Others can still watch it, mostly OTA, but through some paid options as well.

So only the artificial inflation of revenue due to the forced bundle is going
away.

