As a casual sports fan, I periodically check in with myself: Do I enjoy watching live sports enough to pay for cable?
The answer for the last few years has been: No thanks, I’ll just check out these GIFs on Twitter.
ESPN is having the exact opposite problem, as Ira Boudway and Max Chafkin explain in their latest Bloomberg Businessweek cover story. No matter how innovative or cutting-edge the sports giant makes itself, the cable money is just too lucrative, and the costs of licensing live sports are just too great, to finally cut the cord and offer itself as a standalone internet subscription service the way HBO did with HBO NOW. Boudway and Chafkin do the math:
Other media companies, most notably HBO, have confronted cord cutting by offering their programming “over the top,” which is TV-speak for “on the internet.” More than 2 million people pay $15 a month for access to the HBO Now app, but that strategy doesn’t translate to ESPN. The network’s programming costs are far greater than those of HBO—the budget for an entire season of Game of Thrones costs around $100 million, or less than what ESPN pays for the rights to air a single Monday Night Football game—and ESPN’s customers are accustomed to getting the network at no additional charge as part of their cable package. If ESPN were to charge $15 a month for a standalone streaming channel, it would need more than 43 million subscribers to match the money it collects from cable carriers. HBO has about 35 million total subscribers in the U.S., including cable and over the top.
Now, I’m obviously just one person, but I’m pretty sure I would subscribe to a service that just offers an endless loop of Ezra Edelman’s O.J.: Made in America. Just a thought for the folks over in Bristol.