Things aren't going so well in Bristol

[jtnc]

ESPN may have grown into an unbeatable Goliath, as its executives spent the year telling any reporter who'd stand still long enough, but maybe the stretch marks are beginning to show. ESPN laid off hundreds two months ago, and in August it will face new competition in the form of Fox Sports 1, a network that has Goldman Sachs analysts warning folks to think twice about before buying Disney's stock. And today comes news that ESPN's ratings were significantly down from April to June this year.

 

Sports Business Daily reports that ESPN's primetime ratings dropped 32 percent this quarter over last year's. There is some explanation to the drop: Last year, ESPN carried the Heat-Celtics conference finals, a bigger draw than this year's Spurs sweep over the Grizzlies in the Western Conference finals.

 

But even with that caveat out of the way, the news for Bristol's advertising department isn't encouraging: ESPN's total-day ratings—that is, its average viewership over a 24-hour period—plunged 20 percent in the quarter over last year's numbers. That's the network's worst result in six years and the the biggest drop for any of the cable sports channels, on a percentage basis.

 

ESPN2's primetime ratings dropped 12 percent, and its total-day ratings fell to an average of 244,000 viewers a day, down from 268,000 in the same quarter last year, 266,000 the year before, and 306,000 in 2010.

 

In the first quarter of 2013? Ratings losses all around, again, for both ESPN and ESPN2.

 

What the hell? ESPN does do the lion's share of its ratings business in the second half of the year. That's when Monday Night Football kicks into gear, along with the college football season. But last year wasn't a banner year on that front, either: In 2012, ESPN and ESPN2 were down 2 and 8 percent for the year in ratings for total-day viewers, respectively. ESPN was flat in primetime ratings, and ESPN2 was down 12 percent.

 

All this has happened before the launch of Fox Sports 1, a network that may not challenge ESPN for sports-television supremacy but will at least be the nuisance to Bristol that NBC Sports Network hasn't become (worth noting: NBCSN saw gains all around in the second quarter). Late last month, Goldman Sachs downgraded ESPN's parent company Disney stock from a "conviction buy" to "neutral." The reason? Trouble on the ESPN front (Goldman estimates that ESPN accounts for 45 percent of all of Disney's operating income, which, Jesus Christ). We have a copy of the report. Here's an excerpt:

 

While we continue to view ESPN as a valuable, well-positioned asset over the long-term, in the near-term we are concerned about two issues that will likely overhang DIS. For reference, ESPN is Disney’s largest asset accounting for an estimated 45% of total company OI.

 

1) Rising competitive intensity: Fox Sports 1 will launch this August, with Fox Sports 2 to possibly follow shortly thereafter. Competition between FS1 and ESPN for sports rights will actually be limited because ESPN recently renewed most of its major contracts; the one exception is the NBA contract that expires after the 2015/16 season. However, FS1 will be competing for sports viewers and advertising dollars and this could hamper ESPN’s advertising growth. Admittedly, advertising accounts for only 25% of total revenue, but it carries a higher incremental margin and estimates could be put at risk.

 

2) Sports cost step-ups hamper OI growth, margins: New rights contracts for MLB, NFL Monday Night Football and the new BCS Championship will start in CY1Q14 and run through CY1Q15. As a result, we estimate Cable Network margins are likely to compress and Cable Network segment OI growth will slow from 12% in FY13E to 7% in FY14E and 4% in FY15E.

 

http://deadspin.com/espns-ratings-are-way-down-this-year-whats-the-matte-722030528

 

I haven't watched ESPN in months.  :cam:

 

[KendrickPanther]

Yeah I don't want to see ESPN die but they definetly need to theory tank a new strategy. People watch ESPN because they hold all the TV rights. Nobody watches ESPN for Jaworski, Steven A, Magic, Skip Bayless, Chris Berman, and Merril Hodge. All of those personalities and many other makes me want to flip the channel. They have a strategy to appeal to young men because young men are the most easily influenced by advertising dollars. That's great, but they have completely lost touch with mature adults.

[LinvilleGorge]

Yep, the only time I watch ESPN is for live sporting events.  I haven't watched an ESPN produced show, including SportsCenter, in nearly a year.  Rewind 10 years ago and I had ESPN on in the background almost constantly.

[Steven Smiff]

Kris Beerman = Ball Swallower

[CarolinaNCSU]

ESPN is great for sports in general

 

But at the same time, ESPN sucks ass in general.  The majority of viewers/fans are sadly stupid and need to be spoon fed their ideas, but not at the level at which ESPN operates IMO. 

 

The good outweighs the bad however, so I don't want to see them suffer/shrink/etc.

[jtnc]

If Fox Sports outbids them for NBA coverage they will drop dramatically.

[Steven Smiff]

WNBA is where the audience is

[Steven Smiff]

In the WNBA you can watch that guy named Griner dunk

[Razeyfingers]

I would watch the WBNA but theres that whole "wow my highschool team was that good" aspect. Im missing the part where Im supposed to be impressed. I will watch women when they become the better pilots or drivers like physics say theyre supposed to be, but until theyre the best at a particular sport that Im interested in, no thanks.

[Steven Smiff]

I would watch the WBNA but theres that whole "wow my highschool team was that good" aspect. Im missing the part where Im supposed to be impressed. I will watch women when they become the better pilots or drivers like physics say theyre supposed to be, but until theyre the best at a particular sport that Im interested in, no thanks.

Watch that guy named Griner, he's good.

[Razeyfingers]

Watch that guy named Griner, he's good.

 

brush that toof mang!

[Steven Smiff]

brush that toof mang!

What? That dude named Brittney Griner is the best prospect since Lebron James! He will totally dominate the WNBA, just wait and see!

[Panthro]

Perhaps they should focus on sports

[The Huddler]

fug ESPN. Arent compatable with my internet provider.