ESPN’s John Skipper doesn’t see any benefits in new TV models – yet.
ESPN chief John Skipper is happy to talk to any of the so-called new over-the-top Web video players surfing around the fringes of the cable TV business. But he doesn’t see any major deals happening soon — if ever.
In a conversation with Reuters at this year’s cable show, Skipper was blunt about his skepticism over the idea his network – the best paid in the business according to SNL Kagan data — could work with a new Web partner, a tie-up that may in some way threaten the cozy $100 billion a year cable programmer-distributor relationship which feeds the entire industry.
“We have a significant stake in maintaining the current model. There’s no advantage to us in new models that undercut what we have today,” said Skipper, speaking from the NCTA Cable Show in Boston.
ESPN pays tens of billions of dollars every year in sports rights fees to major sports and college leagues — much of which is live programming that doesn’t lend itself naturally to the subscription video-on-demand model popularized by the likes of Netflix and Amazon, he points out.
The Disney-owned sports network is the envy of the cable television business, and several major rivals, like News Corp and Comcast Corp’s NBC Universal, would love to replicate its model.
Skipper was careful to play down recent bullish comments about ESPN’s strengths versus potential rivals. But he pointed out that, while he respects his rivals, it would be difficult for them to build a new sports network to the size, scale and fees that ESPN enjoys today.
He also disputed the idea that the rising cost of sports could one day see ESPN forced onto a sports tier.
Content everywhere? More like content nowhere
Will Big Media and Big Tech companies ever stop punishing their biggest fans?
Like many people, I woke up yesterday and reached for my iPad for my morning hit of news, entertainment and information, so I could start my day. (And like many, I’m embarrassed to admit it.) Padding to the front door to get a newspaper still sounds more respectable, but my iPad gives me a far more current, rich and satisfying media experience than a still-warm printed Times could ever produce.
Except, lately, it doesn’t. Yesterday morning, I saw the exciting news that Bill Simmons, ESPN’s most popular, profane and controversial writer, had secured an interview with President Obama. Simmons published his interview in podcast, text and video form on Grantland, a longform sports journalism website he founded last year under the ESPN umbrella. I clicked over to the story from my Twitter feed and saw three YouTube excerpts of Simmons with Obama. And that’s all I saw. When I hit play on the videos, I discovered ESPN had set them to be “unavailable” on mobile devices.
Moving on, I tried to read a New York Post headline that also found its way into my Twitter feed. But when I tapped in, the Post webpage that loaded was not the story I wanted to read. Instead it was a notice, which I took as an admonition, that to read New York Post content on an iPad, I would have to download the app, which retails for $1.99.
I want to make it clear that I’m not against paying for content. But what I’ve just described aren’t paywalls, where publications warn users that they won’t be able to consume content for free.
The situations I’m describing are blanket denials of content because of a choice I made about which device to use. With these tactics, media companies aren’t creating content paywalls, they’re creating content ghettos. Big Media, set my content free! Stop messing with the user experience to deny readers their content simply because you can detect what platform they’re on. And stop punishing users who are investing in the latest devices to consume your output. In other words, grant my hyper-advanced iOS device or my friend’s fancy new Android phone just as much access to the Web as my mother’s four-year-old Windows XP PC. Which one of us do you think wants to watch Simmons talk crossover dribbles with the Commander-in-Chief?
There’s one big issue with your article, and that is it doesnt’ touch on the advertising model of an iPad version vs a web version. Though it’s changing fast, advertisers were slower to adopt iPad platforms, and therefore, to the media company were perhaps less profitable. You can’t have an ad-supported or near-free model if there aren’t advertisers willing to buy on that platform.
So far, most of these digital platforms have not monetized as well as the traditional players, and that has everything to do with the decision making process.
Boycott an iPad advertiser? That’s silly. They’re the ones that are helping you out. You should be boycotting the advertiser that ONLY wants tos how up on their web site. There is also generally less real estate on the screen of an iPad app to unobtrusively show you ads as compared to your mother’s 4 year old XP system.
And $1.99 for a permanent application is hardly “through the nose” … How much does a single print edition to the NY Post cost? I can’t imagine that the app couldn’t pay for itself in a few days.
Maybe the real problem is the group of whiney consumers (and blog writers) not willing to spend $1.99 on an app that gives them full access, when in the old days it would’ve been 50cents/day?
ESPN’s new Skipper comes out fighting
We had the pleasure of incoming ESPN President John Skipper’s company on Monday at the Reuters Media Summit in New York. Skipper, whose promotion was announced just ahead of Thanksgiving Day, had been the No.2 to George Bodenheimer, now promoted to executive chairman.
In the last few years ESPN has become the 800-pound gorilla in the pay-TV industry through its mix of exclusive sporting licenses with many of the top sporting leagues and events. But those deals cost money — like the eight-year NFL TV rights that cost $15.2 billion. Even Skipper, in his first interview since his appointment was announced, acknowledged the deal as “expensive” but added the caveat that ESPN generates great value from NFL rights.
The high cost of sports programming is one reason ESPN is the most expensive cable network in the US at around $4 per subscriber. Most cable networks charge a lot less than $1.
But Skipper is adamant that ESPN is worth every penny and pushed back strongly at any suggestion that cable companies could create new tiers to help customers pay less if their package don’t include ESPN.
“It’s demonstrably true that ESPN provides more value to our distributors than any other network — by far, there’s not a close second. If you survey cable, telco and satellite customers they believe ESPN provides the most value. The distributors themselves believe we provide the most value.
I reject the notion (that ESPN high cost should see it placed on higher priced tiers). I think the current package of pay-TV products that comes through on basic cable is a high value proposition to the consumer I don’t think breaking them up is going to provide the consumer better option. If they become broken up in an a la carte world the individual channels are going to more expensive. Consumers would get less channels and pay more money.
Every distributor will do deals with us because they believe the best protection I have against cord-cutting is having ESPN.”
No NBA games on TV? American Chopper still rolling
The NBA season should have begun last night. The big match-up was supposed to be between the Dallas Mavericks and the Chicago Bulls. But of course that never materialized.
It’s unfortunately nearing the point where the league will be hard-pressed to play a full season, even if an agreement is reached soon. Only so many games can be squeezed into January, February and March.
So what is a fan to do? Look around for other entertainment, probably, whether that’s NCAA basketball or ice hockey. Or Storm Chasers. Or American Chopper.
In fact, Discovery Communications Chief Executive David Zaslav, whose networks broadcast those two shows plus a host of other adventure and science programs that draw a male 18-49 demographic, could be a beneficiary of the NBA lockout. He was asked just that question on a conference call.
“Look, on the NBA front, having male audience available is an opportunity for us,” he said while discussing his company’s quarterly earnings .”We do have an overlap with sports viewership, it should work out to our advantage, but we’re taking a wait and see attitude.”
The hope is that viewers would find shows like “American Chopper,” get hooked and stay with them even when the NBA gets back to business.
Time Warner is coming at the lockout from another angle. It stands to be one of the losers if more games are cancelled, since TNT is a chief broadcaster of NBA games. It cautioned on Wednesday that the loss of games in the fourth quarter would weigh on advertising sales at Turner — which oversees TNT – although executives also noted that there would be some offset because of lower programming costs.
The league decided years ago to emphasize and glorify individual players over team play. This of course led to the selfish arrogant “me” first and “me always” play the NBA embodies today. Watching football, soccer, baseball or hockey where team play is so valued by players and fans alike, I can only wish the league and its pouty selfcentered players would go away and never come back.
ex-nbafan
When it comes to NFL, TV executives put on brave face
Shrewd? Prescient? Delusional? Tough to know, but top TV executives this week all seemed relatively confident — even off the record — when asked about the chances that NFL games would be played this fall.
The background, of course, is that NFL team owners and players are at odds over salary caps and other issues, raising the possibility of a lockout and the cancellation of some or all of the 2011 football season. Very bad news, if you’re a fan or a network executive.
As Yinka Adegoke and Liana Baker wrote in a piece this spring, “It is difficult to overstate the importance of the NFL to the revenue and profits of broadcasters like CBS Corp, Walt Disney’s ESPN, Comcast Corp’s NBC and News Corp’s Fox.”
Consider this: The broadcast and cable networks that share the NFL rights sell about $3 billion in advertising time for games each season. That’s $3 billion that’s up for grabs.
As TV executives made the rounds this week to introduce their 2011-12 prime-time schedules, they couldn’t escape the 800-pound linebacker in the room. It’s noteworthy that all of them — even if they were privately sweating — put on a brave face. Here’s a taste… “They’re going to play,” said John Skipper, who oversees content for ESPN. “I don’t know when they are going to play, but eventually they will play, and we will show it on Monday nights.”
If you really want brass, check out the what Entertainment Chairman Bob Greenblatt had to say over at NBC, which counts on the NFL for blockbuster ratings every Sunday night. “We’ve obviously pretty close to what’s going on with this situation. We’re feeling pretty optimistic that football will be there. Worst case scenarios is we might have delay of games for a few weeks, in which case we’ve got a contingency plan to produce several high quality live event reality type shows that will fill out Sunday. But we’re feeling pretty good about where we’re going to be with the NFL.”
And Fox? A bit more wishy-washy, but hardly any signs of panic. “I think they’re planning for there to be an NFL season and at the same time working on contingencies if there’s not,” said Fox Networks Entertainment Chairman Peter Rice.
Time Warner Cable’s unique ESPN Web deal
Many media business journalists let out a collective sigh of relief at the news that Time Warner Cable had finally inked its deal with Walt Disney to keep carrying its programming, including ABC, Disney channels and various ESPN networks. The programming fee negotiations had gone late into the night past their Wednesday midnight deadline and hacks, who had seen this movie before, were just starting to tire of waiting for another midnight watch.
Perhaps the most interesting part of the deal is that Time Warner Cable’s ESPN customers will now have access to ESPN3.com, a website ESPN uses to show more than 3,500 live events, including matches from the World Cup this summer.
This is unlike other ESPN3 deals which have typically been tied to the cable operator’s Internet service provider. In those cases, ESPN3 would only be accessible to ISP customers of the cable operator.
Time Warner Cable’s deal comes under the auspices of TV Everywhere, the project that Time Warner Inc and Comcast Corp have been trying to convince the cable industry to support.
ESPN, ESPN2 and ESPNU will also be available online to authenticated Time Warner Cable customers as part of this deal.
“We wanted to make sure this was a product available to our video customers who get ESPN, and that they wouldn’t have to pay extra for it,” said Time Warner Cable spokesman Justin Venech.
(Photo: Reuters)
from Summit Notebook:
ESPN: We all live in sports towns (And tell great jokes)
ESPN President George Bodenheimer has been at the business of TV sports, one way or another, for nearly three decades, starting in the mailroom and working his way up.
It's the classic media story -- and this one even involved a stint driving through nearly every little town in Texas, Arkansas, Oklahoma, Louisiana and Mississippi to sell this odd new 24-hour sports network to cable distributors.
Here's one thing he's learned: Every town thinks it's a sports town. Sort of like everybody thinks they have a good sense of humor.
As he said at the Global Media Summit:
Every town I pulled into, I was calling cable operators. They'd say 'Hey George, your idea is a little crazy. And we're glad you're here -- but this is a sports town.' I'm telling you from experience every town in the United States, and maybe the world, I don't think that's an overstatement, considers itself a sports town. People always said we're in a niche business. If we're in a niche, we're in a mighty big niche."
And that hasn't changed. Indeed, given the downturn in the economy, people may be more sports-crazed than ever, he said.
I think sports is a little bit of comfort food to people in the United States and indeed around the world. It's why there's a lot of fans. It takes you to a different place. There's a beginning, a middle and an end. You see an outcome. The value is only going to grow in the DVR world and the 'I gotta have everything in two minutes world.' I just think live sports are going to continue to be a bit of an oasis in be a good driver for the media business.
Tuesday media highlights
Here are some of the day’s stories about the media industry:
Amazon Patents Detail Kindle Advertising Model (Mediapost) Laurie Sullivan writes: “The patents clearly note that Amazon would insert advertisements throughout the ebooks, from the beginning to the end, between chapters or following every 10 pages, as well as in the margins.”
> In-Book Ads Coming to the Amazon Kindle? (Fast Company) > 6 Reasons Why Ads On The Kindle Don’t Work (Business Insider)
Deadline for Globe bids postponed (Boston Globe) “The New York Times Co. has postponed tomorrow’s deadline for prospective buyers of The Boston Globe to submit preliminary bids for the newspaper, people briefed on the sales process said. No new date has been set for the bids,” writes Robert Weisman.
ESPN to relaunch UK channel in August (Reuters) “The Walt Disney-owned (DIS.N) sports network ESPN said on Tuesday it would launch a new channel in Britain in August to show its 46 Premier League soccer matches and other international sports programming.”
NYC announces initiatives aimed at strengthening media industry (Romenesko) “One of Mayor Bloomberg’s eight initiatives: Establishing a Media and Tech Fellowship to be awarded to approximately 20 “rising star” media and technology entrepreneurs on an annual basis.”
Google’s Gmail says bye-bye beta (Reuters) Alexei Oreskovic writes: “The change is part of a broader move that Google announced on Tuesday involving Google Apps, the company’s suite of online software products that includes Google Docs and Google Calendar, among others.”
Baseball makes its pitch in new ad campaign
Ah spring. Opening day. Stolen bases. Hot dogs. Rain delays. Fresh baseball commercials flashing across your TV set.
Major League Baseball has just taken the wraps off its new 2009 campaign, “The is Beyond Baseball,” supported by 20 TV spots running through the World Series.The spots will run on ESPN, Fox, TBS, MLB Network and MLB.com.
The idea, developed by McCann Erickson, is that baseball is more than just a game; it’s part of the fabric of our culture. In trying to get that message across, the spots will play up the stories behind star players like Tim Lincecum of the San Francisco Giants and Ryan Howard of the Philadelphia Phillies.
And what’s an ad campaign without a web element? Here’s how the release describes baseball’s effort: “In addition, MLB.com will host Beyond.Baseball.com, which will feature interactive elements of the campaign including the campaign commercials, the MLB Network special, highlighted player profiles, a photo gallery, production outtakes, online vignettes and a detailed campaign description.”
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Now showing: The cable show
The big story in the media for the rest of the week is the annual National Cable Telecommunications Association Show, or “the cable show,” as its commonly called.
This year’s primary topic looks like it will be how the big, traditional operators in the business will adapt to an age when the Internet is giving people more options to watch shows, and not always in a way that feeds the bank.
Here is our own take on the show from the Reuters wire:
Both sets of companies will be brainstorming on how to cope with or benefit from disintermediation: consumers can now watch decent-quality video online whenever they want, and often for free.
“Last year, cable companies were in a more probelgradetectionist mode but now they’re facing up to the inevitable trend, because online video is really here to stay,” said Tuna Amobi, equity analyst at Standard & Poor’s.
Executives will also have the economy on their minds.
“The current recession has cut into consumer spending for household TV and telecommunications, while also causing most marketers to reduce their advertising budgets,” said Collins Stewart analyst Thomas Eagan.
