coit
Persecuted for his beliefs
- Joined
- Nov 29, 2007
- Messages
- 88,570
http://www.outkickthecoverage.com/espn-loses-another-555-000-subscribers-per-nielsen-112916
"According to SNL Kagan ESPN is on track to pay $7.3 billion in total rights fees in 2017. That's more than any company in America.
Presently ESPN is on the hook for the following yearly sports rights payments: $1.9 billion a year to the NFL for Monday Night Football, $1.47 billion to the NBA, a deal I told you flat out wasn't sustainable back in July because it meant every single cable and satellite subscriber in the country was paying an average of $30 a year for the NBA whether they watched or not, $700 million to Major League Baseball, $608 million for the College Football Playoff, $225 million to the ACC, $190 million to the Big Ten, $120 million to the Big 12, $125 million a year to the PAC 12, and hundreds of millions more to the SEC.
How does that content cost compare to revenue?
Well, let's be extremely conservative and assume that ESPN is going to lose 3 million subscribers this year. ESPN lost over 4 million subscribers last year and no months last year were as bad as as the past two months have been so this is probably being extremely generous. (The pace of decline in these past two months, an average loss of 588,000 subscribers a month, would be over 7 million lost subscribers. But even if we presume that these past two months are just bad outliers -- the average number of lost subscribers over the past several years has been right at 3.5 million -- things get really bad, really fast. And if these new losses are the new normal, then ESPN is officially dead).
A loss of 3 million subscribers would leave ESPN with 86 million subscribers in 2017. That would be down roughly 15 million subscribers in the past five years alone. Given that ESPN makes right at $7 a month from every cable and satellite subscriber a year, that means ESPN's subscriber revenue would be $7.22 billion in 2017. Toss in an additional $1.8 billion or so in advertising revenue and ESPN's total revenue would be $9 billion. We don't know what the costs of running ESPN are -- employees, facilities, equipment, and the like have to cost a billion or more -- but it's fair to say that ESPN is probably still making money in 2017."
"According to SNL Kagan ESPN is on track to pay $7.3 billion in total rights fees in 2017. That's more than any company in America.
Presently ESPN is on the hook for the following yearly sports rights payments: $1.9 billion a year to the NFL for Monday Night Football, $1.47 billion to the NBA, a deal I told you flat out wasn't sustainable back in July because it meant every single cable and satellite subscriber in the country was paying an average of $30 a year for the NBA whether they watched or not, $700 million to Major League Baseball, $608 million for the College Football Playoff, $225 million to the ACC, $190 million to the Big Ten, $120 million to the Big 12, $125 million a year to the PAC 12, and hundreds of millions more to the SEC.
How does that content cost compare to revenue?
Well, let's be extremely conservative and assume that ESPN is going to lose 3 million subscribers this year. ESPN lost over 4 million subscribers last year and no months last year were as bad as as the past two months have been so this is probably being extremely generous. (The pace of decline in these past two months, an average loss of 588,000 subscribers a month, would be over 7 million lost subscribers. But even if we presume that these past two months are just bad outliers -- the average number of lost subscribers over the past several years has been right at 3.5 million -- things get really bad, really fast. And if these new losses are the new normal, then ESPN is officially dead).
A loss of 3 million subscribers would leave ESPN with 86 million subscribers in 2017. That would be down roughly 15 million subscribers in the past five years alone. Given that ESPN makes right at $7 a month from every cable and satellite subscriber a year, that means ESPN's subscriber revenue would be $7.22 billion in 2017. Toss in an additional $1.8 billion or so in advertising revenue and ESPN's total revenue would be $9 billion. We don't know what the costs of running ESPN are -- employees, facilities, equipment, and the like have to cost a billion or more -- but it's fair to say that ESPN is probably still making money in 2017."
