disneyESPN is at a crossroads.
For more than 40 years, the world’s largest all-sports network has increased annual revenue by raising cable subscription fees. ESPN first charged pay-TV distributors less than $1 per subscriber per month in the 1980s. ESPN will cost $9.42 per subscriber per month to stream by 2023, according to S&P Global Market Intelligence.
This business model is being eroded. Since 2013, tens of millions of Americans have canceled their cable TV subscriptions, Questions have been raised about ESPN’s future in an increasingly fragmented media landscape. As part of the digital documentary “ESPN’s Battle for Dominance,” CNBC spoke with multiple current and former Disney and ESPN executives to discuss the network’s future direction.
ESPN reported that domestic and international revenue grew just 1% in its most recent quarter, to $4.4 billion. As the number of cable TV customers declines, networks can no longer rely on price increases to make up the difference.
The company has a new two-part streaming plan to revive growth. First, this fall, Disney will offer ESPN outside of traditional cable bundles for the first time as part of a joint venture with Disney. Warner Bros. Discovery and fox. The service, which has yet to be priced, is aimed at non-cable customers who want to watch sports but don’t want to pay $80 or $100 a month for full Internet service.
Second, ESPN will launch its flagship streaming service in the fall of 2025, which will include all content provided by ESPN, both live and on-demand.It will include unprecedented personalization and will work with ESPN betting, the company’s licensed online sportsbook and fantasy sports to cater to young fans. The offering would go far beyond ESPN+, which exists as a $10.99 streaming service that doesn’t include ESPN’s most expensive programming, such as all of “Monday Night Football.”
ESPN President Jimmy Pitaro
Photography by Steve Zucker | Movie Magic | Getty Images
“The industry is in a transition phase right now,” ESPN Chairman Jimmy Pitaro said in an interview for the CNBC documentary.
“We’re seeing a decline in the traditional ecosystem, the cable and satellite universe,” Pitaro said. “The transition to digital is underway. It’s by far the most important part of our future.”
Pitaro and programming chief Roz Durant defend ESPN’s growth The plan was revealed to CNBC, and former Disney and ESPN executives Bob Chapek, John Skipper and Mark Shapiro noted that the so-called global sports Leaders face multiple potential obstacles At the same time it charts the way forward.
Watch the documentary for the full story.
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