Last week a story started to spread all over the Internet that Disney should sell ESPN because of falling subscriber numbers. Many of the stories blamed cord cutting for the falling numbers.
Although cord cutting is likely a big part of the reason ESPN and other networks are seeing dropping subscriber numbers that does not mean Disney should sell ESPN.
Don’t get us wrong. Disney lost 1.903 million subscribers in a single month. That would scare any network executive; however, there is a silver lining to this. Other networks lost big numbers: CNN lost 617,000 and MSNBC lost 530,000 subscribers in the same period.
So why shouldn’t Disney sell ESPN in the face of subscriber losses? In short, because live content is still the number one reason people pay for traditional pay-TV providers such as cable TV. It is far more likely that people are watching ESPN channels for live content, making the ad revenue very lucrative vs other channels that do not show live content.
Of all the channels Disney could sell ESPN should be the last choice. Sports are widely popular and the fact that viewers are more likely to watch live makes commercials hard to miss. Not only can Disney sell traditional ads against ESPN it can also sell ad placements inside the games and shows themselves, making ESPN a one of the most profitable channel in the world according to the Washington Post.
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