Could Cable TV Survive ESPN’s Streaming Ambitions?





Cord cutting has already taken its toll on the traditional pay-TV business, but losing a key channel to streaming could accelerate the implosion of the cable package. 

Disney appears ready to pull the trigger with its planned move to turn ESPN into a streaming channel that you can subscribe to without a cable bundle. 

“Taking ESPN direct-to-consumer isn’t a matter of if, but when,” Disney CEO Bob Iger said earlier this month during the company’s second-quarter earnings conference call. 

While the move could fill Disney’s coffers, it would take away one of the key reasons people still stick with cable – access to live sports. Cable TV is largely dominated by news and sports, with Fox News, ESPN, and MSNBC the top three cable networks in July, according to a breakdown from National Media Spots

Generally speaking, sports content rules above all. Sports events accounted for all but six of the top 100 telecasts of 2022, according to the Sports Business Journal. Short of unpredictable news events, nothing draws people like the big game. 

And ESPN is the king of that hill.

An Escape Plan

It’s clear why Disney wants to create a streaming version of ESPN. The long-term trend of cable customers is on the decline, and that means less revenue for ESPN, despite higher ratings. The top five pay-TV companies, Comcast, Spectrum, DISH, Verizon and Altice lost a combined 1.2 million subscribers in the last quarter. 

“The erosion is happening quicker than people thought,” said James Andrew Miller, an investigative journalist and author of Those Guys Have All the Fun: Inside the World of ESPN, on a podcast with The Press Box earlier this week. 

ESPN continues to be the crown jewel in a lot of cable packages, but things have changed dramatically. Cable is no longer the necessity it used to be as more consumers cut the cord and move away from live TV in general. 

The collapse of the TV bundle, which everybody used to complain about…it turns out it was the golden goose that everyone wishes never went away

“The collapse of the TV bundle, which everybody used to complain about…it turns out it was the golden goose that everyone wishes never went away.”

Writer James Andrew Miller

“The collapse of the TV bundle, which everybody used to complain about…it turns out it was the golden goose that everyone wishes never went away,” Miller said. 

An ESPN spokesman wasn’t immediately available for comment. 

Disney moving towards streaming will only hasten this trend, accelerating cord cutting by taking away one of the only aspects of entertainment you still need a cable package to access. 

Another View

One competitor aren’t so keen to make this move. Fox Corp. CEO Lachlan Murdoch said that while the company is looking at direct to consumer, he said he sees more value coming out of the traditional pay-TV model. He talked about that move to streaming being inevitable, but sees a gradual transition with both options on the table. 

Disney’s CEO, meanwhile, believes that the company can handle the transition. He noted that ESPN ratings continue to rise even as cord cutting rises. 

In July, ESPN’s ratings rose by 163%, with its Spanish language sister network ESPN Deportes gaining 440% (albeit off of a much lower base). Only Fox News had higher ratings, and things should look even rosier with the start of the NFL, NBA and NHL in the coming months.

ESPN isn’t abandoning cable completely. But having the option to stream it directly may still accelerate trends we’re already seeing.

A of that strength is built on the idea that ESPN is one of the pillars of the whole model. Disney looks eager to see what happens once that pillar gets knocked out.

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