ESPN axing staff right and left, but ...

[DTP]

I don't care for ESPN outside of live sports (and **** guys like May and Finebaum), but ESPN being in financial trouble is not something we should be celebrating.

Like it or not ESPN has a huge stake in the ACC, especially with the upcoming ACC network. ESPN losing money means less money to pay conferences for media rights (remember Fox is also in financial trouble), which hurts Miami's revenues.

I hope ESPN makes some changes, but wanting them to fail, if you're a UM fan, is pretty dumb

Disagree strongly. What has this ACC money done for Miami so far? $EC gets the most $$$$ from E$ECPN and use that advantage to hire huge staffs and improve facilities, since (with the exception of Vandy) they have the taxpayer pay for the physical plant, academic salaries, to a good extent. I have been harping on this board for years about Athletic Department spending caps on a per sport basis, i.e. want to pay $10 mil a year on a HC and $5 mil on assistants? Guess what, if your budget cap is $20 mil a year, you only have $5 mil for everything else. This effectively does what the NCAA states it does, BUT DOESN'T: Enforce a competitive balance by leveling the playing field when it comes to $$$$.

The 'Canes flourished when it was a hard-work, hustle and maximizing your local ties CFB...Money has ruined the sport so much that we are headed to only the huge money programs having a real shot, say 15-17 teams MAX.

Getting the crazy $$$$ out of CFB will save CFB...No E$ECPN is a good thing for the 'Canes.

i'm with you about the money muddying up the waters, but ILCane is 100% right. ESPN failing is not a good thing for sports franchises and colleges. IT may be good for sports consumers but that's to be determined. His above points about the ACC network are absolutely correct. The looming ACC network / incoming cash flow played a factor in our ability to pay $4mil a year for richt. The SEC money likewise played a factor in enlarging the gap b/w college programs and coaching staff salaries, but there is no argument that the ACC money on the whole is beneficial to UM. Having a market player like ESPN (or any market player) drives up the price for ACC sports rights.

Money in sports has hit it's ceiling. If you look at the ridiculous rate at which major sports including CFB and CBB have increased revenue over the last 30 years, you know that it can't keep getting bigger forever. TV money fuels these revenues and with so many households cutting the chord on cable/satellite, the ad money just won't be the same anymore. In the short term, it will still be business as usual but in coming years, these right to broadcast contracts are going to expire and whatever network, be it ESPN, FOX or anybody, will not be bidding nearly as much money for the next contract. It's probably a good thing for college football as it's gotten to the point where only a handful of schools can spend the ridiculous amounts of money required to run a top flight program these days. In ten years, we'll all be saying "remember when they paid college coaches 10 mil a year?" That money isn't going to be there forever.

 

[CaneSince4Ever]

[MENTION=9161]CaneFan79[/MENTION]...

What has this ACC money done for Miami so far?

No E$ECPN is a good thing for the 'Canes.

You obviously don't know what you're talking about. UM gets $20M a year from ESPN, that's on top of the $12M per year UM gets from Adidas. ESPN is the most important source of revenue keeping us from jumping ship to the SEC.

 

[OriginalCanesCanesCanes]

I don't care for ESPN outside of live sports (and **** guys like May and Finebaum), but ESPN being in financial trouble is not something we should be celebrating.

Like it or not ESPN has a huge stake in the ACC, especially with the upcoming ACC network. ESPN losing money means less money to pay conferences for media rights (remember Fox is also in financial trouble), which hurts Miami's revenues.

I hope ESPN makes some changes, but wanting them to fail, if you're a UM fan, is pretty dumb

Disagree strongly. What has this ACC money done for Miami so far? $EC gets the most $$$$ from E$ECPN and use that advantage to hire huge staffs and improve facilities, since (with the exception of Vandy) they have the taxpayer pay for the physical plant, academic salaries, to a good extent. I have been harping on this board for years about Athletic Department spending caps on a per sport basis, i.e. want to pay $10 mil a year on a HC and $5 mil on assistants? Guess what, if your budget cap is $20 mil a year, you only have $5 mil for everything else. This effectively does what the NCAA states it does, BUT DOESN'T: Enforce a competitive balance by leveling the playing field when it comes to $$$$.

The 'Canes flourished when it was a hard-work, hustle and maximizing your local ties CFB...Money has ruined the sport so much that we are headed to only the huge money programs having a real shot, say 15-17 teams MAX.

Getting the crazy $$$$ out of CFB will save CFB...No E$ECPN is a good thing for the 'Canes.

i'm with you about the money muddying up the waters, but ILCane is 100% right. ESPN failing is not a good thing for sports franchises and colleges. IT may be good for sports consumers but that's to be determined. His above points about the ACC network are absolutely correct. The looming ACC network / incoming cash flow played a factor in our ability to pay $4mil a year for richt. The SEC money likewise played a factor in enlarging the gap b/w college programs and coaching staff salaries, but there is no argument that the ACC money on the whole is beneficial to UM. Having a market player like ESPN (or any market player) drives up the price for ACC sports rights.

Money in sports has hit it's ceiling. If you look at the ridiculous rate at which major sports including CFB and CBB have increased revenue over the last 30 years, you know that it can't keep getting bigger forever. TV money fuels these revenues and with so many households cutting the chord on cable/satellite, the ad money just won't be the same anymore. In the short term, it will still be business as usual but in coming years, these right to broadcast contracts are going to expire and whatever network, be it ESPN, FOX or anybody, will not be bidding nearly as much money for the next contract. It's probably a good thing for college football as it's gotten to the point where only a handful of schools can spend the ridiculous amounts of money required to run a top flight program these days. In ten years, we'll all be saying "remember when they paid college coaches 10 mil a year?" That money isn't going to be there forever.

Wrong on a couple of points.

Coaches salaries will continue to increase.

There is no money "ceiling". That concept is just pulled out of your rear end. Who says there's a money ceiling? You? Quite the opposite if history is to be taken into account. The ESPN model is what's shrinking and out of date. The business and money are still in the system, the distribution models are changing. ESPN either adapts or will continue to see shrinkage of their business.

There is a strong trend towards cord cutting and la cart selection, but the money still exists in the universe and it's not shrinking.

Like traditional taxi companies vs Uber, a more nimble competitor could not only take their lunch but make the pie much bigger, like Uber is doing.

Adapt or become extinct.

 

[MrHurricane305]

fs1

Jason Whitlock is 10,000x worse than anyone on ESPN.

He was 100% right about Golden and was way before anyone else.

A fat piece of **** loser squirrel finds a nut every now and then

Damm, why don't you tell me how you really feel about him

 

[Miamicane]

I don't care for ESPN outside of live sports (and **** guys like May and Finebaum), but ESPN being in financial trouble is not something we should be celebrating.

Like it or not ESPN has a huge stake in the ACC, especially with the upcoming ACC network. ESPN losing money means less money to pay conferences for media rights (remember Fox is also in financial trouble), which hurts Miami's revenues.

I hope ESPN makes some changes, but wanting them to fail, if you're a UM fan, is pretty dumb

Disagree strongly. What has this ACC money done for Miami so far? $EC gets the most $$$$ from E$ECPN and use that advantage to hire huge staffs and improve facilities, since (with the exception of Vandy) they have the taxpayer pay for the physical plant, academic salaries, to a good extent. I have been harping on this board for years about Athletic Department spending caps on a per sport basis, i.e. want to pay $10 mil a year on a HC and $5 mil on assistants? Guess what, if your budget cap is $20 mil a year, you only have $5 mil for everything else. This effectively does what the NCAA states it does, BUT DOESN'T: Enforce a competitive balance by leveling the playing field when it comes to $$$$.

The 'Canes flourished when it was a hard-work, hustle and maximizing your local ties CFB...Money has ruined the sport so much that we are headed to only the huge money programs having a real shot, say 15-17 teams MAX.

Getting the crazy $$$$ out of CFB will save CFB...No E$ECPN is a good thing for the 'Canes.

i'm with you about the money muddying up the waters, but ILCane is 100% right. ESPN failing is not a good thing for sports franchises and colleges. IT may be good for sports consumers but that's to be determined. His above points about the ACC network are absolutely correct. The looming ACC network / incoming cash flow played a factor in our ability to pay $4mil a year for richt. The SEC money likewise played a factor in enlarging the gap b/w college programs and coaching staff salaries, but there is no argument that the ACC money on the whole is beneficial to UM. Having a market player like ESPN (or any market player) drives up the price for ACC sports rights.

Money in sports has hit it's ceiling. If you look at the ridiculous rate at which major sports including CFB and CBB have increased revenue over the last 30 years, you know that it can't keep getting bigger forever. TV money fuels these revenues and with so many households cutting the chord on cable/satellite, the ad money just won't be the same anymore. In the short term, it will still be business as usual but in coming years, these right to broadcast contracts are going to expire and whatever network, be it ESPN, FOX or anybody, will not be bidding nearly as much money for the next contract. It's probably a good thing for college football as it's gotten to the point where only a handful of schools can spend the ridiculous amounts of money required to run a top flight program these days. In ten years, we'll all be saying "remember when they paid college coaches 10 mil a year?" That money isn't going to be there forever.

Exactly. The "sky is falling" folks are probably over exaggerating, but the bubble is real. When the TV rights deals come up in the next round of negotiations, the networks like ESPN, fox, etc won't be willing to pay as much and there will be an obvious market correction. The situation is a little more complex when u start mixing college and pro sports but essentially the decreased media revenues will drive down player contracts in pro sports and it will drive down coaches salaries in college sports. since colleges don't have to pay the players the effect will be see where the money actually goes e.g. coaches, facilities, etc. the networks use the large rights fees to justify their expensive per channel deals with the cable companies and the cable companies pass those costs along to consumers. consumers are responding by cutting the cord and demanding a la carte options which is massively disrupting the entire ecosystem and forcing changes to the bundling structure. the bundling structure basically props up the sports world / rights fees but ppl are realizing how much they actually pay for sports and its crazy when u look at the ratio of overall subscribes compared to actual viewers of sports events. ex: espn has like 90 mil subs but more than half are only ESPN subs because they're forced to accept the bundles so those ppl are essentially subsidizing sports for the ppl who actually watch. IMO the biggest wrinkle in all of this is tech/media companies like twitter, FB and amazon. they have the financial backing to seize these $ rights to live sports and if they pursue this path they could actually keep the bubble going - would be interesting to see if they can fix the current broken biz model but who knows. IF they don't go this direction and leave it to the traditional companies then we will indeed see the bubble burst sooner rather than later

 

[Miamicane]

I don't care for ESPN outside of live sports (and **** guys like May and Finebaum), but ESPN being in financial trouble is not something we should be celebrating.

Like it or not ESPN has a huge stake in the ACC, especially with the upcoming ACC network. ESPN losing money means less money to pay conferences for media rights (remember Fox is also in financial trouble), which hurts Miami's revenues.

I hope ESPN makes some changes, but wanting them to fail, if you're a UM fan, is pretty dumb

Disagree strongly. What has this ACC money done for Miami so far? $EC gets the most $$$$ from E$ECPN and use that advantage to hire huge staffs and improve facilities, since (with the exception of Vandy) they have the taxpayer pay for the physical plant, academic salaries, to a good extent. I have been harping on this board for years about Athletic Department spending caps on a per sport basis, i.e. want to pay $10 mil a year on a HC and $5 mil on assistants? Guess what, if your budget cap is $20 mil a year, you only have $5 mil for everything else. This effectively does what the NCAA states it does, BUT DOESN'T: Enforce a competitive balance by leveling the playing field when it comes to $$$$.

The 'Canes flourished when it was a hard-work, hustle and maximizing your local ties CFB...Money has ruined the sport so much that we are headed to only the huge money programs having a real shot, say 15-17 teams MAX.

Getting the crazy $$$$ out of CFB will save CFB...No E$ECPN is a good thing for the 'Canes.

i'm with you about the money muddying up the waters, but ILCane is 100% right. ESPN failing is not a good thing for sports franchises and colleges. IT may be good for sports consumers but that's to be determined. His above points about the ACC network are absolutely correct. The looming ACC network / incoming cash flow played a factor in our ability to pay $4mil a year for richt. The SEC money likewise played a factor in enlarging the gap b/w college programs and coaching staff salaries, but there is no argument that the ACC money on the whole is beneficial to UM. Having a market player like ESPN (or any market player) drives up the price for ACC sports rights.

Money in sports has hit it's ceiling. If you look at the ridiculous rate at which major sports including CFB and CBB have increased revenue over the last 30 years, you know that it can't keep getting bigger forever. TV money fuels these revenues and with so many households cutting the chord on cable/satellite, the ad money just won't be the same anymore. In the short term, it will still be business as usual but in coming years, these right to broadcast contracts are going to expire and whatever network, be it ESPN, FOX or anybody, will not be bidding nearly as much money for the next contract. It's probably a good thing for college football as it's gotten to the point where only a handful of schools can spend the ridiculous amounts of money required to run a top flight program these days. In ten years, we'll all be saying "remember when they paid college coaches 10 mil a year?" That money isn't going to be there forever.

Wrong on a couple of points.

Coaches salaries will continue to increase.

There is no money "ceiling". That concept is just pulled out of your rear end. Who says there's a money ceiling? You? Quite the opposite if history is to be taken into account. The ESPN model is what's shrinking and out of date. The business and money are still in the system, the distribution models are changing. ESPN either adapts or will continue to see shrinkage of their business.

There is a strong trend towards cord cutting and la cart selection, but the money still exists in the universe and it's not shrinking.

Like traditional taxi companies vs Uber, a more nimble competitor could not only take their lunch but make the pie much bigger, like Uber is doing.

Adapt or become extinct.

have to disagree about coaching salaries. I'm operating on the assumption that there is a "market ceiling" although I think using that phrase confuses the real issue. the pie will indeed keep growing in the long term, but we are talking about an artificially inflated industry. all of the $ (media, ads, rights deals) is what allows schools to pay these coaches higher salaries. the network companies negotiated these rights deals on the assumption that their business models were correct and Subs would continue to grow. that has not actually happens. so if any of these deals came up right now they would likely be for less money. this is based on my assumption in other post that companies like twitter amazon etc don't throw their hat in the ring and keep the market propped up.

i am saying their is a money ceiling so to speak based on my above post about non sports consumers subsidizing the cost for actual sports fans. once the bundle structure finally implodes the money in sports will indeed shrink. there's also a ceiling in the sense that the $ will need to come from other areas outside subscriber fees which is rn the backbone of the industry. even sports fans just aren't willing to pay like they used to b/c there's tons of free alternative like watching at bars, catching clips on twitter, etc. sure the big ticket items like playoff games and stuff are still in demand, but not many ppl can justify paying for ESPN for a handful of games let alone random NBA games on a wednesday. there's a ton of moving parts in terms of the contracts between the networks and the cable company and what each can and cannot do re: streaming / over the top. both the networks and the cable companies will need to adjust their models and we're already heading in the OTT direction. i guess my overall point is that the artificial inflation of $ in sports affecting coaching salaries will ultimately correct itself. at the same time, if the networks can/do fix their biz model then we could get back to the growing pie....i'm not sure how they do so but i'd imagine it starts w/ not paying outrageous fees for useless on air talent, possibly cutting $ allocated to lesser revenue sports like hockey, etc ....

 

[Cane Dynasty]

[MENTION=9161]CaneFan79[/MENTION]...

What has this ACC money done for Miami so far?

No E$ECPN is a good thing for the 'Canes.

You obviously don't know what you're talking about. UM gets $20M a year from ESPN, that's on top of the $12M per year UM gets from Adidas. ESPN is the most important source of revenue keeping us from jumping ship to the SEC.

The SEC would never let Miami in.

 

[DTP]

It's going to be very interesting when all the TV rights deals expire to see how much media outlets are willing to spend on a product that's not returning investment currently. ESPN spent over 7 billion for the CFB playoff rights alone. With drastic drops in ESPN and cable subscribers, advertisers aren't going to pony up the same amounts of cash to sponsor ESPN/cable TV content. The TV contracts are only going to get smaller. That's where a money shortage comes in.

Now, [MENTION=10170]Miamicane[/MENTION] made a good point about expanding broadcasting rights contract to streaming services and other social media outlets. I definitely see that coming into play. However, the reason people are dumping cable/satellite and signing up for streaming services is because it's cheaper and there's less advertising. If Netflix/Amazon all of the sudden started bidding for sports broadcasting rights, they'd have to either raise the price of their service significantly or run lots more advertisements. Probably both. You've got a catch 22 situation. They'd just become the new "cable" and they'd lose subscribers who don't want to pay extra.

Another option would be for each individual sport to try to run their own subscription service. However, it would be really hard to come close to the amount of money they're making from current broadcast rights contracts. Either you have to bank on a hundred million+ paying for your service or you'd have to charge a boatload of money. Are people willing to fork over say $50 a month just to watch NCAA football games? The hardcore fans will but the casual fans (the people who have cut ESPN in the first place) won't.

 

[canestim]

Can't believe they are keeping May and fired Kanell. I know he's an FSU guy but I thought he did a good job. Of course with May they probably don't have to pay him hardly anything because he's worthless.

 

[Miamicane]

^^ thats a great point as well re: what netflix / amazon would have to do if they make a move into this space. totally a catch 22 regarding decision to run more ads or raise prices on the service. i think they could get away w a mix of both assuming ppl would be ok w an extra 5-10$ on their streaming packages. the extra $5 to $10 is a complete guess and is contingent on how their biz model plays out. if they solely focus on live sports games I could see their fixed costs being significantly lower cuz they won't have to pay for all the studio shows - they'd only pay for the games and small team of broadcasters / production costs. in the end i think thats what consumers want/would pay for. they pay a little extra to see big games, can see highlights of all the regular games on internet/ twitter like they do now, and won't have to pay to subside the studio shows they don't watch anyway.

 

[DaveT]

Mark May is technically ABC now, if I recall.

 

[OriginalCanesCanesCanes]

The money is not shrinking. In fact the pie will continue to get bigger. Just because ESPN may not get the lion's share of distribution rights and money in the future, doesn't mean it won't end up somewhere else, in fact, it will. Whether it's Amazon, Twitter, Apple, Netflix, the NCAA itself, or combination thereof there will be another distribution vehicle it just may not be at ESPN or they may have a reduced role. But there is no ceiling in terms of the money right now that I can see.

Only when viewership/interest/ratings are in documented significant decline (like possibly in the NFL) can you make a cogent argument that the money is starting to reach a possible ceiling.

 

[CaneSince4Ever]

[MENTION=10170]Miamicane[/MENTION]...

if they solely focus on live sports games I could see their fixed costs being significantly lower cuz they won't have to pay for all the studio shows - they'd only pay for the games and small team of broadcasters / production costs. in the end i think thats what consumers want/would pay for.

Speak for yourself, I like the 30 for 30 docs & College Gameday. And the money they were paying the folks who got laid off barely made a dent in their budget.

 

[Miamicane]

The money is not shrinking. In fact the pie will continue to get bigger. Just because ESPN may not get the lion's share of distribution rights and money in the future, doesn't mean it won't end up somewhere else, in fact, it will. Whether it's Amazon, Twitter, Apple, Netflix, the NCAA itself, or combination thereof there will be another distribution vehicle it just may not be at ESPN or they may have a reduced role. But there is no ceiling in terms of the money right now that I can see.

Only when viewership/interest/ratings are in documented significant decline (like possibly in the NFL) can you make a cogent argument that the money is starting to reach a possible ceiling.

ya I agree about the money ending up going somewhere else like amazon, twitter, google etc. my above posts were rambling lol but i guess my over point/opinion is that the current money/pie is artificially inflated. the actual pie will indeed keep growing in the long run like other markets u mentioned like transportation services, but imo the current perceived sports "pie" is not reflective of the actual pie/money involved. so i think the market will correct itself a bit until the proper model develops.

of course amazon/twitter may come in w offers based on the perceived pie in which case the bubble will continue. they may very well be able to create a sustainable biz model, but imo i just don't see a sustainable solution where they pay rights based on the current perceived pie

 

[Miamicane]

[MENTION=10170]Miamicane[/MENTION]...

if they solely focus on live sports games I could see their fixed costs being significantly lower cuz they won't have to pay for all the studio shows - they'd only pay for the games and small team of broadcasters / production costs. in the end i think thats what consumers want/would pay for.

Speak for yourself, I like the 30 for 30 docs & College Gameday. And the money they were paying the folks who got laid off barely made a dent in their budget.

i'm with u i like 30 for 30, college gameday, etc and i am a consumer that still pays for it. my opinion was based more on what the average consumer / non sports fanatic would pay for. and i think the evidence of declining subs supports the notion that the average consumer is no longer wiling to pay for the stuff we are willing to pay for.

you're correct about the actual dent. relative to the rights deals, the talent contracts are super insignificant. but the rights deals are concrete obligations that cannot be shed at the moment so in the interim espn is appeasing disney and signaling a shift in their biz model. even when/ if they can negotiate lower rights deals, they were going to have to restructure the bloated on air talent contracts so this was probably more a move to appease disney for the time being

 

[77cane]

How is it they get rid of Kanell and keep Pam Ward doing football games. She is boring and clueless.

 

[DTP]

^ It's definitely the rights deals that are hurting their bottom line but since they can't get out of those, the quickest way to put a bandage on the bleeding is layoffs.

 

[tcgrad1014]

what is ESPN axing their staff i dont get it

They're axing them to get the **** out.

 

[UMFarArcher]

So. ESPN is axing staff right and left.

What are they axing them about?

 

[Handsome Squidbum]

It's going to be very interesting when all the TV rights deals expire to see how much media outlets are willing to spend on a product that's not returning investment currently. ESPN spent over 7 billion for the CFB playoff rights alone. With drastic drops in ESPN and cable subscribers, advertisers aren't going to pony up the same amounts of cash to sponsor ESPN/cable TV content. The TV contracts are only going to get smaller. That's where a money shortage comes in.

Now, [MENTION=10170]Miamicane[/MENTION] made a good point about expanding broadcasting rights contract to streaming services and other social media outlets. I definitely see that coming into play. However, the reason people are dumping cable/satellite and signing up for streaming services is because it's cheaper and there's less advertising. If Netflix/Amazon all of the sudden started bidding for sports broadcasting rights, they'd have to either raise the price of their service significantly or run lots more advertisements. Probably both. You've got a catch 22 situation. They'd just become the new "cable" and they'd lose subscribers who don't want to pay extra.

Another option would be for each individual sport to try to run their own subscription service. However, it would be really hard to come close to the amount of money they're making from current broadcast rights contracts. Either you have to bank on a hundred million+ paying for your service or you'd have to charge a boatload of money. Are people willing to fork over say $50 a month just to watch NCAA football games? The hardcore fans will but the casual fans (the people who have cut ESPN in the first place) won't.

There might be a unique window for conferences that don't have contracts with the major networks to get streaming deals with Amazon, Netflix, Hulu etc. The Power 5 conferences are tied to multi year, billion dollar contracts with broadcast channels but the smaller ones might be able to flip the tables on viewership since more and more people are cordcutters (or do what I do and at most subscribe to Sling or PS Vue only for the 3-4 months of football season to get espn3, then cancel right after).