ESPN tries to get with a mobile, app-driven world
BRISTOL, Conn. — If ESPN were to be started from scratch today, it would probably not look much like the ESPN everybody knows.
The company might not have eight television channels, especially not ones with incongruent names — like ESPN News, which shows radio simulcasts and reruns but offers little news.
There would not be an outdated channel like ESPN Classic, which YouTube superseded a decade ago.
Instead, it would probably look a lot like ESPN+ and the updated ESPN app, a bundle that is launching Thursday to the millions of people who had previously downloaded the app. ESPN+, the company’s long-awaited sports streaming service, will feature thousands of live games and original programming for $4.99 a month, and will live inside the ESPN app.
ESPN+ is ESPN’s most important product launch in years. The company has struggled to stem the continuing loss of subscribers to cord-cutting and needs digital services to succeed to maintain the same level of vitality with the next generation of sports fans that it has with the current one.
If successful, ESPN+ and the ESPN app could define the network in this era, just as
SportsCenter did in the 1990s and early 2000s, becoming an essential hub for obsessive sports fans. If they are not, the company will have to continue to rely on what is likely to be a shrinking market for pay television.
“We believe that we have an opportunity to now serve sports fans in new and innovative ways, in ways that, quite honestly, no one else really can,” Jimmy Pitaro, ESPN’s president, said at a media event at ESPN’s headquarters here last week.
Doug Creutz, a media analyst at Cowen, said it was not important for ESPN+ to generate revenue in the near term. Rather, it should serve as a safety net in case the traditional cable bundle continues to collapse. “The economic pressure that all these guys are finding on this model, it is kind of a slow drip,” he said. “It is not catastrophic collapse. It is death by a thousand cuts.”
He added that ESPN did not have a long history of new prod-
uct launches, besides new channels, because it has not had to. “It has been a really simple business to run for a long time,” he said. “It has gotten complicated recently, so they are trying some new things.”
The current ESPN app prioritizes scores, news and highlights, and also has a tab for cable television subscribers to watch ESPN.
The new app will essentially contain three better integrated parts: news and scores, live events and shows that are on ESPN’s television channels, and ESPN+. “This is essentially a three-in-one service,” Pitaro said.
The ESPN app has been downloaded 70 million times and has 2 million daily active users, according to Apptopia, an app analytics company. It regularly ranks as the most downloaded sports app.
ESPN wants to use the integrated app to drive ESPN+ subscriptions.
If you are browsing New York Yankees scores in the app and a Yankees game is live on an ESPN channel or ESPN+, a banner will alert you that the game is available to watch. If you have entered your cable subscription information or subscribed to ESPN+, you will go straight to the game. If not, you will be prompted to enter your information or to subscribe to ESPN+.
The app was built by both BamTech, the Major League Baseball Advanced Media spinoff that Disney, ESPN’s parent company, bought a 75 percent stake in for $2.58 billion in 2017, and ESPN’s core technology team in Bristol.
At $4.99, ESPN+ is cheaper than other streaming services, but has one enormous drawback: It will not show anything available on ESPN’s television channels. That means no Monday Night Football, no NBA games, no Sunday Night Baseball and few Power Five conference football and basketball games.
For those options you will still need to have a cable subscription.
Fewer than 87 million people currently subscribe to a television package with ESPN, compared with more than 100 million in 2011, according to Nielsen. The company knows that its television audience is declining and that streaming video is the future, but television remains a cash cow that generates billions of dollars in revenue annually. ESPN collects about $8 per month for each subscriber from pay television companies that carry the network, according to Kagan, the media research firm.
Executives say ESPN+ is designed not to cannibalize the television business.
“This application, this service, this will all be complementary,” Pitaro said.
ESPN believes there are three types of customers who will subscribe to ESPN+. There is the sports fanatic who wants access to everything; the fan of many niche sports that ESPN+ will have rights to, like rugby and cricket; and alumni and fans of non-Power 5 colleges.
ESPN will show more than 10,000 games on ESPN+. The network has the rights to thousands of college events, as well as tennis, golf and lower-level soccer matches that never appear on television. Those events will now find a home on ESPN+. Agreements with the NHL and Major League Baseball call for ESPN to stream a daily game, and the company has streaming deals with the Sun Belt Conference and the Ivy League, as well Major League Soccer and the United Soccer League, among many others.
ESPN also hopes that exclusive, original programming will be a draw. The entire library of 30 for 30 sports documentaries will be available to stream at any time, and The Last Days of Knight, about former ESPN commentator Bob Knight’s dismissal as Indiana’s basketball coach, will be available only on ESPN+. It will also stream new programs like Draft Academy, a look at NFL prospects in advance of the draft, and Details, a basketball analysis program hosted by Kobe Bryant.
Executives declined to state their goals or expectations for ESPN+ other than to say they wanted to expand the network’s reach and continue “delighting” fans. There are no current plans to introduce price tiers to ESPN+ or to allow customers to buy television channels through it.
Disney is in the process of buying 22 regional sports networks from Twenty-First Century Fox. If that deal goes through, some content owned by those channels may also become available through ESPN+.
For Pitaro, who took over ESPN in March after John Skipper resigned in December to address what he has described as a cocaine problem, ESPN+ may become a litmus test for his first months on the job. Pitaro’s other big debut, the morning show Get Up, is struggling to gain traction.
At ESPN’s upfronts last May, the company announced Get Up, which finally made its debut last week. Hosted by Mike Greenberg, Michelle Beadle and Jalen Rose, it is a lighthearted sports version of a traditional morning show, with some segments remaining from the SportsCenter programs that are traditionally shown from 7 to 10 a.m.