ESPN and the Cord Cutting Culture

[Mavric]

Which brings us to today. ESPN is hemorrhaging subscribers and money. In a November regulatory filing, the network revealed that it has lost seven million subscribers over the past two years. While every popular TV channel has lost subscribers, the losses for ESPN and ESPN2 are among of the highest in the industry—and the most costly. Here is a graph showing subscriber losses from July 2011 to July 2015 for 15 of the most popular cable channels: *graphic below

 

ESPN is, like everybody, being dropped by cord cutters, but it’s also disproportionately affected by people trading down to packages that don’t contain ESPN or ESPN2. Now that the skinny bundles Rasulo laughed at four years ago are actively hurting the company, though, ESPN is asserting that the damage actually isn’t as bad as it looks. Here’s a revealing exchange from an interview with ESPN president John Skipper, published the other day by the Wall Street Journal:

 

WSJ: What has been the biggest reason for ESPN’s subscriber declines?

 

Mr. Skipper: People trading down to lighter cable packages. That impact hasn’t leaked into ad revenue, nor has it leaked into ratings. The people who’ve traded down have tended to not be sports fans, and have tended to be older and less affluent. We still see people coming into pay TV. It remains the widest spread household service in the country after heat and electricity.

 

Deadspin

 

[84HuskerLaw]

These numbers and the overall indication of people cutting the cord to the pay TV services should not be surprising. It is obvious for several reasons including the continuing decline in the standard of living for most 'average' folks. Declining employment, lower wages despite inflation ravaging the purchasing power of the working poor. We've seen the numbers of working poor jump radically with welfare rolls increasing almost 50% over the past 7 years to nearly 50 million households. Cable and dish TV and internet packages have gone up considerably while incomes are down. Financially, it is simply not worth the cost to more and more people. The number of househlds with a working TV set have actually been dropping for about a decade. This is due to cost but also due to poor programming generally. TV programs are just not very good. You see the increase in the so called 'reality' shows which are so cheaply put together with unpaid or minimal acting and no scripts, etc.

 

Frankly, are there any really good quality programs on the basic networks anymore? I hardly watch TV myself because there is so little on and so many bad commercials, repeated throughout the day. Boredom will set in within a couple hours and after scanning through 'hundreds of channels' with 'nothing' on, why pay for it?