ESPN is "talking to digital streaming services to offer its network over the Web similar to its current deal as part of Dish’s low-cost bundle Sling," according to Edmund Lee of RE/CODE. ESPN President John Skipper said, "A number of people have expressed interest and we’re in discussions with a large number of people." He added, "Other people will enter into some markets with lighter packages in this calendar year." Lee noted Skipper did not cite "which specific services could start including ESPN, such as Amazon or Apple." ESPN will "only be offered if it is included as part of a larger bundle of Disney channels in more of these so-called skinny bundles going forward." The key in any of these deals is that "as far as ESPN is concerned it won’t be sold as a standalone channel the way HBO does with HBO Now." Skipper: "We do not believe it right now to be good business." Meanwhile, Skipper said that ESPN is "already seeing larger audiences when it adds its mobile and digital consumers, which means they can charge more for ad rates" (RECODE.net, 2/17). Skipper later reiterated the "imminent predominance of content that people consume on television or the video they consume is going to be in a pay television bundle ... for the foreseeable future." Skipper: "We have authenticated television, all of our content is available on any device. The idea of going direct to the consumer with that contend is not the way for to us drive the most value right now." He added ESPN is "interested in pursuing opportunities in over-the-top -- and have already. We sold the World Cup of Cricket last year over-the-top. We generated 100,000 subscriptions at $100 apiece, so we know how to do it. We'll continue to look for other opportunities for content that does not exist on our current linear network to put over-the-top” ("Squawk Box," CNBC, 2/18).
POSITIVE OUTLOOK: Skipper said that ESPN "just had the best year in the history of the company," and its collection of sports rights and digital assets will "lead to steady growth in advertising sales and affiliate fees, outpacing the growing cost of sports rights." Skipper: "ESPN is not a drag on the Walt Disney Company." He added that it "wouldn’t make sense to sell ESPN programs directly to consumers over the Internet." Skipper: "There are lots of people who want ESPN, and it's our task to figure out how to get packages to ESPN that work for them" (BLOOMBERG NEWS, 2/18).
