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Disney's Iger Discusses ESPN Subscription Losses, BAM Tech Stake, NFL Stadium Bid

Disney Chair & CEO BOB IGER was recently named Variety's '16 "Showman of the Year," though his tenure has "not been without its challenges," according to a Q&A with James Rainey of VARIETY. ESPN has "seen subscriptions shrink, as younger viewers 'cut the cord' with traditional cable, buy lower-cost cable packages, or find content online." More than 10 million subscribers have "fled ESPN in the past five years." No matter how many "movie hits or theme park attendance records, Iger routinely gets grilled about how he will stanch the bleeding at ESPN." His answer has been to "explore solutions through technology," including the $1B, 33% stake in BAM Tech, which will "collaborate with ESPN on multi-sport subscription streaming services." Below are excerpts from the Q&A, some of which have been edited for brevity.

Q: The entertainment industry is confronting an existential challenge: How to move content to the Internet and mobile devices while still making money. How is Disney responding?
Iger: We know that there is disruption afoot in our business. And what we’re trying to do is figure out how to contend with that disruption. The one thing we’re not trying to do is will it away. It’s not going away.

Q: For the last couple of years, that issue has been particularly pressing at ESPN, which has been losing millions of cable subscribers. How does Disney’s $1B investment for a one-third stake in BAM Tech bolster one of your most important money-makers?
Iger: We’re investing in BAM Tech as a means of having the technological capability to create a user-face and a platform to sell our stuff directly to consumers, because there’s an inevitability to that for this company.

Q: Some people have been thinking this new streaming service will offer a flat rate, roughly the $6 or $7 a month that customers pay on their cable bill to get ESPN. Is that right?
Iger: It’s not going to be that way at all. There will be really variable pricing and multiple packages to consumers. People may just want to subscribe during the football season. Or maybe they want to pay just for a summer, just for a weekend, just for a game. We will have customization and personalization. I think everything ultimately will be on an à la carte basis; a lot of people may subscribe to the whole thing. 

Q: Your group bidding to build an NFL stadium in Carson lost out this year to the proposal for an Inglewood stadium for the Rams. Are you looking for another way in to get into professional sports?
Iger: I’m not pursuing anything. There is no list. I’m not talking to people. There’s a world out there. There’s a life to lead. My life is full of possibilities and satisfying other curiosities and smelling roses and relaxing a bit. ... By the way, I am not suggesting [the transition into retirement] won’t be hard. It will be hard (VARIETY, 11/22 issue). 

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