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Author Topic: Is ESPN In Trouble (cord-cutter)  (Read 25973 times)

jficke13

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Re: Is ESPN In Trouble (cord-cutter)
« Reply #25 on: August 21, 2015, 08:40:41 AM »
DIS is overvalued.  Motley Fool has been selling its "four secret stocks to buy" report - which includes DIS - for a couple years now.  A lot of people buying the dream... but it's no more rational than people who buy lottery tickets to get rich.

The problem is, no one can come out and say it because Disney is still a corporate juggernaut and has the revenues to show for it.  The real issue is that they have too many eggs in the media/entertainment sector, which is going through a major evolution in consumer demand right now... if the cord-cutting fad becomes fashion, the mouse is in serious trouble.

ESPN is just one (of many) revenue streams for DIS. I don't own any, but would consider opening a position for the right price because Disney has a demonstrated ability to cultivate billion dollar brands and keeps on adding to them (Marvel, Star Wars). If cord cutting is inevitable, ESPN will adapt or die. DIS will reallocate its capital to other more profitable ventures. The mouse is going nowhere long term.

Benny B

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Re: Is ESPN In Trouble (cord-cutter)
« Reply #26 on: August 21, 2015, 10:01:54 AM »
ESPN is just one (of many) revenue streams for DIS. I don't own any, but would consider opening a position for the right price because Disney has a demonstrated ability to cultivate billion dollar brands and keeps on adding to them (Marvel, Star Wars). If cord cutting is inevitable, ESPN will adapt or die. DIS will reallocate its capital to other more profitable ventures. The mouse is going nowhere long term.

Let's be honest.... First off, ESPN is the mouse's revenue stream.  Disney paid a lot of money for those other properties so while it might be a few years before they see any ROI there, they really don't have the luxury of time right now.

Second, ESPN is already on the front lines when it comes to adapting; that's why ESPN3 and WatchESPN were invented.  The problem there is that we've seen the numbers from Chicos and the pundits (not a band) saying that monthly ESPN fees would have to be $30-80 PER MONTH to make up for lost revenue in most simulations; those models consider the supply/demand at the price, but they don't contemplate the socio-economics of the consumer demand.  $30/month doesn't seem like it's going to go over very well with the NASCAR demographic who makes up the wide majority of cable TV's - and ESPN's - constituency unless their $150/month cable bills go away.... in which case, Bubba's still going to be pretty pissed when he and his kin have to pay $30 for ESPN & $20 for the SEC Network, when his package of CMT, TruTV, A&E, CMT-2,  NASCAR Network, Animal Planet, TLC, CMT-Ocho, and Lifetime (cause momma's gotta watch her stories) is only $15.

Third, Disney is already reallocating capital to profitable ventures like Disney Interactive.  Whoopsie daisy.  You see, corporate behemoths like Disney are slow to adapt to evolution in consumer demand... they make their money on driving consumer demand, i.e. telling people what they want, so when their customers don't respond the way they expect (or tell) them to, they get flustered.  So either they try to adapt, which seems like it works for a while, but ultimately end up screwing the pooch (like DI) or they end up buying companies that are several steps ahead of them already (see: Pixar) in order to get some semblance of momentum back... which is fine when you have a huge revenue stream to fall back upon (whoopsie daisy, again) and/or there's no other viable competition, which brings me to point four:

In fifteen years, try to explain to your kids how Google got its start.  "Search engine?  Is that how our driverless cars find each other, daddy?"  It's no secret that Google and Apple are not only making inroads into media/entertainment -- they already have -- but have their eyes set on something much larger.  They're already a decade or two ahead of Disney on this front... another mouse business unit supposedly adapting to change, Disney Movies Everywhere, isn't even being powered by Disney.  Because Disney already failed on their own in that attempt.  DME is basically a licensee of iTunes (though some may argue iTunes is licensing Disney, Apple had the upper-hand in those negotiations).  They're partnering with a competitor, just like they did with the aforementioned Pixar, but the difference this time around is that Disney isn't the 800 lb. gorilla in that relationship... Disney couldn't acquire Apple if it tried, and Apple doesn't need to acquire Disney.  The sad thing is that some Disney execs have compared their relationship with Apple on DME to dating Charlie Sheen... sure, it's great for publicity and you're raking in the dough right now, but even if you can say you're in love, everyone knows where this is going long term.  If Walt made it to heaven, he probably only got there a few years ago because Steve Jobs requested a butler (rumor is the iPad has made processing new arrivals a hell of a lot easier for St. Peter, so he was happy to oblige).  In short, Disney has competition now, which is nothing new to them, generally speaking; however, those competitors are no longer the mom & pop shops and startups, that when they become too threatening, you can simply go in and exploit them.

Lastly... as with any investment, if your basis is low, then you're fine.  If you bought DIS for $15 back in early 2003, you're dancing.  If you bought them at $120 a couple weeks ago, you're screwed.  But the real winners are going to be those who ponied up the likes of $20 for Amazon or the price of a standard Duke brothers wager for Apple instead.
Wow, I'm very concerned for Benny.  Being able to mimic Myron Medcalf's writing so closely implies an oncoming case of dementia.

Dr. Blackheart

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Re: Is ESPN In Trouble (cord-cutter)
« Reply #27 on: August 21, 2015, 09:24:00 PM »
I just looked at my Disney stuff.  All time, I'm up 212.67% on what I paid for it.  I'm feeling pretty good about it.  I have a few stinkers, a few winners.

Even more reason to start selling off.  If you are up in Blackjack, do you walk away as you start losing or do you wait until all your winnings are gone?  Start selling off to profit take and buy your land in Montana.

Tugg Speedman

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Re: Is ESPN In Trouble (cord-cutter)
« Reply #28 on: August 21, 2015, 10:00:09 PM »
Even more reason to start selling off.  If you are up in Blackjack, do you walk away as you start losing or do you wait until all your winnings are gone?  Start selling off to profit take and buy your land in Montana.

+1

How far does Disney have to go down before you think the market is telling you something you should listen too?

MU82

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Re: Is ESPN In Trouble (cord-cutter)
« Reply #29 on: August 21, 2015, 10:48:13 PM »
DIS at under $92, which is about 18x 2015 earnings estimates, would be an extremely attractive entry point IMHO. That's where my limit order is -- 91 and change.

DIS is a classic "want to" stock for me. I don't "need" to own it to realize my financial goals. But it is a fantastic company with a future of limitless potential and I would be happy to own it for decades to come if I can get it at what I consider a bargain price.
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Tugg Speedman

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Re: Is ESPN In Trouble (cord-cutter)
« Reply #30 on: August 22, 2015, 12:14:11 AM »
DIS at under $92, which is about 18x 2015 earnings estimates, would be an extremely attractive entry point IMHO. That's where my limit order is -- 91 and change.

DIS is a classic "want to" stock for me. I don't "need" to own it to realize my financial goals. But it is a fantastic company with a future of limitless potential and I would be happy to own it for decades to come if I can get it at what I consider a bargain price.

Take a look at 2016 earnings estimates.  They were $5.72 on August 4th.  Today they are $5.58 and the latest earnings estimates are coming in closer to $5.50.  That is a big move in that short period of time and it is due to the reassessment of cable subscriptions at ESPN (FYI, ESPN is about a third of Disney earnings).

The crown jewel that drives Disney earnings is ESPN.  Iger had near monopoly pricing.  With that potentially gone, everything changes.  As explained a few posts above

------------------------

Now Sanford C. Bernstein analyst Todd Juenger and his team have a big message for the media industry: Everything has changed. In a note sent out this morning, Juenger not only downgrades Disney and Time Warner; he also says analysts need to change the way they think about valuing this industry all together, as both of the industry's major revenue streams—pay subscribers and advertisers—are in jeopardy.

Where the stocks/sector have traded historically is irrelevant. The world has changed too much. Where the stocks are currently trading may or may not be appropriate – but why?… We have come to believe the affiliate fee revenue stream deserves a higher risk premium than it did before. The question of whether pay-tv sub declines are accelerating is only a question of 'over what time frame?'


-----------------------------

An 18 PE was the old world that ended on August 4.  Today's new (cord--cutting) world might be an under 15 forward PE ... on a lower earnings estimate. 

Change your buy order to $75 to $80.

« Last Edit: August 22, 2015, 08:39:24 AM by Heisenberg »

ChicosBailBonds

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Star Wars tickets go on sale tomorrow, 2 months ahead of the movie release
« Reply #31 on: October 18, 2015, 11:55:52 PM »
They are going to print money for this thing.  Brilliant move.  Sell all the tickets now before anyone hears if it is good, bad, or indifferent.  Book it in advance.

Next trailer out tomorrow night with Monday Night Football...also a Disney property.


chapman

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Re: Is ESPN In Trouble (cord-cutter)
« Reply #32 on: October 29, 2015, 08:20:38 PM »
Buy buy buy

Back over $115.  Only need to go to Target...or your grocery store...or the pet store to see which division's earnings projections were terribly understated.

ChicosBailBonds

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Re: Is ESPN In Trouble (cord-cutter)
« Reply #33 on: October 29, 2015, 10:59:31 PM »
Back over $115.  Only need to go to Target...or your grocery store...or the pet store to see which division's earnings projections were terribly understated.

Yup, like taking candy from a baby.

Tugg Speedman

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Re: Is ESPN In Trouble (cord-cutter)
« Reply #34 on: October 30, 2015, 12:37:51 PM »
Yup, like taking candy from a baby.

Page 1 you said bought on August 5.  Price was $112 on August 5.  August 24 it was $90.  Today it is $114.

This is what you defined as taking candy from a baby?  Suffering through a $22 loss only to make $2 and then brag about it?


The Lens

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Re: Is ESPN In Trouble (cord-cutter)
« Reply #35 on: October 30, 2015, 01:59:31 PM »
Grantland is no more.  I was a faithful reader but it seemed like more of a vanity / cocktail party play...never to be a huge revenue driver.
Marquette, we always win the post-game.

brandx

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Re: Is ESPN In Trouble (cord-cutter)
« Reply #36 on: October 30, 2015, 02:10:22 PM »
Grantland is no more.  I was a faithful reader but it seemed like more of a vanity / cocktail party play...never to be a huge revenue driver.

For all of ESPN's good business practices, this was a failure for ESPN to properly monetize their product.

First off, there was the personality conflict (jealousy) with Simmons. At one point, he was the highest paid ESPN employee. With changes in some top management offices, that caused problems.

Second, Grantland wasn't a money maker because of eSPN mismanagement. Annual ad revenue for Grantland was about $6 mil a year, including the Web site and a Simmons podcast; since his departure from ESPN, Simmons has rolled out his own (and his owned) podcast, which, is probably worth north of $5 million in yearly revenue alone. So, Simmons is now making for himself roughly the same as Grantland’s entire annual ad-sales revenue.

ChicosBailBonds

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Re: Is ESPN In Trouble (cord-cutter)
« Reply #37 on: October 30, 2015, 04:39:00 PM »
Page 1 you said bought on August 5.  Price was $112 on August 5.  August 24 it was $90.  Today it is $114.

This is what you defined as taking candy from a baby?  Suffering through a $22 loss only to make $2 and then brag about it?

I bought three times in three weeks and I believe stated I was buying again and again, all the way down.  It worked out and was easy money.  Just like GM and C during the bailout. 

As a former Walt Disney employee I have a lot of faith in how they operate their businesses for the most part.  ESPN is the area of concern, but not for the reasons you cited.  It isn't cord cutting doing the real damage, it is cord shaving which I described here on several occasions over the years.

That's what has them in a tight spot right now.  Two friends of mine were let go last week, so it is a tough situation.

So yes, knowing the company and what they do, I was confident and why I said multiple times to buy buy buy.  If I said it at $110, I certainly kept saying it as it got cheaper.  Easy money when you consider their broader portfolio and especially with Star Wars about to come out.


Tugg Speedman

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Re: Is ESPN In Trouble (cord-cutter)
« Reply #38 on: October 30, 2015, 04:50:57 PM »
I bought three times in three weeks and I believe stated I was buying again and again, all the way down.  It worked out and was easy money.  Just like GM and C during the bailout. 

As a former Walt Disney employee I have a lot of faith in how they operate their businesses for the most part.  ESPN is the area of concern, but not for the reasons you cited.  It isn't cord cutting doing the real damage, it is cord shaving which I described here on several occasions over the years.

That's what has them in a tight spot right now.  Two friends of mine were let go last week, so it is a tough situation.

So yes, knowing the company and what they do, I was confident and why I said multiple times to buy buy buy.  If I said it at $110, I certainly kept saying it as it got cheaper.  Easy money when you consider their broader portfolio and especially with Star Wars about to come out.



C lost 96% of its value all the way down into 2009.   Yet you managed to buy the low, but not 70% before the low, but the absolute low after a three-year relentless decline, and make money???? 

Like GM they were both going out of business and only survive because of government bailouts. You make money because of socialism.

Since you're that good at market timing, when will we see the announcement for the Chico Bail Bonds school of Business at Marquette University?

ChicosBailBonds

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Re: Is ESPN In Trouble (cord-cutter)
« Reply #39 on: October 30, 2015, 11:25:01 PM »
You lost $10 bucks a share when you bought Disney a week ago.  Meanwhile, AT&T going sideways down.  Sell, sell, sell. I will listen to Heise since he built The Al.

http://www.marketwatch.com/investing/stock/t

Nope, I made out quite well, all three times I bought.   :D

ChicosBailBonds

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Re: Is ESPN In Trouble (cord-cutter)
« Reply #40 on: October 30, 2015, 11:30:45 PM »
C lost 96% of its value all the way down into 2009.   Yet you managed to buy the low, but not 70% before the low, but the absolute low after a three-year relentless decline, and make money???? 

Like GM they were both going out of business and only survive because of government bailouts. You make money because of socialism.

Since you're that good at market timing, when will we see the announcement for the Chico Bail Bonds school of Business at Marquette University?

I make money based on common sense and market realities.  I abhor the bailouts that Bush started and Obama completed, but that doesn't make me stupid not to pounce on them.  No way the gov't was going to let GM or C fail.  That's the opportunity.

This is why a few weeks ago I told you August 5th to buy, August 16th to buy, August 20th to buy, etc.

 ;)

You have to look at the bigger picture, not the micro story in my opinion.   When all the Sony stuff was hitting the fan, I bought Sony.  If you think it is a blip and the company over the longhaul is likely to overcome, go for it.  Now, if they have a fundamental massive problem that has no shot, then stay the hell away for obvious reasons.  I don't believe in legalizing pot, but I know its going to happen.  Thinking about buying some marijuana stocks now to get ahead of the 10 year run up when it is legalized.  Healthcare, very much staying in that for the longhaul....so on and so forth.

Tugg Speedman

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Re: Is ESPN In Trouble (cord-cutter)
« Reply #41 on: October 31, 2015, 06:32:08 AM »
I make money based on common sense and market realities.  I abhor the bailouts that Bush started and Obama completed, but that doesn't make me stupid not to pounce on them.  No way the gov't was going to let GM or C fail.  That's the opportunity.

This is why a few weeks ago I told you August 5th to buy, August 16th to buy, August 20th to buy, etc.

 ;)

You have to look at the bigger picture, not the micro story in my opinion.   When all the Sony stuff was hitting the fan, I bought Sony.  If you think it is a blip and the company over the longhaul is likely to overcome, go for it.  Now, if they have a fundamental massive problem that has no shot, then stay the hell away for obvious reasons.  I don't believe in legalizing pot, but I know its going to happen.  Thinking about buying some marijuana stocks now to get ahead of the 10 year run up when it is legalized.  Healthcare, very much staying in that for the longhaul....so on and so forth.

Citibank (C) ....

It peaked on December 29, 2006 at $570 (no typo!)
March 6, 2009 it bottomed at $9.70 (no typo!)
Today it is at $53 (No typo)

So you bought when it was going down.  You did not buy at $500 or $400 or $300 or $200 or $100 or even $50.  No, you knew it was going all the way from $570 to $9.70 and bought that low and made money.

When C got its first bailout (Sep 2008) it was $250, you did not buy.  When C received its second bailout in Nov 2008 it was $150 but you did not buy.  You knew that even after the second bailout the stock was still going down another 70% to $9.70 before it bottomed.  Then you bought.

I know Michael Lewis who wrote the Blind Side, Liars Poker, the Big Short and Flash Boys.  He is looking for another topic.  Maye I can put him in touch with you ... "Chicos Bail Bonds, The Greatest Market Timer The World Has Ever Seen"
« Last Edit: October 31, 2015, 06:54:34 AM by Heisenberg »

Tugg Speedman

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Re: Is ESPN In Trouble (cord-cutter)
« Reply #42 on: October 31, 2015, 06:53:39 AM »
I make money based on common sense and market realities.  I abhor the bailouts that Bush started and Obama completed, but that doesn't make me stupid not to pounce on them.  No way the gov't was going to let GM or C fail.  That's the opportunity.

This is why a few weeks ago I told you August 5th to buy, August 16th to buy, August 20th to buy, etc.

You do realize that GM filed for bankruptcy in 2009.  That means that the stock went to ZERO(!) and the Government took them over (nationalized them).  So anyone that said the Government was going to bail them out lost 100% of their investment.  Not 99% but 100%.  The company you claimed to have bought and made money does not exist anymore.

The current stock called GM is a complete new company with no ties to the previous company and was IPO'ed (Initial Public Offering) on November 17, 2010 at $33.  Yesterday it closed at $34.  No one has made money on it in the five years it has existed ... except for the world's greatest market timers.

To be clear, you concluded in 2008 it was a buy but you waited until the stock went to zero first, then wait two more years for the IPO, then waited another 18 months after the IPO when it slumped to $20 in 2011 and 2012, and then you finally bought.  So today at $34 you're sitting with a nice profit.  (Incidentally the Government took the company at an average price of $44 and sold it at $33 and lower so it lost a ton of money on it.)

Why are your wasting you time in the Cable/Sat TV industry.  You should be on Wall Street making billions.
« Last Edit: October 31, 2015, 11:35:29 AM by Heisenberg »

ChicosBailBonds

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Re: Is ESPN In Trouble (cord-cutter)
« Reply #43 on: October 31, 2015, 01:07:39 PM »
You do realize that GM filed for bankruptcy in 2009.  That means that the stock went to ZERO(!) and the Government took them over (nationalized them).  So anyone that said the Government was going to bail them out lost 100% of their investment.  Not 99% but 100%.  The company you claimed to have bought and made money does not exist anymore.

The current stock called GM is a complete new company with no ties to the previous company and was IPO'ed (Initial Public Offering) on November 17, 2010 at $33.  Yesterday it closed at $34.  No one has made money on it in the five years it has existed ... except for the world's greatest market timers.

To be clear, you concluded in 2008 it was a buy but you waited until the stock went to zero first, then wait two more years for the IPO, then waited another 18 months after the IPO when it slumped to $20 in 2011 and 2012, and then you finally bought.  So today at $34 you're sitting with a nice profit.  (Incidentally the Government took the company at an average price of $44 and sold it at $33 and lower so it lost a ton of money on it.)

Why are your wasting you time in the Cable/Sat TV industry.  You should be on Wall Street making billions.

I think you may want to go back and read what I said....you are jumping to a few conclusions, probably because I didn't articulate it well.

First off, I'm in the digital entertainment industry...with specialties in Sports, satellite, digital over the top, television, digital entertainment (music, video, etc.)  To make billions, you need huge amounts of money to make those bets, you should know this.  You won't win a lot of money at the $5 black jack table, even if you are winning most hands.

Now, back to what I said.   I knew the gov't wasn't going to allow GM, C and others fail.  You'll have to show me where I said I invested in GM pre bankruptcy?  I didn't say that.  My point was that once they reorganized, they were going to prop up the company which of course they did.   Incidentally, you are mostly right about GM shares pre bankruptcy, but not entirely.  They did go to Motor Liquidation for a time, but certainly an investment prior to that would have been full hardy.  I just wish I had gotten into Ford at the time.   My first job out of college was three years in the automotive industry working with Ford, GM, Cummins, etc, on engine oil testing platforms.  Ford came out of great recession without taking federal money and did it right.  I would have liked to have jumped on that, but didn't.

As for C, now there I did jump on but not until 2009.  I just looked it up.  On March 13, 2009 at $1.799904 per share is when I jumped in.  I did not think the gov't was going to let another major financial institution "fail".  Even though personally I think way more of these firms and others should have gone into bankruptcy. 

Some of my choices are lucky  (Facebook at $18.75, SNE at $16.88, DIS at $24.23  :D), some not so lucky.  I have my share of stinkers, but I've been more pleased than not over the years. 


Tugg Speedman

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Re: Is ESPN In Trouble (cord-cutter)
« Reply #44 on: November 27, 2015, 10:21:30 AM »
ESPN reported today that it has lost 7 million subscribers in the last two years.  It now has 92 million subscribers, a 10 year low.

http://www.marketwatch.com/story/disney-is-losing-espn-subscribers-by-the-millions-2015-11-26

This is a far steeper rate than most thought (shocking rate according to some) and not close to ending.  Most analyst think is ESPN is "done" and will struggle with a bloated cost structure, continuing loss of subscribers and turmoil for many more years.

These same analysts like Disney stock because Bob Iger (Disney CEO) is a brilliant manager and he knows ESPN is "done" and repositioning himself away from ESPN and toward other Disney Properties (Star Wars and theme parks).

Disney's stock is down 4% today to $113.

Could the Big East have made a brilliant move getting away from ESPN and it's insanely high cost structure that will lead to massive changes and cost structure in the future?  In a few years Fox Sports might look like a better option compared to the explosion about to happen in Bristol.

And was the Big East brilliant in signing a 12 year deal at the high?  It has an overvalued cash flow stream for another 10 years.  Good luck to the ACC and the NFL when their deals are up and they find out they are not worth what they thought.
« Last Edit: November 27, 2015, 10:24:51 AM by Heisenberg »

ChicosBailBonds

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Re: Is ESPN In Trouble (cord-cutter)
« Reply #45 on: November 27, 2015, 12:16:17 PM »
ESPN reported today that it has lost 7 million subscribers in the last two years.  It now has 92 million subscribers, a 10 year low.

http://www.marketwatch.com/story/disney-is-losing-espn-subscribers-by-the-millions-2015-11-26

This is a far steeper rate than most thought (shocking rate according to some) and not close to ending.  Most analyst think is ESPN is "done" and will struggle with a bloated cost structure, continuing loss of subscribers and turmoil for many more years.

These same analysts like Disney stock because Bob Iger (Disney CEO) is a brilliant manager and he knows ESPN is "done" and repositioning himself away from ESPN and toward other Disney Properties (Star Wars and theme parks).

Disney's stock is down 4% today to $113.

Could the Big East have made a brilliant move getting away from ESPN and it's insanely high cost structure that will lead to massive changes and cost structure in the future?  In a few years Fox Sports might look like a better option compared to the explosion about to happen in Bristol.

And was the Big East brilliant in signing a 12 year deal at the high?  It has an overvalued cash flow stream for another 10 years.  Good luck to the ACC and the NFL when their deals are up and they find out they are not worth what they thought.

LOL

How it is shocking to some when little old me told you this 2 and 3 years ago?  If any analyst said this, they should be fired for incompetence.   When we instituted skinny packages at DIRECTV it was with the SOLE PURPOSE of taking out sports content because it was so expensive.  We created SELECT package to do that for that purpose.  Disney knew exactly what it meant.  To get the higher rate they wanted, they had to give on the penetration numbers.

THAT, is what people are missing here.  There was always 50 to 60% of people that don't give two squirts about sports and never wanted ESPN to begin with, but DISNEY forced all the MVPDS (cable, telco, satellite) to penetrate Disney in all of their packages.  When they did that, it kept raising the costs of programming so much that distributors had to raise prices every year to customers to keep pace.  This is not just a Disney thing, but they are the biggest influencer on the cost side.   As a result, skinny packages were introduced by DIRECTV and Comcast, and others followed suit soon thereafter.  As a result, Disney loses subscribers, easily forecast BUT they were made whole by the dollar rate per sub they have.

As for your ACC and NFL comments.....I'll bet a year of my salary that the next NFL deal will be gangbusters in the early 2020's and will far exceed what the current ones do.  ACC will also make out very well.  Right now, ESPN overspent, but they are still making a ton of money which most people apparently want to ignore.  They downsized because they want to maintain their profit margins for overspending on the NFL and other properties.  That's their mistake on the spend, but this is hardly an organization hurting in the pocketbook.  I have a ton of friends at ESPN at the executive level, and they are doing just fine and will be for many many many years to come.  They will do special rates, if I had to guess, in the mobile space and monetize in the skinny packages as well.

Tugg Speedman

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Re: Is ESPN In Trouble (cord-cutter)
« Reply #46 on: November 27, 2015, 03:40:59 PM »
LOL

How it is shocking to some when little old me told you this 2 and 3 years ago?  If any analyst said this, they should be fired for incompetence.   When we instituted skinny packages at DIRECTV it was with the SOLE PURPOSE of taking out sports content because it was so expensive.  We created SELECT package to do that for that purpose.  Disney knew exactly what it meant.  To get the higher rate they wanted, they had to give on the penetration numbers.

THAT, is what people are missing here.  There was always 50 to 60% of people that don't give two squirts about sports and never wanted ESPN to begin with, but DISNEY forced all the MVPDS (cable, telco, satellite) to penetrate Disney in all of their packages.  When they did that, it kept raising the costs of programming so much that distributors had to raise prices every year to customers to keep pace.  This is not just a Disney thing, but they are the biggest influencer on the cost side.   As a result, skinny packages were introduced by DIRECTV and Comcast, and others followed suit soon thereafter.  As a result, Disney loses subscribers, easily forecast BUT they were made whole by the dollar rate per sub they have.

As for your ACC and NFL comments.....I'll bet a year of my salary that the next NFL deal will be gangbusters in the early 2020's and will far exceed what the current ones do.  ACC will also make out very well.  Right now, ESPN overspent, but they are still making a ton of money which most people apparently want to ignore.  They downsized because they want to maintain their profit margins for overspending on the NFL and other properties.  That's their mistake on the spend, but this is hardly an organization hurting in the pocketbook.  I have a ton of friends at ESPN at the executive level, and they are doing just fine and will be for many many many years to come.  They will do special rates, if I had to guess, in the mobile space and monetize in the skinny packages as well.

Here is what I read ....

ESPN is losing revenue
ESPN overspent of TV rights
ESPN will over spend even more on TV rights
ESPN has too high a cost structure

Everyone at ESPN will be fine.




77ncaachamps

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Re: Is ESPN In Trouble (cord-cutter)
« Reply #47 on: November 27, 2015, 04:16:38 PM »
Here is what I read ....

ESPN is losing revenue
ESPN overspent of TV rights
ESPN will over spend even more on TV rights
ESPN has too high a cost structure

Everyone at ESPN will be fine.

I agree, Heisenberg, for the near future.

When I want scores, I don't type in Fox1Sports, Yahoo Sports, CBSsports into my web browser. I type in four letters: E-S-P-N.

And I use their app as well.

However, I would rather follow on Twitter, even if that means I have to sift through the trash, because it's more current. Reading an article on ESPN or getting late "updates" (with no commentary) is becoming passe.
[This space reserved for a Jordan King highlight.]

ChicosBailBonds

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Re: Is ESPN In Trouble (cord-cutter)
« Reply #48 on: November 27, 2015, 05:31:56 PM »
Here is what I read ....

ESPN is losing revenue
ESPN overspent of TV rights
ESPN will over spend even more on TV rights
ESPN has too high a cost structure

Everyone at ESPN will be fine.

What you didn't read

ESPN is losing subscribers but OFFSET by higher per rate sub gains.  These articles you are reading DO NOT call out ESPN revenues, instead these analysts are extrapolating how much money they think have shrunk do to subscriber declines.  They are purely guessing and based on the per sub rate they are using, they are off the mark. 

No one said everyone at ESPN will be fine, there have been obvious cutbacks.

They absolutely did overspend for rights, which by the way they have tied up until the early 2020's.  With Fox and others clamoring for more rights, that will continue into the next decade as well.  Guess how they'll monetize it?  They'll charge even more for their content

ESPN is profitable and will remain profitable. 

ChicosBailBonds

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Re: Is ESPN In Trouble (cord-cutter)
« Reply #49 on: November 27, 2015, 05:39:42 PM »
Passe or not, here's why you will continue to go to ESPN for the next decade

College football regular season (ACC 2027, Big 12  2025, Pac-12  2023, SEC 2023, etc)
College football bowl games 2024
College football playoff  2026
College basketball  (ACC 2027, Big Ten 2017, Big 12   2025, Pac-12 2023, SEC 2023)
NFL until 2021
MLB  2021
NBA 2025
Masters Golf
US Men's Soccer National Team   2022
On and on


I wholeheartedly agree that ESPN overpaid, just as FOX totally overpaid for Big East.  That's the nature of sports broadcasting.  They will find a way to monetize it and ESPN will remain where one comes to see live sports for the next decade plus.