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Why Did ESPN Layoff Hundreds of Employees?

Jason Barrett

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ESPN recently cut 300 employees and this layoff is just the first round with a few more anticipated. There are two main reasons for ESPN’s struggles: Losing subscribers and spending large amounts on sports broadcasting.

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In regards to losing subscribers, the chart above shows ESPN is declining in regards to households with subscriptions to the company. Cable companies are composing packages that exclude ESPN, resulting in a loss of 8.5 million subscribers over the past 4-5 years.

Additionally, ESPN is spending egregious amounts on the rights to broadcast certain sporting events. The new deal concerned with airing Monday Night Football for the NFL equates to $1.9 Billion. The amounts for other major and non-major sports or events are not far behind. ESPN predicts an amount of nearly $6 Billion combined from all major commitments by 2018 and beyond.

Essentially, ESPN is overpaying for many of their events including Monday Night Football. Fans and critics alike are concerned that there may not even be a bidder within $500 Million of that number (Sports Business Daily).

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The rights to air Monday Night Football games will undoubtedly earn ESPN a profit. However, overpaying is not a smart business decision. This set the template for overpaying for the rights to air NBA and MLB games. ESPN is competing with itself when it comes to bidding for rights.

The moves, including layoffs, continued a troubled period for the sports media giant that started when Disney CEO Bob Iger told CNBC, “The business model may face some challenges over the next few years.” Consequently, these concerns raised eyebrows and advised many to sell-off media stocks during the past summer.

Disney’s sports media arm is trying to right the ship and pivot on certain aspects of their business plan. Let us all hope that they remain afloat.

Credit to the Urban Twist who originally published this article

Sports TV News

FOX Sued for Patent Infringement Over NFL Scheduling

“Recentive Analytics filed suit against FOX in a Delaware federal court on November 29 according to Yahoo Sports.”

Jordan Bondurant

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An analytics company is suing FOX over claims that the network developed a mapping tool using their patented technology to create a season slate of NFL games.

Recentive Analytics filed suit against FOX in a Delaware federal court on November 29 according to Yahoo Sports.

The lawsuit claims FOX used access to Recentive’s predictive analytics tools to develop a resource of their own that would create optimal schedules for its 1 and 4 p.m. NFLwindows.

The company is seeking a declaration that FOX infringed on two of its patents. Recentive is also suing for damages and wants an injunction keeping FOX from using Recentive tech and preventing the network from “selling, offering for sale, marketing or using any internal network and mapping analytics tool for the scheduling and regionalization of events covered by the patents.”

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FOX Will Use Chris Fallica On Belmont Stakes Coverage

“While the Preakness and the Kentucky Derby remain at NBC, The Belmont Stakes is moving to FOX as part of the network’s deal with the New York Racing Association.”

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The Bear will be more than just a college football presence when he moves to FOX. Chris Fallica wrapped his final duties for ESPN last week and is now headed to a new network and will tackle some new responsibilities.

Fallica’s new role at FOX will involve plenty of sports gambling content. Richard Deitsch of The Athletic reports that content will include horse racing.

“One Fox Sports source said look for him to appear on the Belmont Stakes coverage,” Deitsch wrote in his weekly media column.

Starting in 2023, horse racing’s Triple Crown will not be seen all in one place. While the Preakness and the Kentucky Derby remain at NBC, The Belmont Stakes is moving to FOX as part of the network’s deal with the New York Racing Association.

How the network intends to use Chris Fallica on the broadcast is not clear. Given that he is coming to the network to contribute to gambling conversations, it is likely he would either be making picks or at least reviewing odds right up to the start of the race.

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Sports TV News

NBCUniversal CEO Expects Disney To Buy Company’s Hulu Stake

“Shell noted that live sports coverage is helping make the stake in Hulu a luxury for NBCUniversal.”

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The Walt Disney Company owns 67% of Hulu. The other 33% is owned by NBCUniversal. The latter company doesn’t expect that to be the case forever.

“It’s worth a lot of money,” NBCUniversal CEO Jeff Shell said at an investor conference earlier this week, “and I think there’s no indication that anything else is going to happen than Disney writing us a big check.”

Hulu is primarily a platform for movies and television shows. It is a major part of Disney’s deal with the NHL though. The streaming giant is part of the package of 103 games that are exclusive to ESPN and ABC. Hulu is also a live TV provider for many. The company’s Hulu Plus Live TV package had over 4 million subscribers as of the summer of 2022.

Shell noted that live sports coverage is helping make the stake in Hulu a luxury for NBCUniversal. He credits sports and content migrated from Hulu as the reason Peacock has grown to 18 million paid subscriptions since September.

Deadline reports that if Disney does want to acquire NBCUniversal’s stake in Hulu, “the price could fluctuate but will be in the tens of billions of dollars.”

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