During a TV interview, the usually upbeat, vigorous-looking Iger appeared a bit thinner and wearier as he was forced to play defense regarding the powerful and still highly profitable sports franchise — accepting ratings declines at ESPN’s flagship “SportsCenter” show and suggesting that over-the-top online offerings were better than traditional cable, satellite and telecom pay-TV technology.
“They’re more user-friendly, more mobile-friendly … more attractive to a younger generation of consumers, ” the 66-year-old CEO said.
Iger also suggested he should get some credit for being honest about the cracks in pay-TV subscriber numbers two years ago.
To be sure, in August 2015, when Iger conceded “some subscriber losses” at ESPN — the first cracks in the sports network’s seemingly impenetrable business model — Wall Street investors saw it as a worrisome sign for the whole sector, which sank 9 percent on the news.
Well, the worry is back on Wall Street. Disney stock was down 2.6 percent in after-hours trading, to $109.18, after the Burbank, Calif., company reported operating profits at its cable networks — its most profitable business, with operating profit margins at 44 percent — slipped 3 percent.A half-million consumers dropped video packages from traditional providers in the three-month period ended April 1.
Iger aimed to calm fears about the turbulence in ESPN’s traditional distribution model by explaining that the sports giant has deals with new online-only packages to take up the slack.
Iger said that, by the end of 2017, ESPN will launch a direct-to-consumer streaming product that may have specific sports or be tailored to regions or be as long as a season.
Analysts have been laser-focused on ESPN’s declining subscriber counts. According to Nielsen, ESPN is currently distributed in 86.9 million households, down from 89.8 million during May 2016.
No comments:
Post a Comment