ESPN and the NFL have reportedly finally agreed to a deal that will give the network control of the league’s media platforms. But does this deal meet the perilous moment in sports and media?
It is a testament to the power of the NFL that the league could get Disney to take on a niche linear cable platform at a time when media corporations are shedding such properties whenever possible. Now, about two years after Bob Iger set off a multi-week newscycle by calling Disney’s linear networks “no growth businesses” that may not be “core” to the company (ESPN a noted exception), Disney is set to assume full ownership of a cable channel that is almost certainly in fewer than 50 million homes — and surely dropping.
Of course, even the NFL’s power goes so far. The simple fact that the nation’s most popular property has been desperately trying to offload its media business for four years — and that it has had such a difficult time finding any takers — is a good indication of how strong the headwinds facing pay TV truly are.
One might be tempted to view ESPN acquiring NFL Network and RedZone in the same context as its deals to license “The Pat McAfee Show” or TNT’s “Inside the NBA,” but beyond the vastly larger scope of this agreement, the difference between simply hosting content and owning it cannot be understated. Decisions will have to be made about who to retain, what shows will continue (and where), and what editorial direction the network will take.
It is not necessarily certain that ESPN will follow the “McAfee” precedent and leave well enough alone, given it will fully own NFL Network and RedZone. As Andrew Marchand has reported, the expectation is that ESPN will seek to improve NFL Network programming, meaning it will at the very least leave some stamp on the channel.
To say the least, the NFL Media deal runs contrary to the prevailing strategy at ESPN. It is going to be costly — worth potentially billions, per Marchand — at a time when the company is being relatively thrifty. It is going to expand the payroll at a time when the company has been shedding salaries. It is going to create many more hours of programming to fill at a time when the company has been cutting long-running shows.
It is a testament to the power of the NFL that these compromises are worth the trouble. This is a deal that gives ESPN seven additional NFL regular season windows each season, ownership of the ever-popular RedZone, and the security of having the league as a minority owner. If that comes at the cost of the trend toward efficiency that has defined corporate media in recent years, so be it.
Make no mistake, this is a deal with some red flags. The genre of ‘league-specific network’ is broadly in decline, and while one might see a strong viewership number or two on MLB Network or NBA TV, the issue is less one of declining viewership than declining subscribers. At least for live games, about the same number of people are watching NFL Network, MLB Network and NBA TV as there ever were (with out-of-home viewing providing a caveat). But as long as the number of subscribers is in the 40, 30, or even 20 million range, the long-term prospects are bleak.
ESPN is essentially being saddled with a ‘no-growth business’ in NFL Network, but that is a small price to pay for the most valuable programming in all of television — live NFL action — and perhaps most importantly, a deeper intertwining of the nation’s biggest sports league and network.