ESPN Inc. explained

ESPN Inc.
Type:Joint venture
Industry:Sports broadcasting
Founder:Bill Rasmussen
Hq Location City:Bristol, Connecticut
Hq Location Country:United States
Key People:James Pitaro (chairman)
Num Employees:9464 (2024)

ESPN Inc. is an American multinational sports media conglomerate majority-owned by the Walt Disney Company, with Hearst Communications as an equity stakeholder.[1]

Headed by James Pitaro, it owns and operates local and global cable and satellite television variants of ESPN, ESPN2, ESPN Radio, ESPN.com, ESPN+ and other related ventures.[2] [3] [4]

Commonly and colloquially marketed as the "Worldwide Leader in Sports", programming on its television networks include broadcasts of live or tape-delayed sporting events and sports-related programming including talk shows and original documentary series and films.[5]

History

See main article: History of ESPN. ESPN Inc. was founded in 1979 by Bill Rasmussen, initially as an attempt to broadcast Connecticut sports over an "Entertainment and Sports Programming Network" (ESPN) cable channel, and soon became a nationwide cable sports network. Shortly after being terminated as the World Hockey Association's New England Whalers communications director in 1978, Rasmussen conceived of a plan to produce Connecticut sports events for Connecticut cable systems.[6] With his son, Scott, they had moved beyond that, considering a national sports channel doable.[6] RCA had an underused satellite and was pushing for customers. Finding it cheaper by the hour to rent a satellite transponder full-time, instead of 5 hours a day, the Rasmussens changed their plans from creating a Connecticut sports channel to creating a national cable network. [7]

On February 7, 1979, Bill Rasmussen got the NCAA to agree, in principle, to grant ESPN broadcast rights for NCAA sports. The next day at the Texas Cable Show exposition, he was able to get cable companies on board. An advertising contract with Anheuser-Busch was in talks at that time, and Getty Oil came on board as its major source of capital. In 1979, Rasmussen purchased the first acre of land for ESPN's headquarters in Bristol, Connecticut.[6] With a reasonable payment plan in July 1979, Rasmussen leased RCA's Satcom 1 transponder using his credit card. Anheuser-Busch became a major sponsor, signing a $1.4 million ad contract, a record at the time. Getty Oil invested $10 million into ESPN getting a controlling stake in 1979.

On September 7, 1979, the ESPN cable channel went on the air,[6] with 24 hours of programming on the weekends and limited hours during the week. 625 cable system affiliates were signed up at launch and they had one million household subscribed total (out of 20 million households with cable). The channel's first game featured the Milwaukee Schlitz and the Kentucky Bourbons in the deciding game of the championship series of the American Professional Slo-Pitch League.

In 1980, the company was named in a Texas divorce filing. Groundbreaking for its headquarters took place one year earlier.[6] Full-time broadcasting began in September 1980. Additional programming at the time included weekly boxing matches.

NBC Sports President Chet Simmons was hired to help run the cable channel. Simmons and Rasmussen were at odds with Getty Oil executives siding with Simmons. At the end of 1980, Rasmussen was removed as company president by Getty Oil executive for ESPN, Stuart Evey, relegating him to a ceremonial role. Rasmussen left in 1981 and sold his remaining stock in 1984.[6]

Investing another $15 million into the company and no profits expected any time soon, Getty used management consultant McKinsey & Co. to assess ESPN's future. McKinsey's lead consultant was Roger Werner, who figured with another $120 million and five years ESPN would become a profit maker. Werner soon was hired by ESPN as vice-president of finance, administration, and planning and developed a new business plan. Werner developed a new revenue source beyond advertising by initiating revolutionary affiliate fees paid by the cable operators by number of subscribers starting at 6 cents. Between CBS Cable folding in October 1982 and the new CEO, Bill Grimes, they convinced most of the reluctant cable providers to pay. By 1985, the fee was 10 cents.

ESPN was the largest cable channel by the end of 1983 with 28.5 million households. Also in 1983, the company began distributing programming outside the United States. In 1984, the U.S. ABC television network purchased a controlling stake in the company. ABC later merged with Capital Cities Communications, and the combined company was purchased by The Walt Disney Company in 1995.[8] In 1988, Roger Werner became the network's president and CEO.

Multichannel

ESPN started out expanding into other nations and additional channels. The ESPN International unit was formed in 1988 to start channels in other nations beginning with ESPN Latin America in 1989. In 1992, ESPN Asia was launched. ESPN partnered with TF1 and Canal+ for a made over Eurosport to enter Europe.

RJR Nabisco sold its 20% stake in ESPN to the Hearst Corporation. Werner resigned as CEO and president in October 1990 for another sports CEO job.[9] Steve Bornstein replaced him in the CEO post moving up from the second position of executive vice-president in charge of programming and production.

With ABC Radio Network, the company started the ESPN Radio Network in 1991 with programming 16 hours per week. Ohlmeyer Communications' sports programming division was purchased in March 1993. ESPN launched ESPN2 on October 1, 1993 at 7:30 PM. The channel at the time was targeting those age 18-34.[10] In 1994, ESPN acquired Creative Sports[11] and from Dow Jones an 80% stake in SportsTicker.

In 1997, ESPN acquired the Classic Sports Network.[12]

In 2006, ESPN acquired the North American Sports Network (NASN). It was re-branded as ESPN America on February 1, 2009.[13] [14]

In February 2016, ESPN and Tencent reached an agreement of collaboration. ESPN's content would be localized and exclusively distributed and promoted by Tencent's digital platforms in China, including college basketball games, the X Games and an ESPN section on QQ.com.[15] In August 2016, Disney purchased a 1/3 stake in BAMTech for $1 billion from MLB Advanced Media with the option to purchase a majority share, which it later exercised, and now owns 85%. Disney purchased the stake to first develop an ESPN-branded subscription streaming service, later named ESPN+.[16]

In July 2023, it was reported that Disney was contemplating selling an equity stake in ESPN to an outside partner, as part of a future expansion of its streaming business to include ESPN's linear networks.[17]

On August 8, 2023, Penn Entertainment announced a $2 billion agreement with ESPN to rebrand its Barstool Sportsbook sports betting services as ESPN Bet. As part of the agreement, ESPN will receive $1.5 billion in cash over 10 years, and will take $500 million in Penn stock.[18] [19]

On February 6, 2024, ESPN announced a joint venture with Fox Sports and TNT Sports to launch a sports streaming service called Venu Sports, offering the three organizations' main linear sports channels and associated media rights, beginning in fall 2024.[20] Additionally, the company plans to launch a "flagship" standalone streaming offering, including the ESPN and ESPN2 linear channels, in late summer or fall 2025.[21]

Executives

Assets

Television

Radio

Internet

ESPN also supplies content to Disney's Star+ subscription streaming service available in Latin America (2021–present).

Canada

Under the Canadian Radio-television and Telecommunications Commission's rules regarding foreign broadcasters, ESPN has been prohibited from acquiring majority ownership of any channel operating in Canada. Instead, ESPN partnered with several Canadian firms to form a privately held consortium named NetStar Communications in 1995, which then acquired the sports networks TSN and RDS. These Canadian partners then sold their shares in 2001 to CTV Inc. (now Bell Media). ESPN continues to own 20 percent of what is now CTV Specialty Television while Bell Media owns the remaining 80 percent.[24]

The sports channels owned by the CTV Specialty Television subsidiary:

Through CTV Specialty Television, ESPN also has an indirect interest in several channels operated in partnership with Warner Bros. Discovery, but ESPN is not believed to be directly involved with these operations.

United Kingdom

See main article: ESPN in the United Kingdom. ESPN entered the United Kingdom in 2006 when pan-European ESPN Classic was added to Sky Digital.[25]

In December 2006, the North American Sports Network, which operated as a joint-venture between Benchmark Capital Europe and Setanta Sports announced the sale of the channel to ESPN for €70 million.[13] The sale's closure on March 2007 added NASN to the ESPN family, although it remained as part of the Setanta Sports Pack on satellite television.[26] [27] On October 2, 2008, it was announced that NASN would rebrand as ESPN America.[14] The rebranding took place on February 1, 2009, to coincide with Super Bowl XLIII.[13] [14]

On June 19, 2009 it was announced that Setanta Sports UK had lost their local rights package to half of the UK Premier League matches, with ESPN as one of the interested parties to acquire the rights.[28] On June 22, 2009, a day before Setanta UK collapsed into administration, ESPN announced they had snapped up the rights from the 2009–10 season to the 2012–13 season, and would launch their own domestic channel.[29] ESPN UK launched in August 2009, forming as part of a new TV package with America and Classic, by acquiring much of the ex-Setanta slots.

By 2012, the network had begun to lose many of its key sports rights, including the Premier League, to BT Group.[30] [31] [32] On January 25, 2013, ESPN reached a deal to sell its television business in the United Kingdom and Ireland, including ESPN America's programming rights, to BT Group. The ESPN channel in the United Kingdom was placed under the control of BT Sport, while ESPN Classic and ESPN America shut down. ESPN continues to operate digital properties targeting the United Kingdom, including its ESPN.co.uk, ESPN FC, ESPNcricinfo, and ESPNscrum websites.[33] Two years later, ESPN reached a long-term deal with BT Sport for the British rights to ESPN original programming and international event rights.[34]

The main ESPN network following the BT purchase transitioned to airing North American Sports programming, and in June 2015 was renamed BT Sport ESPN. On May 11, 2022, BT announced that the BT Sport networks would form as part of a new joint venture with Disney rival Warner Bros. Discovery and to merge with their existing Eurosport networks at a later date.[35] [36] [37] Due to this, ESPN decided not to renew their name licensing deal with BT, and on 1 August 2022, the channel was renamed BT Sport 4, although it continues to mainly focus on North American sports.[38]

Other

Divested

Defunct

See also

Notes and References

  1. Web site: ESPN. Hearst Communications. 28 February 2014. 6 October 2014. https://web.archive.org/web/20141006131037/http://www.hearst.com/entertainment/espn. dead.
  2. Web site: ESPN, Inc. Fact Sheet. ESPN Newsroom. 2 August 2019. 3 August 2019. https://web.archive.org/web/20190803000528/https://espnpressroom.com/us/espn-inc-fact-sheet/. live.
  3. Web site: ESPN, Inc.: Private Company Information. https://web.archive.org/web/20080208055439/http://investing.businessweek.com/research/stocks/private/snapshot.asp?privcapId=28238. dead. February 8, 2008. BusinessWeek. 28 February 2014.
  4. Web site: ESPN, Inc. Company Profile. Hoovers. 28 February 2014.
  5. Web site: Badenhausen. Kurt. Why ESPN Is Worth $40 Billion As The World's Most Valuable Media Property. Forbes. 28 February 2014. 25 January 2018. https://web.archive.org/web/20180125165838/https://www.forbes.com/fdc/welcome_mjx.shtml. live.
  6. News: Champions: Bill Rasmussen, ESPN creator. Ourand. John. April 4, 2011. Sports Business Journal. March 27, 2018. American City Business Journals. en. September 19, 2020. https://web.archive.org/web/20200919024118/https://www.sportsbusinessdaily.com/Journal/Issues/2011/04/04/People-and-Pop-Culture/Rasmussen.aspx. live.
  7. Book: International Directory of Company Histories, Vol. 56. 2004. St. James Press. March 27, 2018. en. History of ESPN, Inc.. December 24, 2020. https://web.archive.org/web/20201224205510/http://www.fundinguniverse.com/company-histories/espn-inc-history/. live.
  8. Web site: ESPN, Inc. Fact Sheet. ESPNPressRoom.com. June 22, 2019. November 29, 2020. https://web.archive.org/web/20201129045827/https://espnpressroom.com/us/espn-inc-fact-sheet/. live.
  9. News: Werner to Leave ESPN, Join Daniels' Firm . Los Angeles Times . August 30, 1990 . January 16, 2015 . January 22, 2015 . https://web.archive.org/web/20150122001943/http://articles.latimes.com/1990-08-30/business/fi-542_1_bill-daniels . live .
  10. News: Frager. Ray. Whether you get it or not, ESPN2 has no tie to the tried and true. March 28, 2018. Baltimore Sun. Tribune Publishing. October 1, 1993. en. October 1, 2012. https://web.archive.org/web/20121001232654/http://articles.baltimoresun.com/1993-10-01/sports/1993274121_1_sportsnight-sportscenter-olbermann. live.
  11. News: ESPN remembers Dan Shoemaker - ESPN Front Row. 2018-04-06. ESPN Front Row. 2018-04-26. en-US. 2020-09-20. https://web.archive.org/web/20200920232335/https://www.espnfrontrow.com/2018/04/espn-remembers-dan-shoemaker/. live.
  12. News: David . Whitford . The king of the sports deal . May 25, 2010 . . 2010-06-02 . dead . https://web.archive.org/web/20100522034442/https://money.cnn.com/2010/05/10/news/companies/greenberg_sports_deal_king.fortune/ . May 22, 2010 .
  13. News: Hancock . Ciaran . Ireland: TV3 grabs Setanta stake . . 3 December 2006 . 2007-08-07 . London . 2011-06-12 . https://web.archive.org/web/20110612023016/http://business.timesonline.co.uk/tol/business/article658043.ece . live .
  14. News: Welsh. James. NASN to become ESPN America. Digital Spy. 2 October 2008. 2008-10-02. 2009-06-01. https://web.archive.org/web/20090601150928/http://www.digitalspy.co.uk/broadcasting/a131634/nasn-to-become-espn-america.html. live.
  15. News: Frater. Patrick. ESPN Scores Strategic Agreement With China's Tencent. February 2, 2016. Los Angeles Times. February 2, 2016. February 4, 2016. https://web.archive.org/web/20160204090742/https://variety.com/2016/biz/asia/espn-scores-strategic-agreement-with-tencent-1201695512/. live.
  16. News: Miller. Daniel. Walt Disney Co. buys stake in video streaming service BAMTech. August 17, 2016. Los Angeles Times. August 9, 2016. November 8, 2020. https://web.archive.org/web/20201108135026/https://www.latimes.com/entertainment/envelope/cotown/la-et-ct-disney-earnings-20160809-snap-story.html. live.
  17. Web site: Rizzo . Alex Sherman,Lillian . 2023-07-13 . Disney is open to finding a new strategic partner for ESPN, Iger says . 2023-08-09 . CNBC . en . 2023-08-09 . https://web.archive.org/web/20230809045610/https://www.cnbc.com/2023/07/13/disney-open-to-finding-espn-strategic-partner.html . live .
  18. Web site: Maruf . Ramishah . 2023-08-08 . ESPN is jumping into sports gambling in a $2 billion deal . 2023-08-09 . CNN . en . 2023-08-09 . https://web.archive.org/web/20230809025811/https://www.cnn.com/2023/08/08/business/penn-entertainment-barstool-sports-espn/index.html . live .
  19. News: 2023-08-08 . ESPN Is Getting Into Sports Betting With Penn Entertainment . en . Bloomberg.com . 2023-08-09 . 2023-08-08 . https://web.archive.org/web/20230808211746/https://www.bloomberg.com/news/articles/2023-08-08/espn-signs-sports-betting-deal-with-penn-entertainment . live .
  20. Web site: Disney, Fox and Warner Bros. Join Forces for Sports Streaming Service. Benjamin. Mullin. Kevin. Draper. The New York Times. February 6, 2024. February 7, 2024.
  21. Web site: Disney Reveals Timing Of ESPN Stand-Alone Streaming Launch. Dade. Hayes. Deadline Hollywood. February 7, 2024. February 8, 2024.
  22. Web site: ESPN's The Undefeated to Launch May 17 - ESPN MediaZone. 18 April 2016. 7 July 2020. 12 June 2018. https://web.archive.org/web/20180612163653/https://espnmediazone.com/us/press-releases/2016/04/176888/. live.
  23. Web site: About. 15 June 2015. 16 July 2022. 25 July 2022. https://web.archive.org/web/20220725194012/https://andscape.com/about/. live.
  24. News: CTV can acquire TSN if it unloads Sportsnet . Globeandmail.com . March 20, 2017 . Toronto . March 25, 2000 . September 21, 2020 . https://web.archive.org/web/20200921043652/https://www.theglobeandmail.com/sports/ctv-can-acquire-tsn-if-it-unloads-sportsnet/article1038075/ . live .
  25. Web site: Disney Cinemagic & ESPN Classic launch in March. Media 247. 2006-02-27. dead. https://web.archive.org/web/20120308071645/http://media247.co.uk/skydigital/newsarchive/2006/02/sky_launch_conf.php. 8 March 2012. dmy-all.
  26. ESPN TO ACQUIRE NASN . . 2007-08-07 . 2007-09-30 . https://web.archive.org/web/20070930192207/http://www.nasn.com/content/nasn/portal.nsf/content/espnrelease . live .
  27. Web site: Overview of Setanta Sports Pack . Setanta.com . 2007-09-10 . https://web.archive.org/web/20071117111147/http://www.setanta.com/SetantaSportsPack/Overview.aspx . 2007-11-17 . dead .
  28. Web site: Setanta loses Premier TV rights. BBC News. 19 June 2009. 24 February 2017. 16 January 2021. https://web.archive.org/web/20210116161216/http://news.bbc.co.uk/2/hi/business/8109954.stm. live.
  29. Web site: 22 June 2009. ESPN snaps up Premier League TV packages. ESPNsoccernet. 23 March 2017. 23 December 2019. https://web.archive.org/web/20191223043513/http://www.espnfc.com/story/656557/espn-snaps-up-premier-league-tv-packages. live.
  30. Web site: 13 June 2012. Premier League rights sold to BT and BSkyB for £3bn. BBC News. 23 March 2017. 9 August 2013. https://web.archive.org/web/20130809041029/http://www.bbc.co.uk/news/business-18430036. live.
  31. Web site: 12 September 2012. BT poaches Premiership Rugby rights from ESPN, Sky. Digital Spy. 23 March 2017. 24 September 2015. https://web.archive.org/web/20150924051839/http://www.digitalspy.co.uk/media/news/a405472/bt-poaches-premiership-rugby-rights-from-espn-sky.html. live.
  32. Web site: 6 November 2012. BT deals further blow to ESPN with new rights deals. Digital Spy. 23 March 2017. 3 June 2013. https://web.archive.org/web/20130603110132/http://www.digitalspy.co.uk/media/news/a436090/bt-deals-further-blow-to-espn-with-new-rights-deals.html. live.
  33. Web site: 25 February 2013. BT buys ESPN'S UK and Ireland TV channels. The Guardian. 24 February 2017. 12 August 2020. https://web.archive.org/web/20200812080213/https://www.theguardian.com/media/2013/feb/25/espn-bt-vision. live.
  34. Web site: BT Sport and ESPN deepen relationship with long-term collaboration. BT Group. 17 July 2015. 2 July 2015. https://web.archive.org/web/20150702130836/http://www.btplc.com/news/articles/showarticle.cfm?articleid=%7B60a32774-3b2c-4b26-90de-44a829925ea7%7D. live.
  35. News: Metz . Axel . 12 May 2022 . BT Sport subscribers to get major package upgrade completely free of charge . TechRadar . 12 May 2022 . 12 May 2022 . https://web.archive.org/web/20220512105201/https://www.techradar.com/uk/news/bt-sport-subscribers-to-get-major-package-upgrade-completely-free-of-charge . live .
  36. Web site: Frater . Patrick . 2022-05-12 . Warner Bros. Discovery and BT to Launch Sports Venture in U.K. and Ireland . 2022-05-16 . Variety . en-US . 2022-05-16 . https://web.archive.org/web/20220516214447/https://variety.com/2022/tv/global/warner-bros-discovery-bt-sports-uk-ireland-1235264924/ . live .
  37. Web site: 2022-05-12 . BT and Warner Bros Discovery join forces to create pay-TV sport business . 2022-05-16 . the Guardian . en . 2022-05-16 . https://web.archive.org/web/20220516003334/https://www.theguardian.com/business/2022/may/12/bt-and-warner-bros-discovery-join-forces-to-create-pay-tv-sport-business . live .
  38. Web site: BT Sport ESPN to rebrand as BT Sport 4 . 2022-10-02 . Media Mole . en-GB . 2022-10-02 . https://web.archive.org/web/20221002032208/https://www.mediamole.co.uk/entertainment/broadcasting/news/bt-sport-espn-to-rebrand-as-bt-sport-4_489865.html . live .
  39. Web site: Disney, ESPN Now Own Piece Of DraftKings Sportsbook After Fox Deal . Gouker . Dustin . May 20, 2019 . Legal Sports Report . live . https://web.archive.org/web/20190520120624/https://www.legalsportsreport.com/32634/disney-owns-piece-of-draftkings-after-fox-deal/ . May 20, 2019 . May 20, 2019.
  40. Web site: ESPN Player. 2021-03-10. www.espnplayer.com. 2021-03-10. https://web.archive.org/web/20210310015329/https://www.espnplayer.com/. live.
  41. Web site: 2014-04-10. ESPN Player. 2021-03-10. ESPN Press Room EMEA. en-US. 2022-04-06. https://web.archive.org/web/20220406153245/https://espnpressroom.com/espnuk/espn-player/. live.
  42. Web site: 19 June 2003. Sega Cans 2K Line For Deal With ESPN. Xbox Addict. 18 September 2022. 20 September 2022. https://web.archive.org/web/20220920171110/https://xboxaddict.com/news/3552/Sega-Cans-2K-Line-For-Deal-With-ESPN.html. live.
  43. Web site: 5 November 1999. Konami, Disney and ESPN Bond. IGN. 18 September 2022. 20 September 2022. https://web.archive.org/web/20220920170632/https://www.ign.com/articles/1999/11/05/konami-disney-and-espn-bond. live.

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