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ESPN is in as many homes today as in 2013

ESPN reverses declines with vMVPDs ESPN+

ESPN appeared to be in trouble in 2017, having lost 10 million households in the previous five years. However, the brand has turned its fortunes around by riding the growth of vMVPDs and investing in ESPN plus.

vMVPD’s helped reverse ESPN’s decline

In 2013, ESPN was at the height of its popularity, reaching into 98.5 million U.S. homes. Five years later, the network appeared to be in trouble. It had lost 10 million homes, losing nearly 600,000 homes in a single quarter. Things looked bleak for the channel. Cord-cutting was beginning to pick up speed, with every customer that left pay TV adding another household to the loss column for ESPN.

Disney had already begun to shift strategy to compensate for the losses. When the vMVPD pioneer Sling TV launched in 2015, Disney licensed ESPN to the service. It continued to license ESPN to other interested vMVPDs, including YouTube TV, fuboTV, and Hulu Live. The vMVPD licensing strategy reversed the declines of the previous five years, restoring access to 9 million homes by the beginning of 2020.

In 2019, vMVPD growth slowed dramatically and is now failing to keep up with the decline in cable, satellite, and telco TV. Between 2017 and 2018, ESPN picked up 4.5 million households through vMVPD providers, while traditional homes declined about 2 million. In 2019, ESPN added just 0.7 million vMVPD homes while traditional pay TV homes slumped 3 million.

Over the last year or so, the launch of ESPN plus has more than picked up the slack in the pay TV industry.

ESPN plus is the future of the brand

ESPN plus launched in early 2018 with an interesting set of non-premium sports content that attracted 1 million subscribers within five months of the release.

Since then, Disney has been adding sports content and striking exclusive deals that make ESPN plus essential to increasing numbers of sports fans. For example, early last year, the company struck an exclusive deal with UFC. Fight fans must subscribe to ESPN plus for $4.99 a month before they can buy access to pay-per-view fights.

This week, ESPN plus secured exclusive streaming rights to the PGA tour. The nine-year deal, which starts in 2022, also moves the Tour’s own subscription video service, PGA Tour Live, to ESPN plus. Broadcasters CBS and NBC will also have the rights to air FedExCup tournaments.

ESPN+ the future of the brand

Just before the launch of ESPN plus in 2018, then CEO Bob Iger said:

“Over time, our intention would be for that app to be the app that

Bob Iger CEO Disney

Bob Iger, CEO Disney

people experience ESPN on.”

His strategy to get there has become apparent. Deliver a basic set of sports contents with an ESPN plus subscription. Become the exclusive home for other subscription and pay-per-view sports. So far, the approach seems to be working splendidly well. The sports service now has 7.6 million subscribers. What’s more, the total number of cable, satellite, telcoTV, vMVPD, and ESPN plus households that have access to the ESPN brand is almost as many today, 98.1 million, as in 2013.

Why it matters

ESPN was in a rapid decline in 2017.

Disney turned the brand around by licensing the channel to vMVPDs.

However, the future of the brand is online, with ESPN plus.

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