Could All-Inclusive ESPN Streaming Service Actually Save Cable TV While Helping Disney Avoid Legal Trouble?
Could All-Inclusive ESPN Streaming Service Actually Save Cable TV While Helping Disney Avoid Legal Trouble?
Sports fans are waiting with bated breath to hear more details about the potential for a standalone, streaming version of ESPN that won’t require a cable subscription. Such a product is reportedly currently in the works at Disney, though the company has remained tight-lipped about it.
It’s hard to escape the prevailing wisdom that offering ESPN without the need for a cable subscription very well could be the final death knell to a pay-TV industry that already seems to be circling the drain as it is. But a new report from Variety suggests that cablers may tell Disney they’ll allow ESPN to be offered as a standalone channel if they can offer customers cable packages without it.
Considering how popular live sports are on cable, one would be forgiven for thinking the last thing cable providers would want to do is give users the option not to have it. But ESPN is expensive for providers and subscribers alike; Disney charges the highest carriage fee for any channel on cable for ESPN, and cablers often pass that cost to the consumer.
Users who have ESPN included in their cable subscription can feel it in their wallets. Variety cites numbers from S&P Global Market Intelligence which show that ESPN costs the average cable subscriber $8.72 per month. Users who have no interest in sports may be eager to sign up for packages that don’t have the channel, and will thus be cheaper on a monthly basis. That’s the idea behind current “skinny” streaming bundles with no live sports offerings like Philo, Frndly TV, and Comcast's new live TV streamer Now TV.
Allowing cable providers to offer cable packages without ESPN could also help Disney avoid some thorny legal troubles. Last November, YouTube TV users in several states joined a class-action lawsuit against Disney for forcing providers like YouTube to carry ESPN in their base plans, which raises the price of all subscription tiers.
When YouTube TV renegotiated its carriage agreements in 2021, its parent company Alphabet Inc. disclosed that if it were permitted to offer a version of the YouTube TV base plan without ESPN, it would charge $15 per month less. If Disney allowed streamers and cablers like YouTube TV to offer packages without ESPN, it would obviously no longer be exposed to legal action of this kind.
The bad news for sports fans is that such a scheme would almost certainly drive the cost of streaming ESPN higher. Having non-sports watchers subsidize those who do watch ESPN helped keep the monthly fees associated with the channel down, as more people were paying to have their provider carry it. If the people who are actually watching ESPN are the only ones paying for it, users should expect to pay $30 per month at the absolute minimum for the streaming version of the ESPN family of networks.
Assuming there are enough cable watchers who aren’t interested in live sports out there, the shift to streaming for ESPN could be a beneficial one for cable providers. The worldwide leader in sports would still be available to cable subscribers who were interested, but users who didn’t want the channels would no longer have to subsidize those who do. It could keep pay TV on its feet a little while longer, even if its ultimate fate seems assured as cord-cutting continues to accelerate.
ESPN+
ESPN+ is a live TV streaming service that gives access to thousands of live sporting events including NFL, MLB, NHL, UFC, College Football, F1, Bundesliga, PGA Tour, La Liga, and more. Users can see sports documentaries and select archived events. Subscribers can access exclusive articles from top ESPN insiders.