Disney CEO Open to Selling ESPN if Strategic Partner Can’t Be Found for Standalone Streaming Service
Five years ago, it would have been difficult to imagine the entire future of ESPN would be as up in the air as it is today. The channel was available in 100 million homes in 2011 but has now slipped behind FS1 to be the second-most distributed cable sports channel, with less than 72 million households subscribing.
ESPN is not the only channel to lose a substantial portion of its viewers, of course. Cord cutting has taken a big bite from cable revenues all across the country, and the problem is only getting worse. Disney CEO Bob Iger knows this quite well, which is why he recently signaled a willingness to sell off Disney-owned linear channels like ABC, Disney Channel, Freeform, and others. The focus media-wise at Disney seems to be all about streaming, which is certainly good news for Disney+ and Hulu.
It could be good news for ESPN, too, but there are suddenly a lot of questions surrounding the worldwide leader in sports. Recently, Disney has been in conversations with sports leagues and major tech companies regarding buying minority stakes in ESPN, as the company works toward the goal of creating a streaming version of the full ESPN suite of channels and programming that doesn’t require a cable or satellite subscription.
A new report from CNBC indicates that while Disney will explore every option for keeping control of ESPN first, it will also consider spinning off the network and selling it completely if it can’t find partners to help it achieve its goals. Iger is paying two outside consultants to help him sort out the ESPN situation, one of which was a former Disney employee who was open to spinning off the sports network in the past.
This is not the first time the topic of siloing ESPN has been raised at Disney. In 2021, it was reported that the company regularly had conversations about whether to separate ESPN from the rest of the Disney operation, but the talk died down last fall when Disney executives threw cold water on the idea.
It would be fascinating to see which media companies emerged as potential buyers for ESPN if it came up for sale. Comcast and Warner Bros. Discovery both continue to be active in sports broadcasting, but the size of both companies and the number of live sports they already televise could create antitrust concerns with regulators. While Comcast is more financially stable, WBD is still trying to get its financial footing under it following the merger of WarnerMedia and Discovery, though its most recent earnings report indicates that it might be closer to reaching that goal than previously anticipated.
Perhaps Apple might decide that instead of being a minority partner in ESPN, it could control the whole thing, and spin up a new streaming platform for the channels as it did with MLS Season Pass, only on a much larger scale.
Disney currently owns 80% of ESPN, while the other 20% is owned by Hearst Communications. Plan A seems to be executing the pivot to streaming by partnering with a company like Apple or a sports league like the NFL — or both. But if it can’t make a deal that satisfies all of its pay-TV partners, Disney is apparently willing to sell ESPN and its assets (presumably including ESPN+) and focus its efforts on its other entertainment streamers.
ESPN+
ESPN+ is a live TV streaming service that gives access to thousands of live sporting events, original shows like Peyton’s Place, the entire library of 30 for 30, E:60, The Last Dance, as well exclusive written analysis from top ESPN insiders. Sports available on ESPN+ include NFL, MLB, NHL, UFC, College Football, F1, Bundesliga, PGA Tour, La Liga, and more.