The cable bundle is bending. When does it break?



Not this month.

People are interested in Nielsen’s cable coverage estimates for a variety of reasons. One is sometimes people just like long lists of familiar names with numbers attached to them. Maybe I’m just projecting. There are plenty of fans who are very interested in the difference in coverage between say USA & FS1 should WWE be on the move and the lists are useful for that.

Recently I’m only interested in one thing: the rate of decline for ESPN and how quickly ESPN dwindles to below 75 million homes.

ESPN is still in over 86 million homes. That’s down ~14 million from its heights but ESPN is still very profitable. Folks like Eric Jackson believe that even if ESPN dwindled to 50 million homes (!) it would still have similar profit margins as the ABC broadcast network.

For simplicity I’ve concluded there’s 0 chance ESPN would launch a real OTT service (one that offered all the content available on ESPN) until ESPN is available in fewer than 75 million households. I doubt they’d do it even then, I just don’t see any chance they’d do it before then because of how successful ESPN’s current business model is. Of course households are only one component. What if all the cable, satellite, etc. providers start paying less for ESPN? Just because it’s never happened doesn’t mean it never will happen, but it does mean I’m not going to worry about it this month.

With the sometimes crazy month-to-month variations, it’s easy to see ESPN lost 500,000 households for May 2018 vs April 2018 and convert that to a run rate of 6 million households lost/year and think 75 million is right around the corner. 

But if you compare May 2018 to May 2017 not only did ESPN lose fewer than 6 million homes in the past year, it lost fewer than a million and I don’t need to worry about thinking about when ESPN will launch a true OTT service…at least until next month’s cable coverage estimates come out. 


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