ESPN:
Broadband Strategy
Onnie Bose
Mark Hicken
George Hsin
Shamus Prindiville
ESPN: A History
 created in 1979 as then-unheard of 24 hour all-sports
network
 known to be a creative and innovative network, willing
to take risks
 continues to move into unproven markets with
remarkable success
espn2 added in 1993
ESPNews added in 1996
ESPNet Sportszone (now ESPN.com) launched in late 1994
ESPN Internet Ventures
Over 12 million unique impressions per day at
ESPN.com
22 million visits at associated sites (NASCAR,
NFL, NBA, ABC Sports)
A mature player, “the worldwide leader”
Main Competitors
CBS Sportsline
The Sporting News
CNN/SI
Yahoo! Sports
America Online
Looking Forward
Cannot rely solely on brand equity
Provide a “value-added experience”
Anticipate broadband and online video delivery
Focus on strengths in sports analysis
Broadband and its
implications
The ability to transmit seamless voice, data, and
video content
the Wall Street Journal (10/98)
“Web entertainment is about viewers manipulating
the programming to entertain themselves,… The
denizens of cyberspace don’t just want to watch the
show - they want to be the show.”
ESPN and the Sports
Media Industry
Providing live game content is expensive
nearly $2 billion for NFL television rights
highly competitive
News, commentary, and feature programming
drives revenue
SportsCenter, NFL PrimeTime, Baseball Tonight
analysis is ESPN’s core competency
advertising revenue for these programs are among
the industry’s highest
Implications for ESPN
The cost of sports content is escalating
large network competition drives up costs
ESPN should focus on delivering cutting edge
analysis, commentary, and interactivity instead
of broadcasting content
in-line with ESPN’s history and competencies
keeps in mind the implications of broadband and the
demand for compelling content
ESPN’s focus on analysis
Partnerships and alliances (co-opetition) with
traditional sports broadcasting networks
Provide interactive media applications (Praja),
fantasy leagues, and discussion forums
Video content from partners surrounded by
ESPN’s interactive applications and analysis
Becoming the “Bloomberg of sports”
The Goals
Short term:
leverage competency in sports analysis
interactive service through traditional
Internet connections
Long term:
real, live interactive television when
broadband delivery becomes feasible and
widely-available
The Product
Streaming video content of game action
(provided initially by ESPN or ABC Sports,
and eventually by partnerships with
networks)
Surrounded by ESPN analysis and
interactive content
Critical Issues Grid
Focus
Environments
Political
Company
Industry/ Ecosystem
Infrastructure
 Cross-branding networks
 Lawsuits brought by other
networks
 What are the current
laws, copyrights
agreements between
content providers
 Internet/broadband vs.
traditional broadcast
media. Does the
convergence require a
change in either side?
Behavioral
 Sharpens focus on
competencies of sports
analysis
 How value-added is this
service? What other
sources provide same
content?
Economic
 Subscription vs. advertising
revenue. What's it going to
cost?
 Impacts to existing
revenue models. Will it
dilute advertising or will
it create highly targeted,
more valued advertising?
 When will broadband
be widely accepted and
economically feasible
Social
 Reinvent yourself as the
Bloomberg of sports. Do
they want to be content or
value-added aggregate
(Bloomberg)
 Is this an acceptable form
of content? And if so,
when will this be
accepted?
 Gen-Y, baby boomers;
For the sports fan, is
this too much or is this
heaven?
Technological
 What internal resources need
to be committed to it? What
quality is needed (interface,
picture quality, analysis)?
 How do you converge the
middle mile, i.e., getting it
from the broadcast pipe to
the broadband pipe?
 When will broadband
be available? When
will interactive TV be
available and accepted?
Critical nodes in ESPN’s
Hugin Model
Acceptance of new product by users
Ability to cross-brand content (from
broadcasters) to ESPN site
Revenue model: subscription v. advertising
Hugin!
Conclusions
Broadband is inevitable--act early
Costs of going forward with the project are
relatively negligible
In almost any case, the project will be
successful
Natural step in ESPN’s evolution