NEW YORK — ESPN, accused of soaking cable operators for stratospheric license fees, has decided to give back some ad time.
Cable systems will be able to sell an extra 30-second spot in each hour of “Sportscenter,” on top of the two minutes they already get, starting in March 2000.
$75 million influx
Since the show runs live four times each weekday and five times on Saturday and Sunday plus numerous repeats, ESPN’s cable-system affiliates will get about 6,000 additional 30-second spots to sell to local advertisers each year, funneling an estimated extra $75 million into cable system coffers.
But an executive of one mid-to-large-sized cable operator, who requested anonymity, said the extra 30-second spots aren’t enough. At best, the executive said, it might bring in an extra $1 million a year. An operator pays ESPN about $15 million a year in subscriber fees. The next highest network, TNT, costs about $10 million.
ESPN’s response to criticism of its high rates is that the two minutes an hour that operators get to sell is worth more than a similar two minutes carved out by any other cable network. Citing a 1998 study by Bortz Media & Sports Group, ESPN said more than 20% of all local ad revenue harvested by cable systems comes from a combination of ESPN and ESPN2.
‘Soften the blow’
Lin Harris, VP of sales and programming for Multimedia Cablevision, a multisystem cable operator, said, “We gave ESPN a lot of grief for its price increases, which were a shock to every operator’s system. ESPN is clearly trying to soften the blow a little bit.”
“We’re not going to look a gift horse in the mouth,” said Frank Hughes, VP of programming for the consortium National Cable TV Cooperative.
But he said more than a third of the cable systems in the consortium are so small they don’t have the technical capability to insert local commercials within the two minutes an hour they get from the ad-supported cable networks.