Sports cabler ESS ailing

Programmer struggling despite strong soccer scores

SINGAPORE — While English Premier League soccer is proving a winner for Asian joint venture ESPN Star Sports (ESS), news from parent News Corp. shows the programmer is still far from breakeven.

In a fortnight that has seen eleventh hour carriage deals struck with operators across Asia, ESS’s buoyant mood was somewhat deflated by News Corp’s latest earnings report.

The service is still in debt to the tune of $21 million in the year to end June 2001.

ESPN Star Sports’ managing director Rik Dovey told Daily Variety several months ago that he anticipated the ESS joint venture would break even within two years. (News Corp. owns 50%.)

The disappointing figures, including losses of $3 million for second quarter 2001 against $1 million in earnings for the same period last year, have been variously attributed to the economic downturn, the costs of ESS’s expansion into Taiwan, and the purchase of exclusive pan-regional rights to the English Premier League (EPL) soccer.

Purchased with other partners, the three-year international rights to the EPL went for a total of $266 million.

With the Asia-Pacific region forming the largest market with 162 million out of 440 million viewers worldwide, ESS is known to have contributed a significant amount for the rights, rumoured at more than $40 million.

Not that this economic cloud is without a silver lining, for ESS has secured multiple-year carriage with Cable TV in Hong Kong where relations have been traditionally turbulent.

Similarly in Thailand, UBC has agreed to a $2.5 million deal, with costs to be passed onto its 382,000 subscribers.

With Astro in Malaysia also reaching an agreement with ESS, operators don’t want to deprive the soccer-mad and are hoping to drive subscriber numbers. In Singapore, cable operator Singapore Cable Vision (SCV) saw a triplefold take up of cable in the EPL’s debut weekend.

“Once viewers realized there really was no terrestrial distribution, they signed up for cable immediately rather than miss the soccer,” said an SCV source.

Though the purchase of this potential cash cow has for the moment negatively impacted ESS’s bottom line, it may also prove its saving grace — if it succeeds in driving Asian subscriber numbers.

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