John Skipper, ESPN’s exec VP of content, sat down with Variety recently to talk about all things ESPN, the TV sports landscape, the chances of the Super Bowl ending up on cable and what demographic the network sees as an untapped viewer base.
Q: In broad strokes, how do you see the TV sports landscape right now?
JS: I actually see sports as a very attractive segment in entertainment because it’s live. That’s why things are so active in sports right now, why ratings generally are up and why there’s generally more competition than ever for rights. Lots of companies — whether it be Turner, TruTV, FX, NBC Comcast with Versus — everyone wants in with sports because in a world where you have the ability to control when you watch something, live sports breaks through in a way that’s only going to continue to become more valuable. We’re very bullish, obviously, but our actions reflect our bullishness. We continue to buy rights, start new businesses and push into new platforms because we believe sports is a driver for all of that.
Q: Where do you see your future competition coming from?
JS: We see our competition in a number of places. I mean there is competition for eyeballs on television, for buying rights, on the Internet from social media companies and on videogames. We still think the way to break through all that competition is to own live rights and then build studio content around those live rights. That way you drive people to the network with live games and you keep them for “SportsCenter,” “SportsNation,” “PTI” and “E:60.”
Q: Do the sports leagues, such as the NFL, have you under the gun because they know how badly you want and need those rights to keep your dominance?
JS: The NFL is really good for us and we need to have it. On the other hand, we have a very broad portfolio across a lot of sports. We have significant agreements with about 30 big conferences, leagues, commissions and associations. We have a pretty good diversified portfolio, and that does help you a little bit, certainly in terms of your leverage with the leagues. We believe that the deals we have now work for us, even though some of them are expensive. We don’t do deals unless it works within our overall financial structure and offers returns we need to deliver to the Walt Disney Co. and its shareholders. While leagues have leverage and their content is exclusive, we also have leverage.
Q: With Turner quite possibly being a player for the next NFL package, do you expect prices to go up?
JS: I think there will always be competition for NFL packages. I only know what I read in the press. I actually have no inside knowledge other than it appears that the NFL has been offering other eight-game package. I think it’s highly logical that Turner would interested and NBC Comcast would be interested, as well as other parties.
Q: Years ago it was assumed a Super Bowl would never come to cable. Yet now, with ESPN holding the rights to the BCS Championship Game, could you see that happening?
JS: I could certainly envision it. It makes me happy, but I don’t see it happening in the near to medium term. The NFL has been very clear that they don’t see putting the Super Bowl in the perceivable future on cable.
Q: Did you find it surprising that NBC won the recent Olympics bid? And the timing was certainly interesting, with Dick Ebersol leaving the network right before the bidding began. It was clearly a big offer ($4.4 billion for the next four available Games, through 2020).
JS: I think whether he was there or not, it’s a very critical product for NBC Comcast. It’s core for the NBC sports brand. They’ve had it for a long time. I think with Dick Ebersol leaving, in some ways it had the opposite effect of what people thought. “Oh my gosh, Dick is gone,” and that mean the Olympics are at risk. It’s still a critical product for them whether he was there or not. I think they understood that, and that’s reflected in the price they paid. Was I surprised at the price they paid? Well, it’s clear from what we did that we believed the value was below where they paid. We couldn’t make the numbers work at anywhere near that level. Again, it might have value beyond a simple P&L for them. I believe they can use content on Versus, but we didn’t see the value they did. So yes, we were a little surprised at the price.
Q: ESPN has made a big international push lately, especially with acquisition of the Premier League. How do you see that push going forward? Is that a major objective for the network?
JS: The world’s getting smaller, of course, and we’re finding that people here care about sports that have traditionally been international. First off there’s soccer — the World Cup and next summer we’re doing the European championships. We do some Mexican soccer on ESPN Deportes. Changing demographic patterns mean people care about other sports. We had a real big success with our news and information with the cricket World Cup; huge traffic on ESPN.com. We think people are increasingly caring about international sports and we like to do more on ESPN3.com. It’s the perfect platform to do Latin baseball or any number of sports. So, yes, we are going to continue to push international sports.
Q: With sporting events starting so late now and young fans not being able to watch the conclusion of nighttime game on TV, is it fair to blame the networks?
JS: Well the research is actually completely contradictory to what people always say about this. The research tells you to go late, and, of course, most of this comes from the East Coast guys. People forget that a lot of the population in this country is in other time zones, where it’s not too late. There is no research evidence to suggest that there’s any ratings lost and, in fact, the young audience tends to pick up later in the night. Maybe 11-year-old kids are up when they shouldn’t be. We have made the decision many times to go early because we think it feels like a good idea and it’s a good PR move. In last year’s NBA Final, we put a game on at 7 o’clock and it actually hurt ratings.
Q: It feels like you’re losing a generation of fans. A game ends at 12:30 a.m. in the East Coast and they miss a lot of that excitement.
JS: I hear you and it sounds logical. Every time I try to do it, my program the department goes, “You’re going to kill the rating.” We have done it a few times because it’s good PR.
Q: Do you see Versus as your main competition right now and in gathering more sports rights, such as Wimbledon, is that part of the objective in trying to keep your distance ahead of them?
JS: Anybody’s who’s bidding against us is a competitor. In terms of resources, Fox has enormous resources, NBC Comcast has big resources, Turner does. The thing about Versus is, right now, it’s the only other 24/7, 365, multisports network. So I think that’s why people sort of go, “They more look like you than anybody else.” But lots of people are competing. I think Versus has the interest but they’ve professed they’re not trying to compete with us. But they don’t deny that they are trying to be a 24/7, 356, multisport channel, so, yeah we consider that to be competitive. With Wimbledon, we wanted to do what we just did for a long time, way before NBC decided to merge with Comcast. Rhetorically, I often say we don’t recognize the distinction between cable and broadcast. For the deal we just made with the Pac-12, Fox agreed with us. There is no broadcast package and no cable package. We’re buying games, we have a bunch of assets and we’re going to put those games on whatever assets we want to put them on. For the Olympics, while we did have a significant component of events we were going to put on ABC, our agreement with the Olympics was that we could put content anywhere. We could put it all on cable if we wanted to. So to go back to your question about the Super Bowl, while it isn’t going on cable anytime soon, almost everything else is fair game.
Q: What else is on your mind these days?
JS: We’ve made a big commitment to the West Coast over the last 2-3 years. Moved the latenight “SportsCenter” here and doing some ESPN Deportes shows from here. We also launched (website) Grantland out of here. We moved about half of our content and development group out here.
Q: What do you think the reason is behind that?
JS: We want to feel even more national. We want a presence from the East Coast to the West Coast. We’re going to have a presence in Texas starting this fall (with the Longhorn Network). We’re starting a new show in Miami and we do “PTI” out of Washington, D.C.
Q: Has there been a feeling ESPN was too Northeast in its thinking?
JS: I think that we always battle a little perception that we’re Northeast-centric. We are located in the Northeast and a lot of our employees come from the Northeast, so it would be hard to simply dismiss it entirely, but we don’t think we have any significant East Coast bias. Nobody does more West Coast, Midwest games or Southern games than us.
Q: Have you seen any a “SportsCenter” ratings bump for the West Coast broadcast?
JS: Yes, the West Coast ratings are up. They’re doing a great broadcast. We want to have a presence here. We just did the ESPY’s, and we’re starting ESPN L.A. and ESPN Deportes L.A. Demographics matter. L.A. is one of the major Hispanic capitals of this country, so that’s why we’re doing some Deportes here. We feel like there is some growth there for us.