Jimmy Pitaro and Bob Iger have spoken nearly every day since Iger returned as head of the Walt Disney Company according to Bloomberg. The bulk of their conversations center on the future of ESPN and when the network leaves linear television and becomes a streaming service.
“We’re going to get to a point where we take our entire network, our flagship programming, and make it available direct to consumer,” Pitaro said. “That’s a ‘when,’ not an ‘if’….We’re only going to do it when it makes sense for our business and for our bottom line.”
There is no rush to leave the traditional cable bundle. Although the number of US households that use cable or satellite TV continues to shrink, ESPN generated $28 billion in revenue for Disney last year.
But there is an eye toward the future. ESPN has already been emphasizing streaming rights in deals with college conferences, Major League Baseball, the NFL and the NHL. They are expected to be a major part of this summer’s negotiations with the NBA as well.
“I’m confident we’re going to see eye-to-eye on how to prioritize streaming,” Pitaro told Bloomberg of what he anticipates in trying to extend that broadcast contract.
Any decision Disney makes about the future of ESPN will be informed by the numbers. The network has lost 25 million subscribers in the last decade and ESPN+ about $400 million during the last fiscal year according to Wells Fargo analyst Steven Cahall. While the company still has plenty of money, ESPN will be forced to stand on its own for the first time later this year when it becomes its own division of the Walt Disney Company, a move many speculate signals a coming spin-off.
