Was ESPN bigger than Disney itself at one point in the previous decade? Former network president John Skipper said that was absolutely the case.
Skipper was on the Share and Tell edition of Pablo Torre Finds Out last week, where he, Torre, and David Samson were talking about ESPN’s role in the next NBA media rights deal. John said he didn’t put much stock into reporting that ESPN and Warner Bros. Discovery, which owns TNT, could be priced out of the league’s new contract whether it be because they didn’t want to pay what the NBA was asking or they couldn’t afford it.
Skipper said ESPN will do everything possible to keep the NBA in its portfolio of live sports offerings.
“The fact of the matter is, these are existential rights for ESPN,” he said. “They have to have the NBA and it’s pretty close to existential to TNT. I don’t know if they have to have the NBA, but I think they do. Again, there’s a lot of stuff here that we’re assuming is being correctly reported.”
Last week Disney provided some insight into ESPN’s finances. It’s been speculated that the move is part of plans to secure strategic partners for when ESPN becomes its own standalone offering.
Skipper said it was a decision that was likely made begrudgingly for a couple of reasons.
“One, they did not want the leagues to see those numbers because they would have asked for more money and they did not want the distributors to see how much money ESPN was making,” he said. “So they aggregated the media earnings. I also actually believe they did not want the rest of the company to know how much of the value of the company was ESPN.”
Torre asked Skipper to just provide some context on just how big the network was in its heyday.
“ESPN was a bigger, more profitable company than the studio and the parks put together,” Skipper responded.
The discussion with regard to NBA media rights circled around TV ratings at one point. Skipper said ratings have little to no bearing on money coming in or negotiations. He said the money is the money, and whatever price gets settled on is the price that gets paid regardless of ratings.
“We didn’t get paid for ratings other than advertising,” Skipper said. “And if you look at the numbers just released by the Walt Disney Company, they had just north of $10 billion in distribution fees. Those don’t change a cent based upon ratings. They’re going to get paid next year, ten-point something billion dollars if nobody watches.”
