Bob Iger explains why he never spun off ESPN: ‘Imagine if it ended up in Netflix’

It’s been only a few months since Bob Iger stepped away as Disney CEO, making way for Josh D’Amaro to run the company. But even in that short span, questions about the future of ESPN have come to the forefront.

ESPN has long been viewed as a potential spinoff candidate for Disney, especially as the headwinds facing the cable television business continue to pick up. So it made sense that with new leadership atop Disney, the question of whether ESPN could be spun off would again become a topic of conversation.

As it stands, D’Amaro will reportedly keep ESPN under the Disney umbrella, though those plans “could shift” before the calendar flips to 2027, another report indicated in April. The case to spinoff ESPN is clear: the network faces an uphill battle as consumers continue to cut the cord and companies like Amazon and Google enter the market for live sports rights. Getting rid of an asset that most investors would characterize as in decline would likely have a positive impact on Disney’s stock price.

But ESPN, which has been owned by Disney for 30 years, is still an integral part of the company’s brand. And for Bob Iger, the thought of seeing ESPN get scooped up by one of his chief competitors was too much for him to bear. In his first profile since stepping down as Disney CEO, Iger explained his rationale for keeping ESPN.

“Imagine if it ended up in Netflix? Is that a good way to make a quick buck and completely discount future value and importance to the company?” Iger told the Financial Times.

ESPN has made several forward-looking moves recently in an attempt to buck the decline of cable. For one, it launched ESPN Unlimited, taking its flagship networks direct-to-consumer for the first time in its history. The streamer is a key pillar of Disney’s all-encompassing bundle with Hulu and Disney+. ESPN has also taken steps towards becoming a hub for live local sports, hosting both MLB.tv and local NHL games on its platform. And, of course, ESPN purchased NFL Media by giving the league a 10 percent equity stake in the network.

For Iger, holding onto ESPN wasn’t a bet on the future of cable, but a bet on the future of sports as an entertainment product that consumers are willing to pay for, regardless of the means of distribution. That’s still a challenging business when massive tech companies are poking around for broadcast rights, but it’s a viable outlook if you’re looking at the long-term value a brand like ESPN can have.

“There’s a reason why ESPN is referred to as the worldwide leader in sports. It’s a media property that, in my mind, has actual fans,” NBA commissioner Adam Silver told FT.

Funnily enough, that’s precisely why a sale of ESPN remains an attractive option. For now, however, we’ll just wait and see.