The last few years have seen a significant shrinking of the pay-TV universe, and that was especially noticeable at ESPN this year. The last time we saw Nielsen carriage estimates for sports networks was in April 2019, with the main ESPN network in an estimated 84.6 million homes then (down from 86 million the previous September). As per Dade Hayes of Deadline, Disney reported in a SEC filing Wednesday that ESPN was in 76 million homes at the end of their fiscal year (Oct. 2), as per Nielsen estimates.
That’s well below the 84.6 million from April 2019. And most of those losses came in fiscal 2021, with Hayes noting that they cited 84 million homes for main ESPN at the end of fiscal 2020. These numbers are Nielsen carriage estimates rather than actual subscriber numbers, but those estimates are widely used, and they consider subscriptions through virtual MVPDs like YouTube TV and Hulu+Live TV as well as traditional MVPDs like cable and satellite. So ESPN is certainly down a fair bit here.
However, while ESPN dropped eight million subscribers this year as per those filings, their associated streaming service ESPN+ was at 17.1 million subscribers at the end of fiscal 2021, up almost 7 million from the 10.3 million they had at the end of fiscal 2020. Of course, cable subscribers still produce more actual revenue for ESPN; ESPN gets paid an estimated $10 per subscriber per month for ESPN and ESPN2 alone, as per a report from NBC’s Alex Sherman last month, and that’s before further fees for ESPNEWS, ESPNU, and their college networks.
By contrast, even after two price hikes this year alone, ESPN+ is $6.99 a month. And that’s before discounts from paying for a year or for paying for the whole Disney bundle. But it’s certainly notable that while they’re losing numbers on the traditional TV side, they’re seeing significant growth on the streaming side, and that may shift more as more and more marquee programming heads to ESPN+.
The other important piece of context here is that we don’t know how many subscribers other pay-TV networks lost. Thus, we don’t know if this particular ESPN drop is more heavily weighted to them than other networks, or if this is all part of the wider shift away from pay-TV bundles (traditional or virtual) towards over-the-top streaming services. We do know that ESPN still does have notable carriage with many traditional and virtual MVPDs, and that they’ve been able to use that to get their college networks carried by many providers.
The subscriber losses for ESPN are certainly notable, especially with this kind of a loss in one fiscal year. And the key question going forward will be if those subscribers continue to decline at this rate, or if the losses become more gradual. This kind of subscriber loss is certainly ammunition for the talk of Disney potentially spinning off ESPN, although Disney has heavily denied that that’s coming (and it’s unclear that a spinoff would help all that much). But the big question is where the numbers go from here, both on linear ESPN and on ESPN+, and if there are any changes to the timetable of shifting content from linear to streaming as a result.