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posted by martyb on Tuesday May 02 2017, @02:47PM   Printer-friendly
from the cheaper-circuses dept.

ESPN, which laid off 100 people this week, has a multitude of problems, but the basic one is this: It pays too much for content and costs too much for consumers.

That didn't used to matter because, thanks to the way the cable industry "bundled" channels, cable customers were forced to pay for it even if they never watched it. Now, however, as the cable bundle slowly disintegrates, it matters a lot.

[...] But it's a pipe dream to think that ESPN will ever make the kind of profits ($6.4 billion in 2014) that it once did, for two reasons. First, as is the case with so many other industries, the internet has both shined a light on the flaws of the cable model and exploited them. What was the main flaw of the cable model? It was that consumers had to pay for channels they never watched.

And now they don't.

It turns out that there were lots of people, including sports fans, who resented having to pay for the most expensive channel in the bundle. The popularity of streaming led to "cord cutting," but it also caused cable companies to begin offering less expensive "skinny bundles," some of which don't include ESPN.


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  • (Score: 0) by Anonymous Coward on Tuesday May 02 2017, @07:46PM

    by Anonymous Coward on Tuesday May 02 2017, @07:46PM (#503090)

    What is the difference between (Stadiums and big amusement parks if those are subsidized too) and (Chick-Fil-A and Costco)? Scale? Do the profits for the private ownership not scale as well?

    The difference is that some people are batshit crazy about sports. Subsidizing it with taxpayer money is one of those "ends justifying the means" things if it brings sports to the undeserving masses. The fact that it is a big handout to a business that produces nothing of value but entertainment is lost on them.