The Sports Bubble Is About to Pop
<i>Don’t buy ESPN’s PR talk that its 7 million-household dip in subscribers is just a blip.</i><p><i>When ESPN was adding subscribers, the $6.50 per-month-per-subscriber it charges to every cable operator meant $78 of additional annual profit for each new subscriber.</i><p>7,000,000 * $78 = $546,000,000<p>Yeah, that&#x27;s definitely not a blip.<p>The reason this affects sports leagues is because a huge chunk of their revenue comes from TV.<p>ESPN pays the NFL nearly $2B per year[1] just for Monday Night Football - or roughly 16 games a year. That&#x27;s more than $100mm per game.<p>It&#x27;s becoming pretty clear that ESPN isn&#x27;t going to be able to afford TV rights deals like that for much longer. Which means the NFL is going to have to find someone else (there is no one else) or reduce its prices. When the sports league revenue drops, collective bargaining agreements will be disrupted and the result will be labor unrest and (potentially) team bankruptcy.<p>It&#x27;s going to be entertaining to watch the entire industry implode before our eyes. When it&#x27;s all over, we&#x27;ll be able to enjoy sports as they should be - any game, streaming for a reasonable price, no blackout dates or other restrictions.<p>It&#x27;s a shame an entire industry has to collapse to get a good user experience.<p>[1]<a href="http:&#x2F;&#x2F;www.nytimes.com&#x2F;2011&#x2F;09&#x2F;09&#x2F;sports&#x2F;football&#x2F;espn-extends-deal-with-nfl-for-15-billion.html" rel="nofollow">http:&#x2F;&#x2F;www.nytimes.com&#x2F;2011&#x2F;09&#x2F;09&#x2F;sports&#x2F;football&#x2F;espn-exten...</a>