Editor’s Corner—The probability of success for ESPN+

ESPN+ is clearly not being positioned to be an advertising and subscription revenue-generating machine at the same scale as ESPN’s networks. (ESPN)

After months of developing and planning, ESPN’s direct-to-consumer streaming product, ESPN+, is debuting on April 12. Now it needs to find an audience.

ESPN+ won’t overlap with ESPN’s networks, so it will essentially serve as a platform for everything that ESPN deemed not worth putting on television.

Following the formal announcement earlier this week, prospective ESPN+ users now have a better idea of what they can expect to see on the new platform and if it will be worth $4.99 per month.

ESPN+ will offer one MLB game and one NHL game per day throughout the regular seasons for each sport. It amounts to more than 180 baseball and hockey games each.

The service will also include a year-round boxing schedule, more than 250 exclusive Major League Soccer matches and college sports including football, basketball, baseball, softball, soccer, track & field, gymnastics, swimming & diving, lacrosse, wrestling, volleyball, golf and more from conferences including the America East, ASun, Big South, Big West, Horizon, Ivy League, MAAC, MAC, MEAC, Missouri Valley, NEC, Southern Conference, Southland, Summit League, Sun Belt, WAC and many more.

The service is also promising more than 100 days of coverage from 31 PGA Tour events, hundreds of tennis matches from tournaments like Wimbledon and the U.S. Open as well as hundreds of rugby and cricket matches.

This week, ESPN also announced a 10-year deal with the Ivy League and said that most of that content will find its way onto ESPN+.

In addition to all the live sports, ESPN+ will include original shows and films, exclusive studio programs and an on-demand library. So will it be enough to entice subscribers?

Media analyst Alan Wolk said it will be compelling for sports superfans and predicted the service will attract more people who already subscribe to ESPN’s traditional networks.

“It doesn’t look like it’s going to be a huge thing. But at $4.99, someone who’s really into sports may go for it,” Wolk said. “But I don’t know how many of those people there are any more, or how many of those people are tech savvy enough.”

Parks Associates analyst Brett Sappington agreed that it will be compelling for some customers, particularly due to content that won’t be available elsewhere like MLS games and some of the college sports. But he questioned how valuable the service would be to fans of the MLB and NHL.

“If you’re a sports fan, are you interesting in a generalized sports service with little pieces from everywhere?” said Sappington, guessing that baseball and hockey fans would likely go for MLB.TV or NHL.TV.

ESPN+ will be offering MLB.TV for an additional $24.99 per month and said it will do the same with the NHL beginning with the 2018-2019 season.

Both Wolk and Sappington noted that ESPN+ is being positioned as complementary to ESPN’s networks. Sappington added that for most of ESPN+’s content, if it was popular enough to get advertising money, it would be in ESPN’s top eight channels.

So ESPN+ is clearly not being positioned to be an advertising and subscription revenue-generating machine at the same scale as ESPN’s networks. Which begs the question: how will Disney and ESPN measure the success of ESPN+?

Wolk said Disney will still likely look at revenue and subscriber growth as key metrics for ESPN+’s performance, but he said Disney will also watch for how much time subscribers are spending on the platform and observe churn rate particularly as certain sports enter offseasons.

Sappington noted that churn on ESPN+ is not the necessarily the worst thing in the world because at least ESPN finding a way to temporarily monetize some of the sports that were sitting on the shelf.

Beyond the traditional performance metrics, Wolk noted that ESPN+ could serve as an important live sports streaming testing ground. Streaming live sports is still a challenge, even for services that have been doing it for years. If ESPN+ can live stream sports with consistent quality, it could make Disney-owned BAMTech, the backbone for ESPN+, come out looking like an attractive option for services still looking to master the art of streaming sports, Wolk said.

With Disney’s decision to form a new direct-to-consumer and international business segment, one that will house ESPN+ as well as several other parts of Disney, it will be at least a year before clear quarterly comparisons will be available for tracking ESPN+’s performance. And it’s unclear what ESPN+ metrics Disney will make available and when.

For now, it will be a waiting game to see if ESPN+ and its mixed bag of sports can draw in a meaningful amount of subscribers and ultimately end up as smart move for Disney and ESPN. - Ben | @fierce_video