Introduction: The Biggest "Business" Story in Sports
The headline read, "25 Years Ago, The Biggest Story In Sports Didn't Even Make The Sports Page." Today, sports coverage is a 24-7 media phenomenon and ESPN is the brand and the sports outlet synonymous with nightly highlights, morning updates, athlete interviews, must-see games, and major sideshow events like the ESPY's and the NFL Draft. When ESPN put its full-page 25th year anniversary ad in the New York Times on September 7, 2005, it was calling attention to the impact the organization has had on changing the nature of the sports media game. As Chris "Boomer" Berman stated in the forward to ESPN 25 (A book of 25 years of Sports Highlights) "History now tells us that the television sports landscape was forever changed ; Funny though; those of us who worked at ESPN back in the fall of 1979 and the beginning of the 1980's weren't so sure."
At first it's hard to even remember how incredibly different the business of covering and broadcasting sports used to be before the arrival of ESPN in 1979. Remember when ABC's Wide World of Sports (... The thrill of victory, and the agony of defeat...!) was the weekly outlet for sports fanatics? Remember when the best you could do for a recap of the night's games was watch the scores and highlights crammed into a few spare minutes between news and weather on your local television channel? Thirty years ago, sports coverage was produced as though the topic was a sidebar unworthy of serious news time. That mindset shifted when Bill Rasmussen, an unemployed sports announcer, and a group of committed sports junkies in Bristol, Connecticut decided to lease unwanted satellite transponder space to broadcast Connecticut college sports and New England Whalers' hockey games. Before the "Entertainment and Sports Programming Network" even launched, the dream of sports coverage broadened and went national. Fans who loved sports – the types who watched prime time games, late night games, pro games, college games, amateur events, and anything else that involves uniforms and competition – couldn't get enough.
Today, ESPN is the most powerful and prominent name in sports media. The Bristol campus – and who could have envisioned Bristol as the center of the sports world? – has 27 satellite dishes feeding more than 97 million subscribers as one of cable television's biggest networks. The channels have multiplied fourfold and gone international, putting them in over 180 countries – blowing past the objections of those who argued that even one 24-7 sports channel was unsustainable – to include ESPN2, ESPNews, ESPNU, ESPN Desportes, and ESPN Classic. Piling on, ESPN the Magazine, ESPN the store, ESPN Zone Restaurants, ESPN.com, ESPN Books, ESPN Original Entertainment (Movies and Shows), the X Games, ESPY Awards, and many other brand extensions keep fans loaded up on the sports stories, statistics, communities of sports fans, and memorabilia they voraciously consume. Although parent-company Disney reports on the revenues of their media group and cable groups, it does not report out the economics of ESPN per se. The consensus view of Wall Street analysts', however, is that the combined revenues of the ESPN enterprise, conservatively speaking, totaled roughly $5 billion in 2007, with profits in the range of $2 billion. At a New York conference in 2007, UBS announced that they had determined ESPN value to be $28 Billion. They went on to say that ESPN accounted for 40% of Disney's $70.7 billion market capitalization.
While the appetite for sports and the suitability of cable television as an outlet strike most of us as self-evident now, the traditional networks completely missed the early opportunities ESPN scooped up. In part, that innovative vision explains the early success of the organization in staking its large claim on the sports wilderness, but it does not explain the sustained growth over three decades nor the ability of ESPN to maintain market dominance in the face of new and heavily-backed competitors. If jumping into the game early was the primary requisite for long-term success then Starbucks would be only one of many globally recognized coffee shop chains, and ESPN would be just another jumble of letters providing sports entertainment. There were other ESPNs around the country, known by other initials, such as CNN/SI, which was Ted Turner and Time Warner's CEO, Gerald Levin's attempt at Cable Sports, which closed down after six years of operation. So, how did the ESPN we know today succeed? Thirty years ago, ESPN may have been the biggest sports story not to make the front page, but the even bigger story, a story that remains untold, is how ESPN managed to sustain its growth, innovation, and brand in a highly competitive and rapidly evolving marketplace.
That's a business and leadership story, not a sports and media story, and I aim to tell it in this book.
