tl;dr : Because their current deal with cable & satellite carriers calls for a 6.5% carriage fee increase every year, ESPN's annual carriage fee income will continue to increase between now and 2020 -- unless the annual number of cord cutters increases by 50%, year over year. And that rate of cord cutting seems rather unlikely at the moment.
Also, if ESPN became a premium channel, the network would need 40.7 million subscribers at $14.95/month, or 30.5 million subscribers at $19.95/month, to make as much as it makes now in annual carriage fees -- about $7.3 billion -- from ESPN, ESPN2, ESPNU, and ESPNEWS. And it probably couldn't get away with selling $3.3 billion in ads if it went premium.
So yeah, big media really isn't going to change until we all stop giving it so much money.
I was just thinking the same thing, especially given Fox's 9-year, $10-billion deal with the NFL that goes into effect next March. Pretty sure Roger Goodell would remind Chase Carey of a few 11-figure cancellation fees in that contract if Fox shuts down its broadcast network. The NFL wants as many eyeballs as possible.
The NBA, on the other hand, makes all its money from ESPN and Turner. If ABC disappears, I'm not sure the NBA would miss it that much, save for Xmas-day hoops and the Finals.
It wouldn't surprise me in the least if Logan and Personal Audio were merely Big Media puppets at work here, trying to squash alternative programming. This might explain why Adam Carolla is the first target, beyond the fact that he's the biggest podcaster. After all, he rejected Big Media to strike out on his own. Wouldn't surprise me if they went after Glenn Beck next -- although Big Media *fired* him, which is a little bit different.
Say, does Newegg have a podcast? Think they could start one?
...is to shine more light on big media's attack on RSS, something that Aaron Swartz helped to develop. The owner of patent troll Personal Audio LLC has had contractual relationships with lots of big media companies.
WatchESPN is a TV Everywhere package that requires you to have a cable TV subscription with ESPN in order to access it. It is NOT a stand-alone service, and for the reasons I put forth here, it probably never will be. As for ESPN3, it's a supplement to the mothership networks, not a replacement.
Could ESPN set up an online-only service, charge $19.95/month for it, and find millions of customers? Absolutely.
Will ESPN do that? No. And there are tons of reasons why.
1.) Subscriber fees. ESPN and ESPN2 alone are in 100 million homes, and ESPN receives $5.31/month from every subscriber. That adds up to about $6.37 BILLION/year. This money covers the TV rights to pretty much all the pro and college sports ESPN shows, and they still have about $2B left for production costs -- to say nothing of advertising and merchandising income.
Do 100 million people in the U.S. watch ESPN? Of course not. But they're all paying for it just the same. How many of those people would cut the cord for a stand-alone WatchESPN service? Probably not the 26.6 million or so they need to equal what they rake in from subscriber fees.
Which brings us to reason #2.
2.) Distribution. Pay-TV has a ready-made, high quality distribution network already in place. Setting up an online-only service of similar quality would cost a LOT of money. Why spend extra to duplicate what's already been done?
And speaking of distribution...
3.) Backlash. Pay-TV companies would tear ESPN apart if they introduced an online-only service -- starting with Comcast, which owns NBCU, which owns NBC Sports Network. You think Comcast wouldn't start breaking the bank to outbid ESPN for every TV rights contract up for renewal? You think Comcast wouldn't have its engineers do some dirty throttling tricks to make WatchESPN nigh-unwatchable -- and demand much lower subscriber fees in exchange for "clogging up our network"?
Those three reasons alone are why sports on TV is here to stay. Pay-TV has us sports fans by the balls, man.
The entire cable TV system is predicated on making sure the beast gets paid. Want to watch Monday Night Football at home legally? You'll have to pay for Fox News, TLC, and any number of other networks filled with programming you might find distasteful. Sorry. That's the bargain.
Which brings up a very important point -- HBO is owned by Time Warner, a bastion of old media thinking. Time Warner also owns Turner Broadcasting. Keeping HBO as a cable-subscription service allows Time Warner to earn more money for CNN, TNT, TBS, TruTV, Cartoon Network, and all its other cable properties -- many of which, incidentally, would also be vehicles for distributing WB-owned films, allowing those films to generate more revenue. (Even if they never make a profit, according to the official ledgers.)
Pay TV is a huge racket, and the handful of multinational corporations at the top of the heap -- Disney, Time Warner, News Corp., Comcast, Viacom -- can and will keep this racket going for as long as they possibly can. Sure, we'd be glad to pay for HBO and ESPN and certain other networks separately, but offering those services online would likely kill the beast, and these beasts aren't ready to die yet.
The cable companies and telcos that they're bypassing are also the ISPs, and they could easily throttle the online traffic HBO generates in retaliation. Whether that's legal or not won't matter much to them when they can afford the lawyers.
There's also the fact that HBO very likely makes a ton of money from people who forget to cancel their 3 free months of service and get billed for a month or two before finally canceling -- not dissimilar to Blockbuster's dirty "late fee" practices, which Netflix highlighted and used to bury Blockbuster. Netflix will have a harder time exploiting this weakness with HBO (and Showtime), though, because their primary business model doesn't hold HBO and Showtime as competitors -- not yet, anyway.
i still dont understand why everyone is so afraid of the entertainment industries.
Dude, Comcast owns NBC Universal. They're not afraid of the entertainment industry. They are the entertainment industry.
And as for the rest of the cable company ISPs, they get nearly all their product from the entertainment industry, so they probably had to agree to this deal or explain to their customers why half their channels disappeared all of the sudden. This is especially true if Disney was involved. Say goodbye to most of your customers if you lose ESPN.
Actually, Obama sang Let's Stay Together at the Apollo Theater, which is fully licensed with ASCAP, and therefore, it was perfectly legal for Obama to sing that song in that venue.
What BMG is claiming is NOT legal is for anyone to use a recording of that song in a YouTube video. And that appears to cover a recording of ANYONE singing that song, be it the President of the United States or that Anonymous Coward. (Or me, but I struggle to hit that high A, so I tend to sing "Love and Happiness" instead.)
Therefore, President Obama is NOT the pirate. So who ARE the pirates? Associated Press, CBS News, ABC News, The Young Turks, and whatever SuperPAC made that Romney ad. Those first three are large media conglomerates, all of whom have demonstrated great eagerness to sue anyone who "illegally" distributes their "intellectual property". They've all been labeled pirates. And I guarantee you they won't do a damn thing to fight this, because they want to make sure they have the right to shut down and/or sue anyone re-enacting 9 seconds of their crap, too.
I've also stopped going to the movies and watching episodic TV. Most of what I watch on my TiVo comes from the web (TWiT, TED, Rev3, several YouTube channels , etc.) rather than cable, which I only keep because I'm too big a sports fan to let it go completely. (Though I am weighing some options on this end.)
However, as a longtime music podcaster who *does* seek out music from small indie labels and unsigned artists to share with people, I'd be remiss if I didn't suggest giving indie music podcasts a try, because there's LOTS of great music out there that has no ties to big media. Start at musicpodcasting.org and go from there. You'll be glad you did.
Only too easily distracted by the shiny to get organized over this. Most people just want to be entertained, and the crap the movie biz dishes out is, shockingly, still mostly good enough for them. If people stopped giving the industry money, things would change, but we haven't convinced enough people to do that yet.
...is a cable company that owns NBC Universal, so it has no qualms with going along with this. Most ISPs -- including Time Warner Cable, the horrible company I'm stuck giving my money to right now -- are huge corporations that couldn't care less about their customers or proper customer service. They're probably getting enough cash from Hollywood that the loss of their customer bases hasn't even crossed their minds. This can't possibly end well for anyone.
Ummmm... it helps UFC's bottom line because the bar is BUYING the stream legally and showing it publicly, and bars usually have to shell out a LOT more than home viewers for UFC streams, because they bring in people who don't want to pay $50 a fight but are fine paying $10-15 for beer and wings. How is any sort of "stealing" happening there?