ESPN Chief John Skipper Addresses Retrenchment: 'ESPN Is Responding to Change'

Allen Berezovsky/WireImage
John Skipper

"The current environment forces us to be realists as well as optimists," he told media buyers Tuesday at the network's upfront.

ESPN president John Skipper immediately addressed the elephant in the room Tuesday at ESPN’s annual upfront pitch to media buyers. “Let me be up front at this upfront — ESPN is responding to change, and we are making changes from the most dramatic position of strength,” he told buyers gathered at the Minskoff Theatre in Times Square.

Skipper added that sports fans are, by their nature, optimists. “It follows that we at ESPN are optimists,” he said. “Of course, the current environment forces us to be realists as well as optimists.”

The presentation, which opened with a New Orleans second line, comes just weeks after ESPN cut 100 employees on its talent roster, including Ed Werder, Trent Dilfer and Sara Walsh, who was due back from maternity leave when she was let go. The network re-signed other popular personalities, including Hannah Storm, Sage Steel, Steve Levy, Kenny Mayne, John Anderson and John Buccigross. ESPN also will roll out a new multiplatform initiative around its flagship SportsCenter franchise. SportsCenter Right Now will include updates to digital and linear platforms during the day as well as during halftime of primetime events.

The cuts, said ESPN executives, will allow the network to refocus its resources on cross-platform content in a sports media environment that is quickly evolving from a linear play. ESPN, like many cable networks, has steadily lost subscribers over the last several years. The network is down from a high of 100 million households in 2011 to fewer than 88 million today as consumers are cutting the cord on expensive cable TV packages and opting for skinny bundles and an array of streaming services. ESPN has relied on those rich subscriber fees — close to $8 per sub per month, more than any other ad-supported network — to underwrite the very rich live sports deals that are critical to its brand. The network pays more than $7 billion a year in live sports rights, including $1.9 billion for Monday Night Football.

ESPN is still an enormous profit driver for parent Disney. And Skipper stressed that live sports is still core to the ESPN brand; he noted that ESPN’s primetime is up double digits in the first quarter, and that the network’s digital products reach 100 million people a month.

The presentation included appearances from ESPN personalities Scott Van Pelt. Suzie Kolber, Jon Gruden and Randy Moss and sports stars including Paul Pierce and a pregnant Serena Williams. And Skipper stressed that the network’s personalities remain an integral part of the ESPN brand proposition. “Fans understand the distinction between just getting a score and getting it from a personality with a distinctive point of view,” he said. “In the end, high-quality content matters, live matters and, of course, brand matters.”

The network also announced that Peyton Manning — the two-time Super Bowl champ and Papa John's pitchman — will host the 2017 ESPY Awards. The former NFL quarterback will be joined by top celebrities from sports and entertainment to commemorate the past year by recognizing major sports achievements, reliving unforgettable moments and saluting the leading performers and performances. The 25th annual ESPYS will be broadcast live on ABC on Wednesday, July 12, at 8 p.m. ET from the Microsoft Theater in Los Angeles.

SportsCenter anchor Kenny Mayne concluded the presentation with a comic turn — and an entrance from the rafters on wires — with a light roasting of the advertisers in the audience: "It’s time to face the ugly truth: The number of people who are watching TV the way they used to watch TV might have declined. Minimally. Like a rounding error."