As ESPN Looks To Stay On Top, Challenges Are Clear

BRISTOL — It's altogether fitting that the first event at ESPN's colossal Digital Center 2 looked to the future as the company faces more than the usual challenges.

DC2 is still mostly a shell, at least seven months from opening as the new home of “SportsCenter” and other shows. But last week, ESPN executives, anchors and top producers invited 40 reporters into the main studio space for a look at what the technology marvel will mean to the sports media giant — starting with an animated video showing that very room in full use.

Nothing odd there. Famously, ESPN has grasped the future aggressively since it launched in 1979 in a half-finished studio a few hundred yards away.

Changes are all the more intense these days, as the Walt Disney Co. subsidiary brings on some high-profile personalities, including its controversial former anchor Keith Olbermann; launches the SEC Network to showcase college football's dominant conference with a just-announced schedule for 2014; and fills DC2, whose $150 million price tag the company won't confirm, with electronic wizardry of the sort we've only seen in sci-fi and the National Security Agency until now.

But there are two ways of looking at the picture. The first is that ESPN is unstoppable, with 4,000 employees in a hometown that company president John Skipper spoke about in romantic terms. This collection of networks and websites is the undisputed champion of sports content at a time when content reigns in the screwy world of closed capitalism we call cable TV — where sports, as Skipper said, is the only way to bring the nation together.

The other view has the sprawling ESPN in a powerful but vulnerable position. A round of layoffs this summer reminded ESPN that it's a brutal world out there, and even a business that commands a reported $5.50 a month from each of 98 million households that get the flagship network has its limits. Going after that endless gold, Fox just launched the Fox Sports 1 network in direct competition with ESPN.

Moreover, as a new generation of fans comes of age with less TV and more digital devices, ESPN's business model could face disruption by losing some of that coerced cable money, by seeing new competition from the likes of Google, or even by missing a wave — though for now, ESPN is well-positioned digitally.

Finally, as ESPN looks to expand globally, it's finding that a narrower landscape — soccer and more soccer — is harder to dominate than ESPN had imagined.

‘Happy For Them'

Skipper is the picture of steady-handed confidence in all this, a tall Southerner with updated charm that includes hip glasses; calm, but willing to show some swagger. When a journalist asked him to react to the reported 23 cents per household that the fledgling Fox Sports 1 channel commands — a disappointing figure that Fox reportedly hoped would rise sharply before its launch — Skipper put on a smile.

“I'm happy for them.”

Locker room posting alert! Red Auerbach would have cringed if one of his Boston Celtics said something like that about a Lakers misfortune. And now, somewhere in a Fox studio, Skipper's comment lives on a bulletin board.

That's fine with Skipper, fine with ESPN's culture. “We like competition. It's always a way to make us better,” he said.

But he added, “Our goal is to have the best competition for ESPN come from ESPN.”

Enter Olbermann, whose 11 p.m. show on ESPN2 will launch Monday night. Olbermann exited ESPN as a star anchor 16 years ago with harsh words for the network and for Bristol, which he called “godforsaken.” So, no, he won't return to the city of mums for his show, which will originate in New York.

Skipper, who spoke in a conference room, not in DC2, said in a response to my question that when he personally courted Olbermann, he never even raised the notion of a return to Bristol for the sharp-tongued political commentator.

Speaking of politics — the third rail of American sports — that's out for Olbermann.

“He wants to do a sports show, we'll let him do a sports show,” Skipper said. “When sports does bump up against other things, we're OK with that. ... But we're not covering gun legislation and he's not veering off into politics.”

We'll see about muzzling Olbermann. Speaking of competition, Olbermann's show will bump up against Jon Stewart's “The Daily Show,” not to mention one of ESPN's most popular “SportsCenter” slots. Skipper said that Olbermann does for sports what Stewart does for news, but that he didn't think the two shows would take many viewers from each other. Again, we'll see about that.

ESPN is punching up its Los Angeles and New York studios, but as for Bristol, Skipper was surprisingly effusive.

“It's a big part of the culture. You kind of have to get Bristol to understand ESPN,” said Skipper, who joined ESPN in 1997 at the magazine. “It really does ground people. … This is working class, salt-of-the-Earth America, and we're proud to be here.”

That's reassuring for us in central Connecticut, all the more since the recent layoffs, a rarity for ESPN, didn't hit Bristol especially hard. About 125 people in the hometown were let go out of a worldwide job cut of more than 300, which included the elimination of some unfilled positions. Skipper portrayed it as “a significant look at how we manage our people and resources.” That means the company stopped doing a few things, including 3D TV, Skipper said.

But any broad layoff is also about pushing efficiency, and that's a scary idea if you think about it as a recurring exercise, as it is at so many firms. As Skipper spoke, word emerged of 175 layoffs at ESPN's sister Disney company, ABC.

Skipper, once again, was a calming voice. “It was the least fun thing I've had to do in this job,” he said. “It was very difficult culturally at this company. It is not something we will get used to doing.”

In fact, he said, ESPN will remain a growth company, easily meeting the targets it set to add 200 local jobs between 2011 and 2016. “We will shortly have more employees than we have ever had,” he said.

Who's The Star?

The highest-profile ESPN staffers, the anchors, are surprisingly numerous — 42 of them appear on the nearly around-the-clock “SportsCenter” shows. And with the technology enabled by the new Digital Center 2, ESPN intends to let those anchors punch up their on-air personalities.

For highlights, “We will have the ability to not always go to a full-screen, to incorporate the anchor into the show more,” said Mark Gross, senior vice president and executive producer.

Looking farther ahead, ESPN is already the leader in live sports events online at its ESPN3 network. But Google, Apple and others could look to compete directly in that space. Skipper, again the calming influence (the pattern is clear) doesn't see a major shift in viewer habits. He says this is the one and only “golden age of television,” and that the much-ballyhooed migration from cable is driven by incomes and economics, not lifestyles.

“Almost everyone who has cut the cord would like to re-establish the cord if they could afford it,” he said.

Still, even a modest rise in direct online events gives ESPN yet another front to cover.

One illustration of ESPN's immense reach and the challenges that come with it happened Thursday, when ESPN ended its involvement with the PBS “Frontline” show about the NFL's handling of players' head injuries. ESPN said it made the move because it didn't have enough editorial control over the project, which is set to air in October. The New York Times reported that the NFL pressured ESPN to pull out, a charge the league and the media company both deny.

Skipper had said the day before that ESPN prides itself on working with sports leagues as partners while also covering them as journalists.

Whatever the reason for ESPN's move, it highlights the sensitive position created by the company's ubiquitous involvement in sports media.

All of it, together, raises a question about focus. Here we have a media company with six main TV networks, an online network and a universe of web pages, a magazine, a radio network, a studio full of big personalities who cover huge stars, working for a media business whose technology has star power itself. In addition to Olbermann, ESPN has snagged analytic blogger extraordinaire Nate Silver from The New York Times, who will enjoy a lot of freedom.

Is there not a danger, I asked the ESPN panel, that the ship gets too unwieldy with too much star power?

“At the end of the day it's still about the content that we produce,” Gross said. “The beauty of this place, it's high-volume, high-octane. We take a bunch of risks; some work out, some don't. It's all about the content. That's how we prioritize.”

Rob King, the senior vice president overseeing digital content, added, “We focus on fans.”

And for “SportsCenter” anchor Steve Levy, challenges such as Fox Sports 1 are great for focus. “If you've seen me the last three nights I was absolutely pumped up,” he said. “A lot of us got into my end of the business because we can't play sports, but that doesn't mean we're not competitive.”

He's on the 11 p.m. show. “As far as I'm concerned, that's the biggest show in the building. ... I'd like to stay right where I am and keep going.”

For him, and for the most valuable media brand in the world, the position is enviable, and the challenge is clear.

Visit to read The Haar Report.

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