James Pitaro Named New President Of ESPN, Replacing John Skipper

Entryway sign to the ESPN Wide World of Sports Complex, located in Orlando, FL.

The ESPN Wide World of Sports Complex, located in Orlando, FL.
Photo credit: Brazil Photo / Shutterstock

ESPN might be the worldwide leader when it comes to TV sports coverage, but for nearly three months, it was lacking in leadership at the top ranks. That is now set to change, as The New York Times reports that James Pitaro, previously the chairman of consumer products and interactive at Disney, is stepping in as the company’s president. Pitaro fills a position that had been vacant since December, when John Skipper stepped down suddenly, citing a substance addiction.

Pitaro has been a major player in the media industry for almost two decades. He got his start in 2001 at Yahoo, where he quickly climbed the ranks and became vice president for media. In 2010, he moved to Disney, the parent company that owned ESPN, and managed a business unit that included gaming. Since 2015, he had been serving as co-chairman of Disney’s consumer products division.

“Jimmy forged his career at the intersection of technology, sports and media, and his vast experience and keen perspective will be invaluable in taking ESPN into the future,” said Robert Iger, chairman and chief executive of Disney

“Some of the best experiences of my professional career were working with the sports business,” Pitaro added. “I always knew in my heart I would return. This is a dream come true.”‘

ESPN has been relatively successful in recent years from a fiscal standpoint, but challenges still lie ahead. The New York Times reported that Disney made $55.1 billion in revenue and $14.8 billion in operating profit for the fiscal year ending Sept. 30. Media networks (primarily ESPN) had $23.5 billion revenue and $6.9 billion profit. To stay afloat, though, Pitaro will need to compete in an environment where cord-cutting is rampant and subscribers are dropping like flies.

Pitaro has pledged to try bold new things when ESPN’s situation calls for it. ESPN is already hard at work buying out assets from 21st Century Fox, including 22 regional sports networks. It’s also poised to launch ESPN Plus, a new sports streaming service, later this year.

“I come from the digital world, and spent most of my career building and investing in new media products,” Pitaro said.

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ESPN is Laying Off Another 150 Employees

 

ESPN's logo.

ESPN has long been an industry leader in cable TV sports programming, but it’s fallen on tough times lately. The network announced Wednesday that it was laying off 150 people, marking the second major series of cuts it’s had to make this calendar year.

“Today we are informing approximately 150 people at ESPN that their jobs are being eliminated,” said ESPN President John Skipper. “The majority of the jobs eliminated are in studio production, digital content, and technology, and they generally reflect decisions to do less in certain instances and redirect resources.”

This round of job cutbacks comes shortly after the network’s April announcement that it was laying off 150 people. That move included ousting a number of prominent on-air personalities, including former pro football players Trent Dilfer and Danny Kanell. This round of layoffs is directed more toward behind-the-scenes employees at ESPN. The company also let about 300 employees go back in October 2015.

These layoffs come amid a series of major business challenges for ESPN. First and foremost, the network has had to deal with declining revenue from subscribers as the number of people paying monthly fees for cable TV packages continues to decrease. This trend has led to tens of millions of dollars in lost revenue.

While job losses have been ongoing for over two years now, ESPN continues to look for ways to keep the ship afloat. For instance, the network is planning to open a new studio in New York in 2018, where it will host both a morning show and an afternoon opinion show as a way of bringing in new streams of revenue. Additionally, the network is looking to capitalize on the popularity of social media with a new Snapchat version of “SportsCenter.” This will offer sports fans a way to watch game highlights on their smartphones without having to watch traditional cable TV.

ESPN Facing Major Layoffs

A photo of an ESPN microphone.

Photo credit: Leonard Zhukovsky / Shutterstock

ESPN is the latest organization to be hit by the digital craze. The sports network is laying off 100 employees this week (mostly on-air talent) hitting every facet of the organization as ESPN is moving toward a mostly digitized medium.

Sources say the decision comes after an increasing amount of costs and decreasing number of cable subscribers have cut into its bottom line. For a network that has spent billions of dollars in deals with major sports teams and events, layoffs are no surprise to anyone. So who is getting hit? Well, some big names at the network.

Yesterday, Deadspin posted a number of tweets from ESPN anchors, writers, and reporters who were given the bad news, some of who worked at the network for decades.

NFL Reporter Ed Werder was one of the first to go.

“After 17 years reporting on #NFL, I’ve been informed that I’m being laid off by ESPN effective immediately. I have no plans to retire,” he tweeted.

“SportsCenter” Anchor Jay Crawford, Big Ten Reporter Brian Bennett, and MLB Writer Jayson Stark are some of the other talent who are now gone. College Basketball reporter C.L. Brown found out about his firing while on vacation.

ESPN President John Skipper noted how difficult this decision was, thanking the former employees for their “great work” and “many contributions,” yet made it clear that the layoffs had to be done.

“Dynamic change demands an increased focus on versatility and value,” Skipper stated, “and as a result, we have been engaged in the challenging process of determining the talent–anchors, analysts, reporters, writers, and those who handle play-by-play–necessary to meet those demands.”

Many of the people laid off were at the end of their contracts and unwilling to take a massive pay cut. The rest of which were bought out of their contracts.

A Sporting Chance for Cable?

TV

Are Americans finished with TV? Not TV shows, which are just a particular combination of film length and episodic storytelling, but rather the traditional delivery method for them. More is often considered better, and yet that doesn’t hold true with channel choices. The average American home has 189 channels to choose from, according to a 2014 Nielsen Advertising & Audiences Report, a full 60 more than in 2008. And yet with so many viewing options, a mere 17 are regularly used. Consumers identify what they like and then stick with it, rarely exploring the vast scope of additional viewing options remaining to them. This makes the cable bundle seem like an ever-more unsavory option. If, as a consumer, one knows what one prefers, likely has digital recording capability through a cable box or something similar, and can frequently find the same televised content online through websites like Hulu, YouTube, and the network’s own site, why continue paying for an almost 200-channel bundle of scheduled broadcasts?

A large part of the answer lies with the great American pastime and the channel that commands most of the access to it: sports, and ESPN. An independent study by mobile advertising technology company Marchex dug into the details of cable television subscription. They found that almost 40% of subscribers asked cable providers about paying for channels a la carte, with 20% of that group asking specifically about ESPN and another 4% asking about Fox Sports. Live streams of games are largely unavailable online, making ESPN close to a one-stop spot for live sports content. Many consumers begrudgingly retain their cable bundle subscription for the sports alone, but that privileged position may prove not-so-unassailable. Bundle subscriptions are dwindling overall, and Sony’s PlayStation Vue, a web TV service available through the titular video game console, launched without any Disney-owned content – including ESPN. This may lose Sony some customers it otherwise could’ve gotten, but it also demonstrates a willingness to offer TV service without the much-vaunted sports network.

Is Twitch The Next ESPN? Examining Amazon’s $1.1 Billion Purchase

On Monday August 25th, Amazon inked a $1.1 billion deal to acquire Twitch, the most popular website for watching popular video game streamers. In the following weeks, some have wondered about the potential of Twitch and whether it was worth the hefty price tag. Analysts appear to think Twitch will live up to the hype, some going as far as to draw comparisons between Twitch and popular sports network ESPN.

But what is Twitch and how does it really work? Twitch.tv is the world’s most popular website where visitors watch other users – called streamers – play popular video games. A typical Twitch video will include a real-time screen capture of a streamer’s screen while playing a game, as well as a video feed on the gamer’s face and a text window where streamers and viewers can communicate.

The site is monetized through subscriptions and advertising revenue. Users can purchase subscriptions to certain streams to watch their favorite gamers, which provide some revenue to streamers. Additionally, some streamers gain ad revenue from hosting their streams on Twitch—some make more than a living wage just from ad revenue.

There is a wide range of variety of the content on Twitch; some streamers are average gamers cracking jokes and enjoying their favorite video game; others are professional video gamers who rake in million dollar prizes at e-Sports competitions.

Twitch owes some of its success to the rise in popularity of e-Sports, the popular term for professional gaming. Some of Twitch’s most popular events involve live broadcasts of highly popular games like League of Legends and DOTA 2, bringing in views in number similar to that of traditional sporting events. These gamers also offer streams of their practices and invite spectators to ask questions about gaming techniques and strategy—think going to an open practice for a professional sports team, except more involved.

Twitch’s data might help many understand why Amazon was willing to open its wallet to purchase the website. During the month of July, there were more than 55 million unique visitors to the site. In October 2013, Twitch broadcasted a championship tournament for League of Legends and its viewership peaked at 8.5 million simultaneous viewers.

What’s even more impressive is that Twitch has achieved such greatness is such a small amount of time—Twitch launched in June 2011, a mere three years ago. However, it remains to be seen whether Twitch’s wild success will continue and whether it will make Amazon happy with its purchase in the long-term.

What do you think about this purchase? Would you watch an e-Sports competition?

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