Yesterday, I went on at length here and on social media about how cord-cutting is the reason ESPN decided to lay off about 100 employees.
I still very much believe this. I believe all of the other economic reasons for the decision — overpaying for rights fees for TV deals, lower ratings, etc. — are absolutely a factor. But without cord cutting, without that 24 percent of households either canceling cable or never having it to start, with the adjacent loss of all those carriage fees, the rights fees and ratings wouldn’t be the issues they are.
The lower ratings and rights fees are factors. And at some point, as my podcast co-host Galen Clavio said to me last night in a text, “We are basically arguing over whether the flood or the wind destroyed the house at this point.”
But there’s a larger issue here. Let’s step back and see the whole board and see what the problem is in blaming cord cutting.
To blame cord cutting is to essentially say “We had no choice in this.” It’s to essentially say “Our future as a company is wholly dependent upon external factors that we had and have no control over.” It’s essentially to say “It’s not our fault we’re doing this. We’re just responding to reality.”
It’s everything every newspaper industry executive has said when downsizing their paper’s staff, when cutting back publications without dedicating proper resources to online news. It’s everyone saying that newspapers had no way of knowing how damaging the internet would be to their core business model. It’s shirking all responsibility and basically saying everything was fine until that meddling internet came along and ruined things.
And that’s, at best, incomplete.
Yes, cord cutting is the reason behind these cuts. But to blame that and that alone eliminates the need for the necessary self reflection both inside the company and the industry as a whole. Maybe rights fees are too expensive. Maybe ESPN and Disney should have seen the trend of cord cutting coming — it’s not like it’s a brand new thing that just happened — and found new ways to make revenue rather than just sitting back and assuming sports fans would keep their cable because of live sports, the way newspapers thought everyone would keep buying the print edition 15 years ago.
Maybe it’s time media organizations, large and small, realize we’re living in a time of abundance rather than scarcity, and that what has worked for so many years doesn’t work anymore.
Sometimes, external factors are the reasons you have to make decisions. But they shouldn’t be the end. They should be the beginning of a larger, honest discussion about what’s next.