These are headlines you never want to see in any industry. Today, out of nowhere, ESPN laid off hundreds of employees. The troublesome signs first appeared on the Twitter page of bestselling author and ESPN authority Jim Miller.
ESPN workforce hasn't faced reductions in its numbers for at least several years. That may no longer be the case. Fasten seat belts.— James Andrew Miller (@ESPNBook) May 21, 2013
The details are grisly. Miller also pegged the number of layoffs between 300 and 400 employees. Deadspin's John Koblin was told a similar number by sources. Eventually, ESPN would confirm the news in a public statement on the matter that "tried" to put a "positive" spin on the news:
“We are implementing changes across the company to enhance our continued growth while smartly managing costs. While difficult, we are confident that it will make us more competitive, innovative and productive.”
ESPN employees almost 4,000 people alone on its Bristol campus and many others around the globe, but layoffs in the hundreds are staggering for any company. Keep in mind that earlier this month ESPN also shut down its ESPN America international channel after selling its UK channel to BT Sport. The most troubling element is several hundred faithful employees losing their job in spite of ESPN's global success and insane net worth. This is a company worth tens of billions of dollars, and yet hundreds of its employees will now have to find work elsewhere.
One of the anonymous workers laid off today tells Deadspin the motivation behind these severe decisions stem from ESPN not hitting their profit margin and ESPN was forced by Disney to make cuts.... the same Disney whose stock recently reached an all-time high this month. They aren't the only Disney property to be forced into making cuts either. Wrap your mind around that reality.
It's no secret that sports rights fees are exploding. We've wondered for quite some time whether or not the sports rights bubble was close to bursting with billions of dollars being splashed around for television rights. Perhaps this isn't the bursting of that bubble, but a sign of its stretching and tightening. Consider that in the past two years ESPN has paid these prices for live sports rights...
And that's not to mention the SEC, NBA, NASCAR, numerous college sports, soccer, etc. that ESPN airs. Are these layoffs a sacrifice to be made at the expense of increasingly astronomical live sports rights and a cutthroat command from the higher-ups at Disney to maintain and increase profit? You feel for the folks in Bristol and elsewhere on a day like this, when billion dollar entities decide there's no room left at the table for them. There are countless hard-working, dedicated individuals at ESPN whose names will never see the light of day that deserve better.
I do think that ESPN and the entertainment industry in general are facing huge headwinds, especially given the overall economy. In addition to the sports rights bubble mentioned, the cable/satellite industry is moving slowly, but inexorably to a la carte model. It's going to be tough for the average guy to justify spending $30/month on Skip Bayless, Stephen A. Smith, & yet another lousy Alabama, Duke, Lakers, or Yankees game. ESPN, and these sports channel in general, may never see their money back on some of these long-term deals.
So corporations always talk about the Triple Bottom Line, and their commitment to their 3 main stakeholders. Customers, Staff and Shareholders.
But here again is mroe proof that when push comes to shove, it is always shareholders who get their way employees and customers be damned.
Someday ESPN will run live block programming with full natural sound. No announcers, graphics, or production. And, people will still watch in the tens of millions.
Doesn't surprise me. ESPN over the last few years has become so uninteresting for a few reasons to me. I think they went in over their heads with spendings when you look at the numbers for one, but I'm sure ratings are down as well. When these morons take a story like Teo's invisible gf and cram it down peoples throats for two weeks, guess what? People are going to change the channel! They have become a huge media outlet for all sports which is great, but I hate a lot of the broadcasting. It gets ridiculous after awhile, and I feel bad for the people that lost their job, I hope those people get on their feet quick! It's a shame, I hope you corporate fucks get your just due soon!
i don't feel for them one bit. they work for a shitty company producing a shitty product, and through association they're to blame for it.
if you're in the sports entertainment business, and you're not working for a company not named ESPN, you're a part of the problem and not a part of the solution.
hopefully, and given the track record of ESPN making personnel decisions this is a likelihood, ESPN kept the idiots and fired the ones who are competent so that maybe - just maybe - they can hitch up with Fox Sports 1 and finally provide us with an alternative to the drivel that spews forth from bristol.
I do feel sorry for those people laid off. I guess you can only have too many people who can do anything about the NBA or make a dunk a Top 10 play. Maybe those who got laid off said something about those dunks or said there should be a hockey highlight or that there was more to sports than Tiger, Kobe and LeBron.
I'm no economist, but let me see if I understand this:
Lower Profits = "Reducing" (firing) employees;
Fewer jobs = Less spending in the economy;
Less spending = Lower sales;
Lower sales = Lower Profits;
Hopefully Skip Bayless can go spend some time in the unemployment line with his boyfriend Tim Tebow!!
Wow, that's shitty...everyone trying to do more with less...most if not all corporations are just heartless, shameless, money grubbing whores
@JoeTurner You are correct! You're no economist..
@twofingersneak A pretty drastic oversimplification, I think. It's a safe bet that the guy who decided to put Stephen A on TV for six hours the other day didn't get fired, but the guy whose job it is to get coffee for him may have. The average grunt on the ESPN front lines bears now more responsible for the whole operation than the average frontline soldier does for the political conduct of a war.
Thanks for agreeing with me! But I do know that we are in an economy that is overwhelmingly driven by consumer consumption. Reduced demand from lower household income is bad for the country in the long-term. The wealthy can only consume so many burritos!
@twofingersneak that should be "bears no more responsibility for the whole operation." Too much caffeine to type well, apparently.