Unbundling: Is the cord-cutting trend overrated?
Posted July 22, 2016
Dean Jordan is the Managing Executive of Global Sports Media Rights at Wasserman Media Group. In more simple terms, he's ACC commissioner John Swofford's television consultant. Jordan's opinions carry a ton of weight in Greensboro and he was described as "the best in the business" by Swofford during Thursday's ACC Network announcement.
Swofford initially asked Jordan in 2009 to evaluate the ACC's ability to start a channel.
"I was watching the Big Ten start up their network and it wasn't pretty, it turned out great, but it wasn't pretty," Swofford explained to 99.9FM The Fan. "So even at that time we weren't really sold on whether that was the way to go. But obviously we became sold and here we are today."
Jordan's recommendations helped guide the ACC throughout the process and will continue to be part of the conference braintrust leading up to the inevitable launch of the ACC Network. Following the official announcement in Charlotte, I engaged with Jordan on the topic of cord-cutting and where the industry is headed.
Why didn't ESPN and the ACC go with an over-the-top internet option?
“Because there isn’t an OTT model that’s proven successful yet. Even ones that are ‘successful,’ are not what they thought they would be and those have been sports. The closest OTT thing that’s been a success that has sports as part of it has been Sling TV with ESPN. You have that, but I have yet to have known a major sporting event that’s been streamed where you haven’t seen some complaints about buffering."
Disney CEO Bob Iger has openly talked about ESPN eventually going standalone, is there an eye towards OTT?
“What we have discussed is the fact that we’re flexible. Our structure is flexible and it can adapt to whatever ESPN wants to adapt to. We’re not afraid to be a Guinea pig if at some point in time they want to do that."
2019 is long time away when you consider technology changes at a rapid pace and we’re already seeing lines drawn between cable operators and networks, so how do you see that playing out in terms of potential difficulty getting full distribution for the ACC Network?
“That’s why we have ESPN as a partner. ESPN has been successful with every channel launch they’ve had. Their distribution people certainly know what they’re doing and they’ve got a plan. We have the utmost confidence in them."
Do you think the cord-cutting trend is overblown?
“Yes, because I think it’s more ‘cord-nevers’ than it is cord-cutters. I’ve seen research where cord-nevers, and perhaps it’s cord-cutters, usually tend to be Millennials, but those people still need to have a cord into their home to get broadband. So as long as the cable companies are the biggest providers of the cord they’re always going to be able to manipulate that. Plus there’s a lot of research that people who are cord-nevers, that when they get married, there’s a spike in cable subscriptions. When they buy a new house, it spikes up a little more. When they have a baby, it goes up."
However, more and more people are getting comfortable with streaming options as digital devices like Apple TV get into more households. So if you’re going broadband, how does a network like ESPN get money out of it compared to the old model where they get around $6 per subscriber?
“I can’t speak for ESPN on that, but given where we are and I don’t want any chance where it gets commingled with what ESPN should do or get into this, I’m going to have to beg off of that one. However, I would say to look at the Sling TV model. That’s worked well for ESPN. The thing in the discussions that we’ve had over time is that they are going to be very aggressive in adapting to and utilizing technology. Our structure with them is designed so that where every they go, we can go. Believe me, they’re very good at running businesses."