When Disney starts to lose eyeballs, it attracts some attention. And that’s exactly what’s happening.
Tuna Amobi, a top media analyst, said that pay television is currently at a tipping point, and the chance is especially noticeable at Disney. Consumers are shifting to streaming video, and the numbers are “sobering” for the company that just laid off scores of top talent at ESPN.
“Obviously, ESPN is exposed,” he said. “We’re getting a lot more cord cutters and cord nevers.”
As the company continue to lose subscribers by the thousands, quarterly numbers are expected to be announced this week. And while Disney will certainly make a profit, it’s not going to be as much as expected.
Wall Street is paying particularly close attention to Disney’s media networks section, who had an operating income decline of 4 percent from the previous year. And as evidenced by ESPN’s recently layoffs, it’s clear that changes are afoot.
Disney CEO and Chairman Bob Iger feels like the reaction to first quarter subscriber losses are overblown. Speaking to CNBC in February, he said “I think there’s way too much pessimism about ESPN because ESPN is still in demand from three constituents you want to be in demand the most from,” meaning distributors, consumers and advertisers.
But Amobi disagrees, saying the company absolutely has to do something about the lost subscribers. What though, he’s not sure. “That’s the biggest challenge,” he said. “I think they’re going to try to mitigate.”
Whether ESPN’s losses really matter or not, what does matter is that people are moving away from traditional pay television. Sports Illustrated just announced their own streaming video platform, and if ESPN wants to stay competitive, they’re going to have to make changes of their own.
Latest posts by Artie Beaty (see all)
- YouTube TV Available in 31 More Cities - August 17, 2017
- McGregor-Mayweather Fight Will Be Available On Sling TV - August 16, 2017
- Sling TV Subscribers Can Now Watch TV On Google Chrome - August 15, 2017