Major sports leagues earn BILLIONS of dollars every year. That money comes directly from YOUR cable bill.

How Your Money Fuels The Dominance Of ESPN (2014 Edition)

Flickr Photo by John Frost

Last year, when I launched this web site, I wrote about how much of your cable bill ESPN collects and how the network spends it. Since that post, those numbers have changed. Subscriber fees have increased, and so have a few contracts. So let’s take another look at those numbers today.

First off, ESPN’s subscriber base has shrunk a bit, according to Nielsen. Both ESPN and ESPN2 had more than 100 million subscribers in July of 2011. That number has shrunk to 96,173,000 as of July of 2014. ESPN contends that drop has more to do with how Nielsen counts homes than any sort of actual drop, but for the sake of calculation, we’ll go with Nielsen’s numbers as they stand.

More importantly for ESPN, though, it’s subscriber fees have gone up. This report claimed that starting in July of 2013, ESPN’s flagship channel would receive $5.40 per month from every Time Warner Cable subscriber, with an annual escalator of 6.5%. That would put the current subscriber fee for ESPN at $5.75 per month. (SNL Kagan’s estimates are slightly higher, but given that most big cable companies get lowest price guarantees, we’ll go with the published report here.)

Based on those numbers and a bit more info from Nielsen and SNL Kagan, here’s how much ESPN likely will collect from America’s cable bills from July 2014 through June 2015:

Channel
Monthly Subscriber Fee
Number of Homes
Yearly Revenue (in millions)
ESPN
$5.75
96,173,000
$6,636
ESPN2
$0.74
96,173,000
$854
ESPNEWS
$0.23
74,413,000
$205
ESPNU
$0.21
74,579,000
$188
ESPN Classic
$0.21
29,739,000
$75
TOTAL
$7,958

Keep in mind that this is how much ESPN makes before the first ad is even sold. All of this money comes from cable and satellite TV bills. Networks charge the cable company a fee to carry a channel, and that fee is part of your TV bill. So if you’re one of the 96 million plus people who gets just ESPN and ESPN2 as part of your TV package, you’re contributing $77.88 per year to ESPN’s bottom line — whether you watch ESPN or not.

Oh, by the way, Forbes projects that ESPN will collect $3.9 billion in ad revenue in 2014.

From that massive pool of subscriber fees, ESPN pays for the broadcast rights to a wide variety of sports. Here’s a list of the major properties for which ESPN currently has the broadcast rights, how much ESPN is paying for those rights, and how much of your annual cable bill goes toward paying for those rights.

League
Annual Rights Fee
Individual Subscriber’s Share
National Football League
$1.9 billion
$19.76
Major League Baseball
$700 million
$7.28
National Basketball Association
$600 million
$6.24
Major League Soccer
$45 million*
$0.47
Wimbledon
$40 million
$0.42
U.S. Open (Tennis)
$23.3 million
$0.25
British Open (Golf)
$25 million
$0.26
College Football Playoff
$610 million
$6.35
NCAA Championships
$42 million
$0.44
ACC Sports
$240 million
$2.50
Big Ten Sports
$100 million
$1.04
Big 12 Sports
$110 million
$1.15
Pac-12 Sports
$103 million
$1.08
SEC Sports
$150 million
$1.56
American Athletic Sports
$18 million
$0.19
Mountain West Sports
$9 million
$0.07
Little League World Series
$7.5 million
$0.08
TOTAL
$4.721 billion
$49.15

* – This figure is part of the new MLS contract, which begins in 2015. ESPN will pay MLS $10 million for the 2014 season.

Less than 60% of ESPN’s subscriber fee income goes to pay for the broadcast rights to all the sports you see listed in that table. That list isn’t quite complete, either. ESPN also has U.S. broadcast rights to:

Terms of those deals aren’t available, however, and aside from the Masters, chances are ESPN doesn’t pay much at all for them. The last four leagues aren’t even shown any of ESPN’s TV networks; you can only watch them on ESPN3, the network’s online streaming service. The smaller American leagues likely offered ESPN limited streaming rights cheaply or even for free in exchange for the publicity.

Such is the power that the ESPN brand holds over American sports — power that comes directly from your cable bill. Little wonder that ESPN could afford to drop $178 million into its new SportsCenter studio. If you have ESPN in your cable package, you paid for that, too, though the state of Connecticut helped a bit.

You also paid for this rather horrific television moment, in which Stephen A. Smith insinuated that it’s somehow a woman’s responsibility not to get beaten by a man.

One channel not included on this list? ESPN’s new SEC Network, which launches in August. How much you’ll pay for that depends on where you live. According to this report, pay TV customers living in states within SEC territory will pay $1.40/month for SEC Network, while customers outside of SEC territory will chip in $0.25/month. So if you live in the Southeast and get all four ESPN channels plus SEC Network, almost $100 of your annual cable bill goes directly to ESPN.

Again, whether you actually watch any ESPN channels or not does not matter here. If you subscribe to a cable or satellite TV package that includes ESPN, then ESPN gets your money, and because of that, your money gets funneled into the NFL, MLB, the NBA, and the collegiate cartel that refuses to offer fair market value to young athletes. What’s more, the amount you give to ESPN will increase by 6.5% every year. That number will be well over $8 within just four years.

If you watch a lot of sports, you might think that $100/year for ESPN is bargain — until you think about the other 196 channels you have to pay for just to get ESPN. If you don’t watch sports at all, and you would prefer not to have that much of your money funding something you don’t care about, perhaps it’s time for you to consider cutting the cord.

***

It’s not just ESPN funneling money from your cable bill into major pro and college sports. Click here to use our front-page app and see which leagues benefit from the channels on your pay TV service.

4 Responses to How Your Money Fuels The Dominance Of ESPN (2014 Edition)

  1. More and more people are watching netflix, hulu, etc. Cable companies will eventually have to separate these things and start charging a la carte. As a sports fan I am fine with this because I am already paying for all of these channels. I would love to cancel lifetime, oprah’s network, e!, and all the other shit that is on tv.

    • Funny you should mention that: Lifetime is part of A+E Networks, which is half-owned by Disney, which owns ESPN.

      This is why Disney loves the cable bundle. If you want your ESPN, you’ll have to pay for all of Disney’s other channels to get it.

      • Didn’t even know that Dave. Great point that makes it even more evident this needs to stop. I hope the open market will someday force them to go a la carte.

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