ESPN: What the heck just happened … and who’s to blame?

Last week, ESPN announced the layoffs of some 100 staffers, most of them on-air talent. This comes after layoffs of ~300 other personnel in 2015, but since those were behind-the-scenes employees, the news didn’t seem as momentous.

There are several factors coming together that make life particularly difficult for the sports network. One big problem is the commitment ESPN has made to pay top-dollar for the right to air professional sports events, particularly NFL and NBA games.

These financial commitments are set in stone and are made well into the future, which means that ESPN is committed to high long-term fixed costs (broadcast rights) in exchange for what’s turning out to be declining variable revenues (viewer subscription fees and advertising).

This isn’t a very good financial model at all.

Which brings us to the second big factor: declining subscribers.

Since 2011, the network has lost ~15 million subscribers. So far in 2017, the network has experienced an average loss of ~10,000 people per day.

The financial impact of these losses is significant. All of those lost subscribers amounts to more than $1.3 billion per year in money that’s no longer going on ESPN’s books.

Sports journalist Clay Travis predicts that if the current trajectory of subscriber losses continues, ESPN will begin losing money in 2021. (And that’s assuming the subscriber base losses don’t accelerate, an assumption that might be a little too rosy.)

The fundamental question is why so many people are no longer subscribing to ESPN. The predictable answer is because services like Hulu, Netflix and Amazon, with their on-demand services, are squeezing cable/satellite TV and its subscription business model.

One way Disney (ESPN’s parent company) has attempted to maximize viewer subscription revenues over the years has been by bundling the network with other, less lucrative Disney media properties like the History Channel, Vice, Disney Junior and the Lifetime Movie Network. In the Disney constellation of channels, ESPN has been the acknowledged “driver” of subscription revenues all along, with die-hard sports fans being willing to subsidize the other Disney channels – often never watched by these subscribers – as the price of access.

But something else is happening now:  ESPN itself has begun to lose viewers as well.

According to television industry publication Broadcasting & Cable, ESPN’s viewership rating has declined ~7% so far this year.  ESPN2’s rating is down even further – an eye-popping ~34%.

Percentages like those aren’t driven by “sidebar” incidental factors. Instead, they cut to the core of the programming and the content that’s being offered.

If there’s one programming factor that’s tracked nearly on point with ESPN’s viewership declines, it’s been the explosion in “sports-talk” programming versus actual “sports game” programming at the network. As Townhall opinion journalist Sean Davis has written:

“If you talk to sports fans and to people who have watched ESPN religiously for most of their lives, they’ll tell you that the problem is the lack of sports and a surplus of shows featuring people screaming at each other. The near-universal sentiment … is that the content provider sidelined actual sports in favor of carnival barkers.”

Davis points out the flaw in ESPN’s shift in colorful terms:

“ESPN went from the worldwide leader in sports to yet another expensive network of dumb people yelling dumb things at other dumb people, all the while forgetting that the most popular entertainment of people yelling about sports stuff for several hours a day – sports talk radio – is free.”

There’s an additional factor in the mix that’s a likely culprit in ESPN’s tribulations – the mixing of sports and politics. That programming decision has turned out to be a great big lightning rod for the network – with more downside than upside consequences.

The question is, why did ESPN even go in that direction?

Most likely, ESPN execs saw the tough numbers on higher costs, subscriber losses and lower ratings, and decided that it needed a larger content pie to attract more consumers.

The reasoning goes, if some people like sports and others like politics, why not combine the two to attract a larger audience, thereby changing the trajectory of the figures?

But that reasoning flies in the face of how people consume political news. In the era of Obama and now Trump, political diehards gravitate to outlets that reinforce their own worldviews:  conservatives want news from conservatives; liberals want news from liberals.

MSNBC and the Fox News Channel have figured this out big-time.

But if you’re starting with a cross-partisan mass media audience for sports, as the original ESPN audience most certainly was, trying to combine that with politics means running the risk of losing one-half of your audience.

That’s what’s been happening with ESPN. Intertwining sports with coverage about bathrooms in North Carolina, transgender sports stars, gun control laws and proper national anthem etiquette only gets your numbers going in one direction (down).

The question for ESPN is how it plans to recalibrate and refocus its programming to truly defend its position as the worldwide leader in sports broadcasting. However it decides to position itself in terms of the delivery of its content – television, online, subscription, pay-per-view or other methods – it should refocus on covering live sports events.

Not sports talk … not debate … not politics or sociology, but the sports themselves.

At one time, not so long ago, sports were a safe refuge from politics and the news. ESPN would do itself – and its viewers – a favor if it sought to recapture that spirit.

Is the Phenomenon of “Fake News” Overhyped?

fnIn the wake of recent election campaigns and referenda in places like the United States, the United Kingdom, France, Austria and the Philippines, it seems that everyone’s talking about “fake news” these days.

People all across the political and socio-economic spectrum are questioning whether the publishing and sharing of “faux” news items is having a deleterious impact on public opinion and actually changing the outcome of consequential events.

The exact definition of the term is difficult to discern, as some people are inclined to level the “fake news” charge against anyone with whom they disagree.

Beyond this, I’ve noticed that some people assign nefarious motives – political or otherwise – to the dissemination of all such news stories.  Often the motive is different, however, as over-hyped headlines – many of them having nothing to do with politics or public policy but instead focusing on celebrities or “freak” news events – serve as catnip-like clickbait for viewers who can’t resist their curiosity to find out more.

From the news consumer’s perspective, the vast majority of people think they can spot “fake” news stories when they encounter them. A recent Pew survey found that ~40% of respondents felt “very confident” knowing whether a news story is authentic, and another ~45% felt “somewhat confident” of that fact.

But how accurate are those perceptions really? A recent survey from BuzzFeed and Ipsos Public Affairs found that people who use Facebook as their primary source of news believed fake news headlines more than eight out of ten times.

That’s hardly reassuring.

And to underscore how many people are using Facebook versus more traditional news outlets as a “major” source for their news, this BuzzFeed chart showing the Top 15 information sources says it all:

  • CNN: ~27% of respondents use as a “major source” of news
  • Fox News: ~27%
  • Facebook: ~23%
  • New York Times: ~18%
  • Google News: ~17%
  • Yahoo News: ~16%
  • Washington Post: ~12%
  • Huffington Post: ~11%
  • Twitter: ~10%
  • BuzzFeed News: ~8%
  • Business Insider: ~7%
  • Snapchat: ~6%
  • Drudge Report: ~5%
  • Vice: ~5%
  • Vox: ~4%

Facebook’s algorithm change in 2016 to emphasize friends’ posts over publishers’ has turned that social platform into a pretty big hotbed of fake news activity, as people can’t resist sharing even the most outlandish stories to their network of friends.

Never mind Facebook’s recent steps to change the dynamics by sponsoring fact-checking initiatives and banning fraudulent websites from its ad network; by the accounts I’ve read, it hasn’t done all that much to curb the orgy of misinformation.

Automated ad buying isn’t helping at all either, as it’s enabling the fake news “ecosystem” big-time. As Digiday senior editor Lucia Moses explains it:

“One popular method … is tapping the competitive market for native ad widgets. Taboola, Revcontent, Adblade and Content.ad are prominently displayed on sites identified with fake news, while there are a few retargeted and programmatic ads sprinkled in. Publishers install these native ad widgets with a simple snippet of code — typically after an approval process — and when readers click on paid links in the widget, the host publisher makes money.  The ads are made to appear like related-content suggestions and often promote sensational headlines and direct-marketing offers.”

So attempting to solve the “fake news” problem is a lot more complicated than some people might realize – and it certainly isn’t going to improve because of any sort of “political” change of heart. Forrester market analyst Susan Bidel sums it up thus:

“While steps taken by … entities to curb fake news are admirable, as long as fake news generators can make money from their efforts, the problem won’t go away.”

So there we are. Bottom-line, fake news is going to be with us for the duration – whether people like it or not.

What about you? Do you think you can spot every fake news story?  Or do you think at least of few of them come in below radar?

For many people, what’s “breaking news” isn’t breaking on traditional news media outlets.

First it was Jon Stewart. Now it’s social media. 

(AP)
(AP)

If you suspect that Americans are increasingly getting their news from someplace other than the standard TV/cable, print and online news outlets, you’re right on the money.

In fact, research conducted by the Pew Center in association with the Knight Foundation during 2015 reveals that the share of people for whom Facebook and Twitter serve as a source of news is continuing to rise.

More specifically, nearly two thirds of the 2,000+ Americans age 18 and older surveyed by Pew (~63%) reported that they’re getting news reporting from Facebook.

A similar percentage reported receiving news from Twitter as well.

That compares with ~52% reporting that they received news from Twitter back in 2013 … and ~47% from Facebook.

Although both of these social networks now have the same portion of people getting news from these two sources, the Pew research discovered some nuanced differences as to their strengths.

smnA far bigger portion of people follow “breaking news” on Twitter compared to Facebook (~59% versus ~31%), which underscores Twitter’s strength in providing immediate “as-it-happens” coverage and commentary on live events.

Seeing such behaviors, it shouldn’t come as any surprise that both social networks have been implementing more initiatives that strengthen their positions as news sources even more:

  • Facebook has launched Instant Articles, a functionality that allows media companies to publish stories directly to the Facebook platform instead of linking to outside websites.
  • Facebook has also introduced a new Trending sidebar that allows users to filter news by major topic categories such as sports, entertainment, politics, technology and science.
  • Twitter has introduced live events to its roster, thanks to its purchase of the live video-streaming app Periscope.
  • A related Twitter initiative, dubbed Moments (aka: Project Lightning), allows anyone – even a person without a Twitter account – to view ongoing feeds of tweets, images and videos pertaining to live events.

According to Pew, news exposure is on social media roughly equal among all demographic factors including gender, ethnicity and income. The one exception, of course, is age.

All of these developments underscore the fact that the “traditional” TV, print and online outlets are no longer dominant when it comes to news consumption. And it’s highly unlikely that the trend will ever be reversed, either.

Who Trusts the Media?

Americans give a big thumbs-down when it comes to having “trust and confidence” in mass media – TV, radio and newspapers.

MediaAre Americans’ attitudes about the press becoming more negative over time? If the latest survey figures on media trust are any guide, the answer is a pretty stark “yes.”

According to a recent Gallup field survey of ~1,025 American citizens aged 18 or over, trust and confidence in the mass media in the United States has reached a new low.

Today, just ~40% of respondents report that they have “a great deal” or “a fair amount” of confidence that newspapers, TV and radio report the news “fully, accurately and fairly.”

What’s more, trust levels have been on a downward trajectory ever since the late 1990s, when Gallup began surveying Americans’ attitudes on an annual basis.

Here’s what the trend looks like in the “off-election” years:

  • 1999: ~55% have “a great deal” or “a fair amount” of trust in mass media (TV/radio/newspapers)
  • 2003: ~54%
  • 2005: ~50%
  • 2007: ~47%
  • 2009: ~46%
  • 2011: ~44%
  • 2013: ~44%
  • 2015: ~40%

Moreover, the notion that young people might be more inclined to trust the media isn’t borne out in the Gallup survey results. The trust of Americans age 18-49 has dropped from 53% in 2005 to only 36% now.

Contrast this with older Americans (age 50 or older): 45% of them reported that they had trust and confidence in mass media in 2005, and today that trust level is … still 45%:

Media trust by age

Giving further credence to the oft-stated claim that American mass media are slanted towards one political party, ~55% of self-identified Democrats express trust in the media, compared to just 32% of Republicans and 33% of independents.

Gallup can’t resist editorializing a bit about its most recent media trust figures:

“Americans’ trust level in the media has drifted downward over the past decade, but some of the loss in trust may have been self-inflicted, as major venerable news organizations have been caught making serious mistakes in the past several years.”

Additional information on the Gallup survey can be accessed here.

Harris Poll: What Americans say they want in news coverage.

When it comes to the news, Americans say they’re tired of so much attention on celebrity gossip and scandal stories … but are they really?

news mediaExperience has shown that healthy foods on the menu at fast food establishments test well in consumer attitudinal surveys — only to bomb big time when actually introduced.

It seems as though many people answer the way they think they’re “supposed” to respond, even though they’ll never actually opt for the apple slices in lieu of the order of fries.

I wonder if the same dynamics are at work in a recent Harris Poll, which queried ~2,500 Americans age 18 or over about their preferences for news topics.  The online survey was conducted in August 2014, with the results released this past week.

For starters, three-fourths of the respondents felt that celebrity gossip and scandal stories receive too much coverage.

Indeed, many believe that entertainment news in general receives too much attention in the news:

  • Celebrity gossip and scandal stories: ~76% claim too much attention is paid in the news
  • Entertainment news in general: ~49%
  • Professional spectator sports: ~44%
  • Politics and elections: ~33%

And which topics do people feel aren’t covered sufficiently in the news? It’s everything that’s “good for you”:

  • Education topics: ~47% believe too little attention is paid in the news
  • Local/national humanitarian issues: ~47%
  • Science topics: ~45%
  • Government corruption and scandals: ~44%
  • Corporate corruption and white collar crime: ~42%
  • Global humanitarian issues: ~33%
  • Health topics: ~30%

I suspect that the “actual reality” is different from how the survey participants responded. If news organizations weren’t seeing keen interest generated by their celebrity, entertainment and sports stories, they would stop producing them.  Simple as that.

Harris Poll logoYou can view more findings from the Harris survey, including data tabulations, here. Among the interesting findings is the degree of trust people have for various different news media:  network TV news, local TV news, local newspapers, national newspapers, online news sources.

Hint: trust levels are nearly where they should be …

What are your thoughts about news topics? Which ones are getting proper coverage versus too much?  Please share your observations with other readers here.

Pew Monitors Changing Views about the News Media

News media organizations losing luster with Americans
News organizations are losing their luster with Americans, according to the Pew Research Center.
The Pew Research Center for People and the Press has been surveying American adults since 1985 about their views of the news media.

A new comprehensive report, incorporating results up to and including field surveys conducted in 2011, finds that negative opinions about the performance of news media are higher than ever on nine of twelve key measures studied.

Here are some sobering stats from this year’s consumer pulse:

 ~66% of respondents believe that news stories are often inaccurate
 ~77% think that news organizations tend to favor one side over another politically
 ~80% believe that news organizations are influenced by powerful people and organizations

The findings on the accuracy of news reporting are particularly striking. As few as four years ago, ~39% of respondents felt that news organizations “mostly get the facts straight” while ~53% believed that the news stories were “often inaccurate.”

Today’s those numbers look more depressing: Only ~25% say that news organizations tend to get the facts straight, while ~66% contend that news stories are often inaccurate.

[Of course, when it comes to respondents’ own preferred news outlets, the figures don’t look nearly as dismal. In fact, nearly two thirds of the respondents believe their preferred news sources get the facts mostly correct.]

Who does the public see as the leading “news media” these days? Cable TV organizations clearly lead in the rankings, with network news now pushed down the list:

 ~43% named CNN as a “news organization”
 ~39% named Fox News
 ~18% named NBC News
 ~16% named ABC News
 ~12% named CBS News
 ~12% named MSNBC
 ~10% named local TV news

It’s been a long fall for CBS News in particular, which was once considered the ace news broadcast network in the United States.

In general terms, who do people trust most as a source of news? The answer may be surprising to some: Top-ranked are local news organizations:

 Local news organizations: ~69% of people have “a lot” or “some” trust
 National news organizations: ~59%
 State government: ~51%
 Presidential administration: ~50%
 Federal government agencies: ~44%
 Business corporations: ~41%
 U.S. Congress: ~37%
 Political candidates: ~29%

And as far as where people go for news, TV and the Internet continue to be the top two sources. But consider how those rankings have changed. Five years ago, TV was cited by 74% of survey respondents as one of the two top news sources … but that figure has now declined to ~66%.

As for the Internet, it’s grown from ~24% saying it’s a top-two source for news in 2007, to ~43% today.

Meanwhile, newspapers are staying on the decline … so that today, only ~31% of respondents place them among the two top sources of news. Newspapers continue to have their partisans among the over-65 age segment, but younger than this, it’s just a lost cause.

But there’s one bright spot for newspapers: They continue to be recognized as a leading source of local news. This helps explain why many small-town and local papers have been better able to navigate the choppy waters of newspaper publishing better than their big-city counterparts.

There are many more interesting findings outlined in the latest Pew news organization survey. For more details, click here.

Twitter’s World: Click … or Clique?

Twitter traffic:  dominateed by a tiny fraction of users.
Half of all tweets are generated by fewer than one-half of one percent of Twitter accounts.
What’s happening these days with Twitter? The micro-blogging service continues to light up the newswires every time there’s a civil disturbance in a foreign land, because of how easily and effectively it facilitates planning and interaction among the dissidents.

But what we’re also finding out is that Twitter is overwhelmingly dominated by just a small fraction of its users.

In fact, Cornell University and Yahoo recently published results of an evaluation of ~260 million tweets during 2009 and 2010, which found that ~50% of the tweets were generated by just 20,000 Twitter users.

That is right: Fewer than one half of one percent of Twitter’s user base accounts for fully half of all tweet activity.

Just who makes up this “rarified realm” of elite users? It turns out that they fall into four major groups:

 Media properties (e.g., CNN, New York Times)
 Celebrities (e.g., Ashton Kutcher … Lady Gaga)
 Business organizations (e.g., Starbucks)
 Blogs

Even more interestingly, these “elite” users aren’t interfacing with the rest of us “regular Twitter folk” as much as they are simply following each other: Celebs follow celebs … media companies follow other media companies … bloggers follow other blogs.

The Cornell/Yahoo research report, titled Who Says What to Whom on Twitter, can be found here.

But one wonders if the report should be retitled Much Ado About Nothing?