ESPN’s cost-cutting measures that have become a significant source of strife at the company in recent months are likely about to claim another high-profile victim: Keith Olbermann.
Two years after President John Skipper brought Keith Olbermann back to ESPN, multiple sources within the company say that contract negotiations with Olbermann recently broke down, and according to a person with knowledge of those negotiations, there’s “a 90% chance” he won’t return to the network this Fall.
[UPDATE: July 8th: Keith Olbermann and ESPN could not negotiate a new contract, and he will not return to the network.]
But it might not just about money. It seems ESPN is unhappy with Olbermann’s “commentary” on his weekday TV show, in which he has regularly gone after power players in sports, including NFL commissioner Roger Goodell.
The money issues at ESPN are undeniable. Sources say ESPN President John Skipper was recently told by Disney to slash about $100 million from the 2016 budget, and an estimated $250 million from the 2017 budget.
Money was the driving force behind the pulling of ESPN radio show Mike & Mike from its highly-publicized move to New York City. And, the studio ESPN would have used for that show is the one that currently hosts the Olbermann show.
During his contract negotiations, ESPN tried to sell Olbermann on a move to Bristol or Los Angeles – another cost-cutting attempt to save money on expensive midtown Manhattan real estate – in addition to asking him to dial down the commentary.
[UPDATE, July 1st: After this post, ESPN PR said, “Keith Olbermann has never been told any topic is off limits for his commentary, nor has continuation of it been part of any conversation about his future at the company.“]
Why all the money fears?
One increasing fear among suits at ESPN: Cord Cutters. You may or may not know anybody who has cut the cord on TV, but millennials are eschewing expensive cable TV bills and streaming everything online.
Media Life Magazine recently wrote about Cord Cutting, and, citing Digitalsmiths, claimed more and more people are ditching their TVs.
It was unclear how many people Digitalsmiths polled to get their numbers, but privately, this phenomenon has ESPN freaked out. Live sports TV rights are only escalating, but on the other side, ESPN is losing cable subscriptions. It’s only a drip now, but in a decade, it could be significant.
Look at this chart from the Wall Street Journal in 2014 showing how much ESPN brings in per subscription:
Two summers after Skipper’s spending spree to bring in Jason Whitlock, Keith Olbermann and Nate Silver, one is out of the job he was hired for (Whitlock), another appears on his way out the door (Olbermann) and if these things come in threes, how safe is Nate Silver?
[Photo via Getty]