ESPN Exec on Deals: ‘It’s Good Pressure’

Affils Chief David Preschlack Says Tech Advances Aid the Sports Programming Titan

By Linda Moss -- Multichannel News, 5/30/2011 12:01:00 AM

Even though it makes negotiating carriage deals a lot trickier, David Preschlack says that fast evolving technology is ESPN’s friend.

“For as far back as I can remember, we’ve always looked at what’s next,” Preschlack, who is executive vice president, affiliate sales and marketing, Disney & ESPN Networks Group, said. “It is really in our DNA.”

Hammering out contract renewals has become a much more complex process not only for gatekeepers from MSOs, satellite-TV providers and telcos, but for network affiliate-sales executives such as Preschlack, who handles ESPN’s empire of sports channels. They all must take advances in technology into account in their deals.

PLANNING AHEAD

Preschlack claims he doesn’t mind the stress of trying to craft contracts that will cover nascent technology that may be on the horizon, but isn’t even quite there yet.

“Is there pressure?” he asked. “Yeah, absolutely. But it’s good pressure. It forces us to continue to get better. We’ve been operating in that environment for quite some time.”

Sports behemoth ESPN was early in the game with its ESPN 360 broadband site, now called ESPN3.com; with HDTV and 3D networks; with its authenticated version of ESPN; and with its WatchESPN app for iPhones and iPads, which provides access to live streaming feeds from ESPN, ESPN2, ESPN3.com and ESPNU.

Those have all become potential deal points and bargaining chips — and possible areas of contention — in talks between programmers and distributors. It’s something that Preschlack will likely face soon.

He declined to comment on which affiliation deals are coming up for renewal for ESPN, which is owned by The Walt Disney Co. But on Disney’s first-quarter conference call, CEO Bob Iger said, “ESPN has a large number of distribution negotiations to engage in.”

Iger didn’t specify which deals he was referring to, but both Cox Communications and Charter Communications did major long-term deals with ESPN in 2004 that may expire in 2014.

In April, right before The Masters golf tournament, ESPN debuted its app for iPads and iPhones.

“The response has been pretty incredible,” Preschlack said. “These devices continue to gain popularity … We had well over 1 million downloads of WatchESPN since we launched back in April. People have embraced it right out of the gate, and the real value of this is portability.”

In terms of negot iat ions, ESPN has to “prioritize every day, because the landscape is always changing,” according to Preschlack.

DEALING IN 3D

ESPN 3D is definitely on that list. ESPN has struck agreements with Comcast, Time Warner Cable, DirecTV, Verizon Communications and AT&T for ESPN 3D, providing access to some 65 million homes. The channel, which launched last June the opening of the FIFA World Cup soccer tournament in South Africa, also has international distribution.

“I’m paying attention to the 3D marketplace like everybody else, in terms of some of the challenges, which I view as opportunities,” he said. “Betting against 3D is betting against technology. The user experience is just going to get better.

“I saw pure 3D on a smart phone from a colleague who runs a distribution marketplace in South Korea. Incredible. No glasses, by the way.”