ESPN’s Latest Land Grab: Sports Giant Invades the Mobile Realm

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Salil Mehta has a job any techie sports fan could love: executive vice president of ESPN Enterprises. The unit handles the sports network’s new media, consumer products and mobile divisions. Its top prospect, Mobile ESPN, will debut on Super Bowl Sunday, Feb. 5, and provide sports fans an unparalleled cell-phone experience. Mehta recently spoke with Multichannel News technology editor Matt Stump about how ESPN is branching out into new mediums. An edited transcript follows:

MCN: The original content ESPN produces -- like SportsCenter, ESPN Original Entertainment productions, commentaries and analyses -- don’t present huge rights issues for the new platforms. Professional-sports-league rights are another matter. What is the extent of rights you have for highlights and full games from the professional-sports leagues for all the new platforms out there?

Mehta: It is truly evolving. As you would suspect, many of these deals that govern this material were written before, for example, Mobile ESPN was even contemplated.

To take a step back, we see our purpose in any new rights negotiation or any recent rights negotiations [as ensuring] that when we get content, we get content for all platforms. It is a critical element of our strategy. Everything at ESPN starts with our mission, which is to serve sports fans wherever sports are watched, listened to, discussed, debated, read about or played.

That means you are going to be on any platform that the consumer wants to be on. It means you are not going to focus on cannibalization. In the past, when we launched ESPN2, we didn’t worry about what it would do to the ratings of ESPN.

As we acquire new rights, going forward, we want to have the capability to deliver that particular sport with ESPN’s unique analysis, perspective and attitude and give it to fans on whatever platform they are on.

Today, the rights are a patchwork. For instance, we have the ability to take Monday Night Football and air it on our phone, the complete game. We have that right. How we actually go about doing that is an open question.

MCN: Through Mobile ESPN and Mobile Publishing, ESPN is supplying content to Verzion’s VCast service and MobiTV. What content is available, and what is the usage so far?

Salil Mehta: It’s very similar content. It’s about 45 minutes of original mobile video per day. While the hype is on video, in the reality of what sports fans want, video does not rank as high as one might suspect.

They want stats, scores and updates. They want to know how their fantasy players are doing and how they rank against other fantasy teams in their leagues. These are the utilities that they are really looking for when they are away from their computer.

It’s almost like the first thing they want now is to get espn.com content, which also has video, but is clearly a different experience than what’s on television. We have 100,000 unique daily visitors [to the cell-phone Web site] each month, and 360 million monthly impressions.

MCN:What’s the economic model?

SM: We cut deals with the carriers where we participate in the incremental revenues that are generated. The models are somewhat different between them.

MCN:Mobile ESPN launches Feb. 5. Are you selling phones yet?

SM: We are selling it today. [The ESPN-branded phone is] available at www.mobileespn.com. The national marketing begins Feb. 5, and that’s when it will be available nationwide at Best Buy Stores.

MCN:How does the launch of Mobile ESPN compare with launching ESPN HD or ESPN 360?

SM: Mobile ESPN is the largest [launch], in the sense that it is very different from launching another television network. It’s a unique [medium].

We think this is by far the best and most immersive service that’s available on a cell phone today. It is because unique things are possible when you are picking the handset, designing the software, designing the user interface and doing it all from the perspective of a sports fan.

When you can control that entire stack, there is an amazing amount you can do to enhance the actual experience beyond what a carrier can do. We can provide you with contextual video, so you are looking at a score, you can see that there is a highlight right there, as opposed to MobiTV, which is serving cable television on your phone. MCN: Will do you do more video for Mobile ESPN? Is there a different target number?

Mehta: Whatever video is available, we want to make it available. We’re not targeting a number.

MCN; How will the experience differ from V Cast and Mobi TV?

Mehta: With all due modesty, we think this is by far the best and most immersive service that’s available in a cell phone today. It is because unique things are possible when you are picking the handset, designing the software, designing the user interface and doing it all from the perspective of a sports fan.

When you can control that entire stack, there is an amazing amount you can do to enhance the actual experience beyond what a carrier can actually do. We can provide you with contextual video, so that when you are looking at a score, you can see that there is a highlight right there, as opposed to MobiTV, which is serving cable television on your phone. It’s a very different experience.

MCN: What highlights rights do you have from Major League Baseball, the National Football League, the National Basketball Association and National Hockey League for Mobile ESPN?

SM: We have MLB and NHL rights. We are in discussions with the NBA. We do not have the NFL now, but we will starting next season with in-game highlights for Monday Night Football.

We will have video content surrounding all the sports, but it’s broader than just game highlights. It’s the full experience ESPN can offer — reporting and analysis from our talent and experts; athlete and coach interviews and press conferences, clips from ESPN studio shows and programming, like Pardon the Interruption. Game highlights will be just one of our offerings.

MCN:How do you approach what content and information you put on ESPN.com versus ESPN 360? How much video is on ESPN 360?

SM: ESPN 360 is the deepest possible video information available that we have from ESPN. It is the best interactive experience that taps what is great about the networks and what is great about the Internet’s ability to driver personalization and interactivity.

On ESPN.com it’s different. It’s free. Many of the highlights are there. On 360, we actually have games. We did more than 100 live events this year, college sports, etc. On ESPN 360, things don’t come off the site. What we want to provide is an incredible library of content there.

MCN: Many traditional TV channels are worried about the shift of ad dollars to the Internet, although many are creating their own broadband Web sites on which they are selling ads. MTV Networks and News Corp. have pegged Internet ad revenue on their sites at between $75 million to $100 million. Can you tell how much revenue ESPN.com generates?

SM: I can’t.

MCN: Are TV ad dollars migrating to ESPN.com? What’s the trend line?

SM: What we have core on our network are things that people want to watch live. We don’t suffer from some of the same fears that will affect your traditional broadcaster. We also think we have a very targeted offer for advertisers, because of the male 18-to-49 demographic that is typically an enormous sports fan.

We believe that we really have a relationship with those viewers where they touch ESPN in many different media, whether it’s dot.com, mobile publishing, mobile phone. We have the ability to give unique and tailored solutions to advertisers that take advantage of the unique properties of the specific medium. We believe we are only scratching the surface of what advertising could become.

MCN: Do you ever see a day when the dot.com properties generate more revenue than the television side?

Mehta: Not for a while.

MCN: What about licensing content to Google, Yahoo, America Online or MSN?

SM: We have an existing relationship with Yahoo Overture to provide paid search on our Web site. The reality is that when a person goes to the Web, and is looking for sports, they punch in the EPSN URL or they click on that ESPN.com bookmark. That is what we believe we’ll be able to continue, because we have, different from those companies, an ability to serve across platforms.

The key thing is the relationship we build with our consumers that starts with television, but then extends across all these other media.

With our core group, it’s the first channel they go to on television. It’s the first Web site they go to when they get to work. That is a unique relationship that we have. Sure, there are people who have bigger traffic numbers. There are cable channels that have bigger ratings than ESPN. Nothing comes close to the depth of relationship that we have with our fans.

MCN:
What will you look for at the Consumer Electronics Show?

Mehta: It’s a soak-all in experience. I’ve been to CES for the last six years now. It’s not any specific product. It’s really the broad trends.

It’s seeing whether some of the trends that have been talked about awhile are actually at a price point and level of ease of use to make it easy. What’s going on with home networking, those kinds of things. What I’m most focused on are the various mobile business products -- new handsets, new user interfaces.

<p>ESPN’s Multiplatform Picture</p>

Mobile:

Mobile ESPN — Cell phone service set to launch Feb. 5, which will provide sports fans scores, stats, information, commentary, games, graphics, photos and video highlights.

Mobile ESPN Publishing — Sports scores, stats, information and video on Vcast and Mobi TV.

Internet:

ESPN.com

ESPNDeportes.com

ESPNsoccernet.com

ESPN 360 broadband Web site.

VOD:

ESPN On Demand, ESPN Deportes On Demand, ESPNU On Demand — Five to 10 hours of news and library programs in each package.

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