George Bodenheimer

October 2007

ESPN has become a multi-platform, one-stop shop for sports fans. In the U.S. it provides sports coverage to the ABC network, programs six cable channels, offers pay subscription packages and operates 31 international channels. Beyond television, ESPN’s businesses include radio networks, websites and broadband, publishing, mobile, consumer products, even ESPN Zone restaurants and stores. George Bodenheimer, the president of ESPN, Inc. and ABC Sports, and co-chair of Disney Media Networks, explains how maintaining that special connection with sports fans has remained the key to success of all of ESPN’s businesses.

WS: What has contributed to the ongoing strength of the ESPN brand – and what fuels the kind of loyalty that prompted a viewer to say, “If ESPN were a girl, I’d marry her!”?

BODENHEIMER: That comment came from a letter in our early years. What I find amazing today is that 30 couples have told us they named their babies after ESPN with variations like “Espen.” Very few companies can claim this affinity with their customers or as we like to say—fans.

Several factors contribute to this fan loyalty. Not only were we the first to provide an all-sports national television channel, we continually focus on our mission to serve fans better tomorrow than we do today. The special connection we have with fans really comes from our employees’ day-in and day-out efforts behind the scenes and from how our commentators engage fans on air. We don’t talk down to fans. We talk as if we were on the sofa watching sports with them.

We describe the ESPN brand as “Sports with Authority and Personality.” Our personality shines through the commentators as well as our award-winning promotional spots that take fans behind the scenes at our Bristol, Connecticut, studios for humorous moments. And by the way, we do answer those viewer letters, e-mails and phone calls, which reinforces that we care about their feedback.

WS: How does ESPN keep track of what sports fans want?

BODENHEIMER: Through our traditional television ratings, formal research surveys, focus groups, coincidental phone surveys, viewer response reports, and now interactively through our websites, as well as anecdotally. When I meet fans through my travels, I ask them what they like, don’t like and what they want more of. Obviously we don’t just react to feedback, we also work to innovate, and to develop new concepts and ideas that we think will appeal to fans. The X Games is the best example of this.

WS: Sports rights can be very expensive. What is ESPN’s general strategy when acquiring sports rights?

BODENHEIMER: The big game remains a social touchstone. Last year our NFL Monday Night Football series broke the record for highest basic cable ratings. Our FIFA World Cup football coverage resonated with fans in 2006 and we expect 2010 in South Africa to be a major event of interest amongst fans. We look for Major League Soccer to grow in the U.S. with David Beckham’s arrival. ESPN’s telecast of his first appearance in an MLS International match—Chelsea FC at LA Galaxy—was the most-viewed MLS telecast ever on ESPN or ESPN2.

We have secured long-term rights agreements with the NBA, Major League Baseball, NASCAR, major college football and basketball conferences, and more. As part of the rights/value exchange, we negotiate for a wide range of multimedia, digital and international rights.

We also know that we can’t own it all. We passed on U.S. TV deals for the NHL and PGA Tour golf. However, they wanted to stay involved with ESPN and did digital and international rights deals with us.

WS: How much demand is there for multimedia rights and how is this demand growing?

BODENHEIMER: Our newer TV networks and our digital media are growing in households and users. ESPN.com’s PodCenter (audio and video podcasts) was launched in April 2006 and it has grown 1,000 percent in unique visitors. During April this year, it averaged one million unique users and 4.5 million downloads. It’s happening.

Years ago, in 1999, we invested in and later acquired soccernet.com in the U.K., and we’ve since expanded the service to four languages—French, German, Italian, Spanish—in addition to English. We recently acquired cricinfo.com, the world’s leading cricket site and scrum.com, a leading rugby news, scores and information portal.

In addition to our wireless content for mobile devices, we launched ESPN Mobile TV, our first-ever 24/7 wireless channel. It features live games and shows. Internationally, ESPN now provides wireless content on five continents, in 32 countries, in 10 languages.

WS: What does ESPN offer advertisers?

BODENHEIMER: ESPN offers advertisers engaged, loyal customers, heavily skewed to young males who are early adopters of new technologies and gadgets. Nearly 70 percent of all advertising deals of $2 million or more in the U.S. have at least one medium other than television in the package.

WS: How important are the international channels to ESPN’s total business and revenues?

BODENHEIMER: I now think of ESPN as a global sports media company and not a U.S. sports TV company. Our international and digital media businesses will be key drivers of ESPN’s future growth. They are both areas we continue to invest in through product development, organic growth and acquisitions. We have 33 TV networks outside of the U.S., which are complemented by radio, online, broadband, print and wireless in various markets. Our goal for each of our networks regardless of location is to serve fans. Our ever-growing SportsCenter franchise, which now has 14 international editions of the show, is our best example of how we have really evolved in this area recently.

WS: Where are the growth areas for more channels? And do you look to expand distribution of existing channels or also creating new brands?

BODENHEIMER: In the U.S., we have been focusing on the growth of two TV networks that were launched in recent years: ESPN Deportes, our network focused on U.S. Hispanic fans, and ESPNU, our college sports network. In Europe, we recently acquired NASN, and we continue to grow ESPN Classic, which now reaches 22 million households across Europe, and we will continue to monitor the marketplace for TV opportunities.

WS: How are new media—broadband, mobile phones—extending the sports fans’ connection with ESPN?

BODENHEIMER: Sports fans are consuming content in more ways than ever. The growth of our broadband service ESPN360 in the U.S. has led us to roll out the concept with local executions outside the U.S. Our first effort was the recent launch of ESPN360 in Mexico and you should expect to see future launches from us around the world.

The U.S. version of ESPN360.com was just relaunched as the home of live sports events online. In the next 12 months, more than 2,000 events will be available. Viewers will be able to select from a menu of simulcasts and other sporting events not shown on our TV networks.

WS: How much demand is there for pay-per-view events on ESPN?

BODENHEIMER: We look at three categories. The traditional “pay per view” events are occasional opportunities like major boxing events, martial arts, fantasy league programs. We just did the final table at the World Series of Poker as a live PPV event. Starting last year we also made UEFA Champions League matches available online as pay-per-view offerings.

On-demand program offerings are growing. That’s when premier shows are made available in advance or a day or so after the original airing and they run through a specific time frame for convenient viewing. Various business models are being tested: per show, monthly fees and advertising by disabling the fast forward.

We also distribute seasonal sports pay packages with a lot of “out-of-market” games like ESPN GamePlan with around 150 college football games a year, and ESPN Full Court, with about 400 college basketball games, for those who can’t get enough of their sport. We don’t provide specific buy numbers but GamePlan and Full Court have experienced double-digit growth year over year.

WS: Besides major sports events, games and matches, how important have ESPN’s sports news programs, such as SportsCenter become both domestically and internationally?

BODENHEIMER: SportsCenter was ESPN’s very first show in 1979. We knew it was not just about the games. Sport is social currency—talk around the water cooler about what happened in last night’s game. Fans want news and opinion. That’s how we built the pre-eminent sports news show, SportsCenter. We now have 14 SportsCenter versions around the world in eight languages. SportsCenter spawned specific sports news and information shows like Baseball Tonight, NFL Countdown and a 24-hour network, ESPNEWS. Our news operation is a very important franchise by all measures and it will continue to grow globally.

WS: In what areas do you see growth for the company in the next two to three years?

BODENHEIMER: Internationally and digitally. It’s as simple as that.

WS: You have been at ESPN for many years—what has kept you at the company for so long? What do you enjoy most about your job?

BODENHEIMER: I am continually energized by our people—their passion for what they do, their new ideas, their ability to deliver great quality content to fans every day, around the clock, around the world, through all media. They have built this incredible brand.