ESPN Releases Impressive Mobile App, But Only Lets A Small Number Of People Use It

ESPN Releases Impressive Mobile App, But Only Lets A Small Number Of People Use It

It looks like ESPN has gone and released a pretty cool mobile app, watchESPN, for viewing a streaming feed of the Mothership networks. Peter Kafka of MediaMemo gives it a pretty positive review here. Same with Dave Zatz at Technologizer here. The released app is available as an iPhone app with Android and iPad optimized releases planned.

Then there is the kicker. Per Kafka:

Disney’s network has carriage deals so far only with Time Warner Cable, Brighthouse TV and Verizon FiOS. That covers 18 million homes, but that won’t make you any happier if you don’t live in one of them. It’s worth noting that Comcast, the country’s biggest cable provider, isn’t included here, even though it has previously set up broadband programming deals with ESPN.

Let’s do the math on this. 18 million eligible homes, US Smartphone adoption is at 31% and iPhone has 25% of the smartphone market. 18M * 31% * 25% = 1.395M. It’s a very crude analysis, but it may put help put the current and potential user base in perspective. Lets give ESPN credit for the other 33% of the smartphone market they could reach when the Android app comes out and you are still looking at a statistically likely potential install base of 3.2M users under those terms. By the time they find mass adoption the game will have changed.

The market is moving faster than ESPN, and to be fair sports media as a whole, is adjusting. Demand for streaming sports content is already here. Multichannel News reports that during the first two weeks of the NCAA basketball tournament, the March Madness on Demand iPhone and iPad apps had 41.6 million visits and delivered 12.7 million hours of streaming video, up an eye popping 60% over last year.

This continues to be the elephant in the room that ESPN has yet to acknowledge. ESPN’s position as “The Worldwide Leader” and long term media rights deals have incented them to help maintain the status quo, where ESPN charges large carriage fees to cable providers who control consumer access to programming. But as I’ve pointed out before, that control, and scarcity of distribution, is quickly becoming an illusion.

There are many parallels between what’s going on in video today to what happened to the music industry (and there are differences, to be fair), but ESPN is reading from the same playbook that crippled many music industry heavyweights a decade ago. ESPN is a dominant incumbent with many natural and existing advantages, but their ability to come out “on the other side” just as dominant will probably depend on their willingness to separate themselves from the fate of the cable companies and forge new business models that fit with emerging media consumption patterns.