ESPN anchor Sara Walsh, a host of the Disney network's flagship SportsCenter program, was laid off this week just after returning from maternity leave. Walsh was dismissed a week after ESPN let go about 100 on-air commentators, writers and producers as Disney's most-profitable unit turns its focus to mobile distribution amid accelerating declines in subscribers to its cable TV network.
Walsh's exit adds to a pool of roughly 10% of the 1,000 ESPN employees whose roles are among the highest profile at the network. The dismissals are partly a response to declining revenue and partly a recognition that ESPN needs to change its programming formats.
Upon returning to work on Thursday, Walsh was informed she's been let go.
ESPN President John Skipper sent a message to network's employees last week, explaining that the layoffs were aimed at giving the company greater flexibility to create content for mobile platforms.
"Dynamic change demands an increased focus on versatility and value, and as a result, we have been engaged in the challenging process of determining the talent necessary to meet those demands," Skipper said in the email. "We will implement changes in our talent lineup this week. A limited number of other positions will also be affected, and a handful of new jobs will be posted to fill various needs."
In addition to Walsh. ESPN dismissed longtime on-air personalities Jayson Stark and Jim Bowden, two high-profile baseball analysts; baseball writer Jim Caple; NFL reporter Ed Werder; NFL analyst and former player Trent Dilfer; Tennessee Titans writer Paul Kuharsky; college basketball reporters Dana O'Neil and Andy Katz; NBA draft analyst Chad Ford and reporter Marc Stein; and hockey writers Pierre LeBrun, Scott Burnside and Joe McDonald. Both Deadspin and Awful Announcing compiled running lists of all the cuts.
The change in personnel at ESPN comes as subscriptions to cable TV services declined at a faster rate in 2016 than at anytime in history. U.S. pay-TV providers lost as many as 1.9 million subscribers last year, according to industry research group SNL Kagan. That estimate was slightly higher than a similar study by MoffettNathanson, which put the subscriber loss at 1.7 million.
Either way, the effect on ESPN has been formidable.
ESPN charges pay TV providers an average of $7.86 per subscriber per month to carry the network, according to SNL Kagan. To appreciate the outsized presence that ESPN has on the traditional cable TV bundle, the second-most expensive network, Time Warner's (TWX) TNT, comes in at a comparatively small $2.02.
As more households become cord-cutters and fewer new households subscribe to cable TV, the impact on ESPN is significant. By some estimates, ESPN is losing as much as $60 million per month in revenue. Meanwhile, the network is on the hook for as much as $7 billion in rights fees to televise games this year of the National Football League, the National Basketball Association, Major League Baseball and many of the country's largest college athletic conferences.
Audiences have been gradually changing their viewing patterns in recent years but in 2016, the trends appeared to accelerate.
Audiences are spending more time with on-demand subscription services such as Netflix (NFLX - Get Report) and Hulu as well as social media platforms such as Facebook (FB - Get Report) and Alphabet's (GOOGL - Get Report) YouTube. At the end of 2016, ESPN counted 88.4 million subscribers; in comparison, the network in 2010 drew fees from more than 100 million subscribers.
While ESPN has had larger rounds of layoffs before, last week's was expected to be the largest among on-air personalities in the company's history. The Bristol, Conn., network was founded in 1979 as the country's first 24-hour sports network.
ESPN reporter Ed Werder revealed in a tweet that he had been laid off:
After 17 years reporting on #NFL, I've been informed that I'm being laid off by ESPN effective immediately. I have no plans to retire— Ed Werder (@Edwerderespn) April 26, 2017
Tennessee Titans writer Paul Kuharsky also tweeted he will depart in July.
Knew cuts were coming. Sad to say nine great years at ESPN end for me in July. Please stay tuned to @Midday180.— Paul Kuharsky (@PaulKuharskyNFL) April 24, 2017
Hockey writers Pierre LeBrun, Scott Burnside and Joe McDonald indicated they were let go.
Well folks, as you can tell by my new Twitter handle, I was also among the cuts today at ESPN.— Pierre LeBrun (@PierreVLeBrun) April 26, 2017
After 13 years of sticks and pucks can share that as of today my tenure at ESPN is at a close. I look forward to the next adventure.— Scott Burnside (@OvertimeScottB) April 26, 2017
After nearly eight years of covering the NHL, MLB and the NFL at ESPN, it's time for the next chapter in my career.— Joe McDonald (@ESPNJoeyMac) April 26, 2017
College basketball reporter Dana O'Neil, meanwhile, said her contract had not been renewed.
Add me to the list. Just got the 'call.' I've been informed my contract will not be renewed at ESPN.— Dana O'Neil (@ESPNDanaOneil) April 26, 2017
And soccer writer Mike L. Goodman added a coda to his note that April 26 would "suck for a lot of people at ESPN."
And hey, it turns out one of those people is me. Loved my time at ESPN, and now it's time to figure out what's next.— Mike L. Goodman (@TheM_L_G) April 26, 2017
ESPNU anchor Brendan Fitzgerald and Big Ten reporters Austin Ward and Jesse Temple also are among the layoffs.
I've been informed that I'm no longer employed at ESPN. Greatly enjoyed covering the B1G, and will immediately try to find a new challenge!— Austin Ward (@AWardESPN) April 26, 2017
Like other colleagues, I've been informed I am no longer working for ESPN. This is a crummy day, but I'll never stop pursuing my passion.— Jesse Temple (@jessetemple) April 26, 2017
Profit at Disney in the quarter ended Dec. 31 missed analyst expectations in part because of higher programming costs at ESPN. Shares of the Burbank, Calif., parent have underperformed the broad market over the past year, gaining 10% compared with 14% for the benchmark S&P 500 index.
Disney shares were little changed on Wednesday morning, up 0.45% to $115.70. Disney is scheduled on May 9 to report its second-quarter earnings for the period ended March 31.
ESPN declined to comment on the layoffs.