Disney, WBD Chiefs Lament New Sports Media Challenges

ESPN parent Walt Disney Co. and Turner Sports parent Warner Bros. Discovery are two of the largest and most powerful players in sports media, each enjoying a pervasive presence. 

But in the midst of unprecedented change and heightened programming costs across the entire media landscape, leaders of both companies are openly lamenting the economic challenges sports are placing on their respective operations.

Speaking separately on Wednesday at The New York Times’ DealBook Summit, Disney CEO Bob Iger and WBD CEO David Zaslav each acknowledged that managing their sports media operations has grown significantly more complex.

“I love the sports business,” Zaslav said. “But the only product that we rent at Warner Bros. Discovery is sports. And when you rent a product, it’s always hard. When we do something great with ‘Lord of the Rings,’ it belongs to us. When we do something great with sports, we get to enjoy it and benefit from that until the deal is up. And when the deal is up, you get new rent.”

Zaslav has previously balked at the notion of extending at nearly any cost its NBA relationship of more than four decades, and was again measured on the subject as negotiations continue.

“We’re talking to Adam now,” Zaslav said, referring to NBA commissioner Adam Silver. “In the end, it has to make economic sense.”

Mouse House

Iger struck a somewhat similar tone as Disney continues pursuing efforts to sell a portion of ESPN to a strategic partner, a process carrying some uncertainty.

“People love sports, and we have an unbelievably unique position in the world of sports,” Iger said. “We want to stay in that business. It is a healthy business for us today, and it will continue to be … But like our other businesses, it has relied on a business model that is not as robust as it used to be.”

When questioned about the recent assessment of LightShed Partners analyst Rich Greenfield — who said that ESPN has an existential conflict of its programming costs rising faster than revenues — Iger flatly disagreed.

“I like him, but I’m not getting advice from him right now,” Iger said.