There’s been a lot of buzz around the idea of sports networks refunding distributors who then refund customers for per-subscriber fees thanks to the current lack of live sports, but John Ourand of Sports Business Journal has poured some significant cold water on that, particularly in the case of ESPN. Unlike regional sports networks, ESPN has still had some high-viewership content in the last few months (specifically, the NFL draft and The Last Dance), but they’ve still been at the center of a fair bit of this debate. But as per Ourand, their contracts may provide them some significant protection, as their event promise is reportedly over a 12-month period, and even if they missed that target, they’d have another six months (until September 2021) to remedy the situation before distributors can start seeking rebates under the contract.
Before we dive into the details of the newest report, though, it’s worth looking at the backstory here. Late last month, Rich Greenfield and other analysts from LightShed Partners argued for distributors to use force majeure clauses to try and get rebates from sports networks they could then pass on to consumers, citing ESPN (which has the highest per-subscriber fees out there) in particular. And while that piece drew some deserved skepticism, Dish (known for their cost-cutting efforts and willingness to push back on sports channels) did reportedly try to withhold per-subscriber payments to ESPN for April (it’s unclear if they actually went through with that or not).
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