WASHINGTON — Last year was rough for ESPN, full of big-name departures, doom-and-gloom forecasts about the company’s once-unparalleled revenue streams, and layoffs, with about 300 employees let go amid cost-cutting demands from parent company Disney.
This year isn’t starting any better — and not simply because of plummeting TV ratings from the College Football Playoff semifinal games on New Year’s Eve and Monday’s title game.
A survey of 1,582 consumers commissioned last week by BTIG Research found that 56 percent of respondents would remove ESPN and ESPN2 from their cable packages to save $8 per month, which is about the cost cable subscribers pay to receive the networks.
Broken down by gender, 60 percent of female respondents and 49 percent of male respondents said they would remove the sports networks to save money.
‘‘Even more interesting, results did not vary by age, with Millennials, Gen X’ers, and Boomers all similar, adjusting for the survey’s margin of error,’’ BTIG Research’s Richard Greenfield wrote in a story about the survey results.
ESPN’s business plan has long been dependent on fees paid by cable subscribers, most of whom pay for the channel whether they watch it or not as part of a bundle of offerings. But that model has been threatened by cord-cutting — consumers jettisoning cable altogether in favor of online streaming services such as Netflix or HBO Go, combined with the astronomical increases in fees paid by ESPN to sports leagues to carry live events.
Last year, for instance, Disney/ESPN signed a deal with the NBA that will cost the network $1.4 billion per year over nine years to show professional basketball games, three times the amount of the previous rights agreement.
Seven million US households have dropped ESPN in the past two years, Disney said in a federal filing submitted in November. Its subscription base is down to 92 million homes, the lowest in nearly a decade, and the operating profit Disney expects to receive from ESPN — its most profitable cable channel — is expected to flatten this year, leading to a cost-cutting mandate from Disney.
To combat these losses, Disney chief executive Robert Iger has said ESPN is prepared to offer a direct-to-consumer subscription service, in which consumers would pay for ESPN programming by itself without subscribing to a cable package.
However, this plan also presents a certain amount of risk. As previously noted, if 30 percent of ESPN’s current subscribers shifted to paying for the network via an online service, Disney would need to charge about $20 per month to make up for the revenue from lost cable subscribers.
BTIG Research also asked about this in its survey, and its results were similarly bleak for ESPN and Disney. The survey found that only 6 percent of respondents would subscribe to ESPN and ESPN2 at $20 per month, with 85 percent indicating they wouldn’t and 9 percent saying they weren’t sure.
‘‘The reality is that ESPN would likely have to charge dramatically more than $20/month/sub in a direct-to-consumer model, given the dramatic reduction in penetration rates,’’ Greenfield writes, pointing out another strike against this plan: Many consumers wouldn’t subscribe to such a package on an annual basis, instead turning it off or on depending on the time of year (NFL fans only subscribing during football season, for instance).
An ESPN spokesman said the network would have no comment about the survey. In comments made to CNBC in July, Iger described as ‘‘conjecture’’ the predictions that Disney would have to charge $20 and up for a direct-to-consumer ESPN service to be profitable. In August, he told CNBC that the bundling of ESPN in cable packages still is a viable business model.