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Leading sports network makes a major investment in future

BRISTOL/SOUTHINGTON — Construction workers run the wiring through the floors of the black cavernous rooms sealed off by 10-inch-thick metal doors.

Dozens of monitors are readied for hanging below an over-head mesh cage that allows workers to manipulate lights aimed at the large studio sets below. It feels like a trampoline, one worker said.

For sports fans across the globe, this is hallowed ground.

ESPN’s Digital Center 2 is a 198,000-square-foot behemoth filled with production centers, 16 edit rooms, five new studios including a 10,000-square-foot SportsCenter studio to be ready in May 2014, and a same-sized studio dedicated exclusively to the network’s around-the-clock NFL programming. The expansion includes the construction of a visitors center on the Southington side of the Bristol-Southington town line.

ESPN’s physical expansion in Bristol and Southington is the result of a need to keep up with its operational growth and bring more production to its headquarters. It’s also a validation in the eyes of local officials that ESPN will remain a regional economic driver.

“We’re obviously pleased they’re expanding into Southington but the bigger picture is that they continue to do well regardless if it’s Southington or Bristol,” said Southington Economic Development Coordinator Lou Perillo. “Their strength is regional not just Southington or Bristol.”

ESPN employs 4,000 people at its West Street headquarters and an additional 2,500 worldwide. Earnings are now estimated at roughly $42 billion, according to earnings reports. Last year, ESPN brought in approximately $9 billion between advertising revenue and subscriber fees – about $5.15 per month from all cable subscribers. That’s set to top $10 billion this year, according to earnings reports. Disney owns about 80 percent, with The Hearst Corp. holding the rest.

ESPN continues to draw much of its bread and butter from its NFL coverage. In the last two years, ESPN has made huge deals for sports rights. It paid $15.2 billion for 10 years of Monday Night Football — a 73 percent increase over the cost of its previous rights. It also paid $7.3 billion for college football playoffs.

But analysts say that with Disney’s bankroll, ESPN can keep its Goliath status and leave its scraps to smaller players such as the new Fox Sports 1.

“ESPN is in extraordinarily strong condition with basic cable subscribers,” said media expert Richard Hanley, an associate professor of journalism and director of the graduate program in journalism at Quinnipiac University. “Fox gets less than 50 cents. That bridge has to be gapped to match ESPN’s revenue stream. The other area is advertising. ESPN has a great hold on that.”

Company market research showed that the football audience — especially the most avid fans – values ESPN’s expertise both on national-level NFL content, as well as team-specific content, according to ESPN Insider. This season, ESPN expanded its NFL Nation and launched a daily show called NFL Insiders.

“Whether it’s in season or out of season, fans crave NFL news and that’s exactly what NFL Insiders will have every day with a smart presentation and some of the most connected people in the league,” Seth Markman, senior coordinating producer, said when announcing the program this spring.

ESPN’s investment in its NFL and college football coverage has paid off. Monday night football averaged 12.8 million viewers per game and is the most popular series on cable television, said ESPN spokesman Mike Soltys. It’s telecast of the 2013 Bowl Championship Series (BCS) National Championship was the second most viewed program in cable television history with an average of 26,380,000 viewers, Soltys said.

Questions about whether ESPN’s relationship with the NFL had compromised its journalistic objectivity arose last month when PBS’s Frontline announced that the sports network had dropped its 15-month collaboration on concussion reporting two months before the airing of the documentary “League of Denial: The NFL, Concussions and the Battle for the Truth.”

The collaboration was based on Frontline’s journalism and the work of two ESPN reporters, Mark Fainaru-Wada and Steve Fainaru. The documentary was based on the brothers’ book by the same name that according to the book’s description “examined how the NFL, over a period of decades sought to cover up and deny mounting evidence of the connection between football and brain damage.”

Frontline announced the breakup before ESPN did. When representatives in Bristol responded, they said that, due to ESPN not producing nor exercising editorial control over the Frontline documentaries, there would be no co-branding involving ESPN on the documentaries or their marketing materials, according to an Aug. 25 Sports Illustrated article.

NFL representatives have denied putting any pressure on ESPN, the article stated.

And ESPN reminded critics that it had covered concussions since the 1990s and will continue to cover it. Management said it will continue to support the work of Fainaru-Wada and Fainaru. And staffers, including the two authors, told reporters that the network’s investigative team with the news program “Outside the Lines,” will continue to do aggressive, smart reporting.

But journalists and analysts questioned how ESPN can remain objective when investigating powerful partners, or whether it should rebrand itself as a sports information and entertainment network.

“That’s long been a question,” said Hanley. “How do you investigate what amounts to a partnership? Not only with football, but with Major League Baseball. It made the network look bad.”

Hanley said ESPN needs to maintain some level of newsgathering because the viewer expects that. He said college football has plenty of opportunities for investigative reporting, and the concussion issue is not going to go away anytime soon.

“There will be others with money,” Hanley said. “They are going to need a great deal of transparency. ...They are going to have to step on some toes.”

Hanley said he’s confident that the attention given to ESPN’s split from the project is going to draw more viewers when the documentary airs on PBS Oct. 8.

But the fallout from the documentary won’t be enough to cause lasting harm among average ESPN fans, media watchers said.

The Bristol expansion is designed, among other things, to make ESPN better equipped to produce more content in house than on the road. For instance, the World Cup which was produced in South Africa, will stream from South America and be produced in Bristol this year.

ESPN’s two-story building follows the same architecture of ESPN’s Digital Center 1, but with upgraded equipment.

“This is the main lobby,” said Kevin Stolworthy, ESPN’s vice president of technology. “We’ll have a ticker, like Times Square.”

Stolworthy explained the use of automated production equipment that can reduce the number of crews working on a show package from five people to three.

“Most of the broadcast industry is automated,” Stolworthy said. “Their goal is to save costs. Our goal is more product. One of the goals is to bring more events back to Bristol. Having an infrastructure here allows us to be more flexible.”

The two-story building, built by the same architect as Digital Center 1 will have no offices, a couple of conference spaces and a wealth of production space designed to house all ESPN’s NFL programming. Company representatives are mum on the exact price tag.

Soltys said ESPN notified the state it would cost more than $25 million.

“We exceeded that a long time ago,” he said.

ESPN is constructing its first building on the Southington end of the sprawling campus. A 5,000-square-foot visitor’s center for processing and greeting the many visitors that come to ESPN daily, either as show guests or to attend corporate meetings, is coming to ESPN Drive.

A former parking lot between DC1 And DC2 will become a courtyard and gathering place for workers, while an enclosed catwalk connects the two buildings on the second floor.

Southington is also home to ESPN’s satellite dish farm that was recently moved from the front of the building onto a hill. A 300-space parking lot is also being added to the Southington side.

ESPN management says it recognizes the value the network brings to both communities. Soltys and Stolworthy both live in Southington and the company’s workers and guests frequent the restaurants and hotels in Southington more than in Bristol. Subcontractors in both towns are also benefiting from the construction work.

But the men are quick to point out that despite the expansion satisfying Southington officials and businesses, Bristol gets the bigger tax benefit.

ESPN is Bristol largest taxpayer and paid $7.1 million last year, according to Tax Assessor Thomas DeNoto.

“Their (economic) impact has been evolutionary,” said Michael Nicastro, president of the Central Connecticut Chambers of Commerce.

When they first started in 1979, ESPN was two men in a van. But as the company grew in the 1980s, Bristol had its biggest employer New Departure close down. ESPN grew to fill that void.

“ESPN was the counterbalance,” Nicastro said. “As a tax base it filled the void and put us in a position to replace New Departure.”

Bristol was able to fill the vacancy with Firestone and a large manufacturer, thus replacing some of the same types of jobs it lost.

“The presence of ESPN helps us draw a lot,” Nicastro said “People are going to look for where other companies are located. Schools, housing, workforce, all those things are going to come into play.”

“If you look at the overall benefit,” said Perillo of Southington, “the expansion is a testament to their strength.”

mgodin@record-journal.com (203) 317-2255 Twitter: @Cconnbiz



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