At its annual meeting with shareholders Thursday, Disney Chief Executive and Chairman Robert Iger touted record-breaking box-office results and unveiled plans to build new cruise ships and theme park attractions.
But Iger was confronted with questions from investors about the health of ESPN, the company’s sports network which has been a cash cow for a long period of time.
With an unspecified number of subscribers lost in the most recent quarter and shares of Disney slumping since August, investors have become nervous about the state of the company’s TV business. Analysts and investors have added to that fear by highlighting how the company has dished out expensive sports rights fees during a time when a large number of consumers are slashing or abandoning their cable service.
“There’s this perception of ESPN dragging us down,” one shareholder said as part of comments directed at Iger. “How do we change the market’s view of the company?”
Iger strongly defended the sports network’s business, saying “ESPN is a healthy business and a large business … and a growth business.”
Iger added that ESPN is the most-watched sports network in the country, watched by over 200 million people across various platforms each month. Still, he said it was unlikely that ESPN would keep growing at the rate it has over the past two decades and he’s been working to make sure that journalists and investors are fully aware of ESPN’s dominant position in the media marketplace.
One shareholder pressed Iger on what Disney was doing to make the network available to consumers who don’t have cable or satellite television, or are considering cutting the cord.
Iger said Disney is exploring different ways to distribute ESPN content on new platforms. This week Disney networks, including ESPN and ABC, launched on the Sony PlayStation Vue service, which offers a way to reach younger viewers who are less likely to subscribe to a traditional pay-TV package. ESPN is already featured on Dish Network’s Sling TV streaming service.