What Sports Networks Should Heed From the Cancellation of ‘The Late Show With Stephen Colbert’

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Are sports television networks listening? When CBS pulled the plug on The Late Show with Stephen Colbert, it ended a franchise player of the network for over 30 years—a direct head-to-head competitor that the network created to challenge its rival at NBC and their Tonight Show franchise. For generations, the back-and-forth ratings battle was intense, as every night seemed like must-see television with the two sides doing anything to entertain audiences to grasp the biggest number of viewers possible.

Does the cancellation of The Late Show serve as a warning shot to professional sports networks such as ESPN and FOX Sports?

Many will scoff at the idea of sports television networks canceling shows surrounding their sports programming. I get it. However, the reasoning CBS gave behind the cancellation should be heard loud and clear by everyone, including sports television networks.

Political leanings aside, The Late Show with Stephen Colbert cost a lot to produce. Reportedly, the price tag to create the program was near $100 million a year, with advertising revenue reportedly down over 50% compared to 2018. The show may have had the highest viewership of the competing late-night programs currently, but the amount of viewership compared to 2018 had also dwindled.

The Old Model Is a Formula for Disaster

Reduced revenue, ratings, and high expenses spell a formula for disaster in any type of media—especially in Colbert’s case, where a media company on the brink of being sold was looking to cut expenses and improve its bottom line in preparation for sale.

Isn’t this exactly what FOX Sports just went through with Breakfast Ball, The Facility, and Speak? High expense, low viewership, and limited revenue?

What is happening to The Late Show franchise is exactly the same as what happened with FOX Sports last week, which resulted in a phone call to Barstool Sports.

FOX Sports decided to license out their programming time slots in a partnership with the digital sports content hub, where Barstool (not FOX Sports) will produce a two-hour program to air on FS1 in the mornings to compete with ESPN’s Get Up. The show will then (reportedly) repeat from 10 a.m.–12 p.m. to go head-to-head against ESPN’s First Take.

In FOX Sports’ mind, why pay the massive freight for talent, staff, and production if you can pay someone else to do it for you? What’s to say CBS doesn’t follow that model for their coveted 11:35 p.m. time slot in May—replacing a personality-driven talk show with one that already thrives digitally that the network doesn’t have to invest in like the current Colbert model?

ESPN Programming Questions To Ponder

Could ESPN be next?

The simple question all these networks need to ask when it comes to programming is: Is the juice worth the squeeze? Is the amount of money any network (sports or non-sports) is shelling out to produce its own programming worth the investment? Is the product driving influence, viewership, and revenue enough to keep around?

Let’s look at a couple of examples with ESPN.

Was Tony Reali too expensive to keep around at ESPN? They canceled Around the Horn and have yet to give a reason why. Assuming each of the four panelists were compensated in some fashion, the network was compensating five talents per day, five days a week, for nearly 5,000 episodes. The network also siloed Reali from any other ESPN programming focusing his talents only on Around the Horn.

Was the juice worth the squeeze? Reali is now the most-sought after free-agent in sports television.

Dan Le Batard hinted the other day that Michael Wilbon’s contract runs up in August. Tony Kornheiser and Wilbon have been hosting Pardon The Interruption for nearly a quarter-century. Both are among the highest-paid talents at ESPN—but are they drawing more than a million viewers per episode? Not necessarily.

Is PTI’s juice worth the squeeze? Was their lead in a sign of things to come?

Stephen A. Smith is the highest-paid talent at ESPN, having just signed a reported 5-year, $100 million contract. Quick math: that’s about $20 million a year, which is more than Kornheiser and Wilbon combined. Using Colbert as a reference point, if The Late Show cost $100 million annually to produce, Stephen A. Smith’s contract would account for 20% of that cost by itself. Sure, First Take is number one in sports programming during that time slot—but its viewership isn’t anywhere near what The Late Show was doing. Then add in the compensation for the rotating cast of characters like Shannon Sharpe, Chris “Mad Dog” Russo, Molly Qerim, and others. Pretty pricey—averaging around half a million viewers.

Is First Take’s juice worth the squeeze? Maybe this is why Stephen A. Smith is everywhere at all times, to ensure the lemonade still has taste.

ALL Networks Are Playing Catch up for Lost Opportunity

If your program is making more money than you’re spending on it, you’re safe. If not, heed the warning of what happened to The Late Show with Stephen Colbert.

With changing times come changing dynamics—and rising production costs. Talent is not going to magically become cheaper. Nor will the costs to create and distribute content.

While many believe sports content networks have a shield of Teflon from the struggles of network television, the challenges remain the same.

Sports rights agreements are more expensive than ever. Sports networks need those rights as the industry continues to face hurdles from cord-cutting and the fragmentation of live sports. It’s a proven fact that appointment television lives, breathes and survives on live sports play-by-play. Nothing else comes close, and nothing else may ever again.

However, could we see a day where sports networks battle each other for streamers, influencers, and podcasters to fill programming space at a cheaper rate?

It may already be here—for all we know.

Simply put, sports fans can now find entertainment far beyond just the television. The days of appointment viewing for shows like Around the Horn, Get Up, Pardon the Interruption, First Take, and others are over. With the click of a button, sports fans can access a buffet of content options on any app, website, or social network to get the entertainment value they desire. The old way of doing business and generating audience has shifted dramatically, and networks are pivoting their strategies as only they know how.

The eventual fall of late night television was not in the strategy of content direction, it was in the strategy of networks not adapting to changing viewing habits and where audiences are going.

Let’s hope sports networks don’t follow the same formula, before it’s too late.

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John Mamola is the sports editor and columnist for Barrett Media. He brings over two decades of experience (Chicago, Tampa/St Petersburg) in the broadcast industry with expertise in brand management, sales, promotions, producing, imaging, hosting, talent coaching, talent development, web development, social media strategy and design, video production, creative writing, partnership building, communication/networking with a long track record of growth and success.  Honored to be a five-time recognized top 20 program director in a major market via Barrett Media and honored internally multiple times as station/brand of the year (Tampa, FL) and employee of the month (Tampa, FL). Connect with John by email at John@BarrettMedia.com.