What the ESPN Layoffs Really Mean

In the last couple of weeks, cable television sports giant ESPN has been handing out a lot of pink slips. Familiar names such as NBA analyst Jeff Van Gundy (17 years), longtime SportsCenter host and NFL analyst Suzy Kolber (27 years), former NFL quarterback Steve Young (22 years), and former NBA player Jalen Rose (16 years) were among the better known talents being permanently sent to the dugout by ESPN. This summer’s job reductions at the worldwide leader in sports have sent a number of familiar sports names to Bristol, Connecticut’s unemployment office. Here is ESPN’s official statement from June 30: “Given the current environment, ESPN has determined it necessary to identify some additional cost savings in the area of public-facing commentator salaries, and that process has begun,” the sports network said in a recent statement. “This exercise will include a small group of job cuts in the short-term and an ongoing focus on managing costs when we negotiate individual contract renewals in the months ahead. This is an extremely challenging process, involving individuals who have had tremendous impact on our company. These difficult decisions, based more on overall efficiency than merit, will help us meet our financial targets and ensure future growth.”  Let’s break down that statement and take a closer look at what has been going on at ESPN. Cost Savings: When profits drop, a company will need to cut its overhead costs if they don’t expect a rebound anytime soon.  The personnel recently let go by ESPN were deemed as weighing down the corporate overhead and not contributing enough to help increase the company’s profitability. For example, ESPN’s NBA announcer crew has been comprised of three people for many years.  Play-by-play man Mike Breen along with former NBA player and current analyst Mark Jackson teamed with former NBA coach Jeff Van Gundy on the telecasts. In this recent layoff, Van Gundy was deemed expendable.  That means that the company felt that his salary didn’t translate into enough viewer loyalty to justify his pay. For those of us old enough to remember Monday Night Football, the opinionated journalist named Howard Cosell became a discussion item around the coffee pot every Tuesday morning following the Monday night games. His weekly jousts with former NFL quarterback Don Meredith became a must-see part of the show.  Their generally-friendly battles helped to attract millions of non-conventional football viewers. In the case of basketball analyst Jeff Van Gundy, ESPN apparently felt that its NBA basketball ratings would not be hurt by the loss of his commentary on the broadcasts begin