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Tuesday, August 28, 2012

Disney's 5.6 Billion Dollar Gamble

5.6 billion dollars.  It’s hard to wrap your head around a figure that large.  You could arguably build one major new theme park for that about of money but that isn’t what Disney is doing with it.

ESPN extended its contract for Major League Baseball through the 2021 season for 5.6 Billion Dollars.  That’s by no means a safe bet. 

Baseball isn’t what it was in the 90’s when ESPN first signed on to televise baseball.  Back then baseball was still arguably the most popular sport in the US.  Today many kids are looking to other sports.  That’s an important fact when you are making an investment that covers a vast majority of the next ten years.

Granted ESPN has been one of the most reliable of Disney’s holdings over the last ten years.  It’s consistently grown and has been a money maker.  You’d have to believe that they would have done their homework and have a decent idea as to how much of a draw baseball will have over the next few years.  Still it’s a massive investment that may or may not pan out.

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