Fox Sports 1 Aims at ESPN’s $10 Billion Annual Revenue

By Douglas A. McIntyre Updated Aug 19, 7:08AM EDT · Published Aug 18, 7:47AM EDT

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If an analysis of ESPN’s issued by Wunderlich Securities and published by The Atlantic is correct, the huge sports network has revenue of between $10 billion and $11 billion a year. No wonder Twenty-First Century Fox Inc. (NASDAQ: FOX) want to built a 24-hour sports channel on its own. No one can be certain what it will cost to make Fox Sports 1 a success, but it has to be an investment by the parent of well into the billions of dollars.

The first day’s programming at Fox Sports 1 had little that was distinctive. The show that headline promotions include, “Crowd Goes Wild,” is the kind of fixed-set show with several talking heads that ESPN launched and perfected long ago. The balance of the promos were for coverage of NASCAR and UFC. “Mike Tyson On Fox Sports 1” might be a winner, if he is as volatile has he was as a fighter.

Fox should be happy that most of the criticism of the network was positive, and negative press was light. Perhaps the harshest view was from Deadspin and was about hockey, a sport that never did well in the ratings:

Despite claims to the contrary and hiring two of Canada’s most beloved sports personalities, today’s launch of Fox Sports 1 doesn’t bring glad tidings of coverage for North America’s most-ignored major sport.

Sure, it’s the NHL offseason. But take a look at what sports for which FS1’s Fox Sports Live website does offer coverage. NCAA basketball, Olympics, and even horse racing make appearances. Hockey does not. We have to imagine this will get fixed soon, but really?

The Fox decision is smart. The NHL players are always on strike.

But comments on programs from the first day are petty and meaningless. ESPN gets most of its income from fees paid by cable networks. Fox Sports 1 has to clear the hurdle that cable companies are willing to pay for ESPN 1, ESPN 2, ESPN 3 and an armada of other channels. Beyond that, the ESPN has been big on Web and in print for years.

The first day of programming for any channel probably has no value in predicting the future. If so, Fox Sports 1 still has a chance.

About the Author Douglas A. McIntyre →

Douglas A. McIntyre is the co-founder, chief executive officer and editor in chief of 24/7 Wall St. and 24/7 Tempo. He has held these jobs since 2006.

McIntyre has written thousands of articles for 24/7 Wall St. He is an expert on corporate finance, the automotive industry, media companies and international finance. He has edited articles on national demographics, sports, personal income and travel.

His work has been quoted or mentioned in The New York Times, The Wall Street Journal, Los Angeles Times, The Washington Post, NBC News, Time, The New Yorker, HuffPost USA Today, Business Insider, Yahoo, AOL, MarketWatch, The Atlantic, Bloomberg, New York Post, Chicago Tribune, Forbes, The Guardian and many other major publications. McIntyre has been a guest on CNBC, the BBC and television and radio stations across the country.

A magna cum laude graduate of Harvard College, McIntyre also was president of The Harvard Advocate. Founded in 1866, the Advocate is the oldest college publication in the United States.

TheStreet.com, Comps.com and Edgar Online are some of the public companies for which McIntyre served on the board of directors. He was a Vicinity Corporation board member when the company was sold to Microsoft in 2002. He served on the audit committees of some of these companies.

McIntyre has been the CEO of FutureSource, a provider of trading terminals and news to commodities and futures traders. He was president of Switchboard, the online phone directory company. He served as chairman and CEO of On2 Technologies, the video compression company that provided video compression software for Adobe’s Flash. Google bought On2 in 2009.