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President of ESPN Will Run ABC Sports

The management move signals a power shift as the network division's Howard Katz resigns.

March 04, 2003|Meg James | Times Staff Writer

For decades, ABC Sports epitomized the ascension of televised sports, from the network's pioneering "Wide World of Sports" to its "Monday Night Football."

But in a nod to the changing realities of television, Walt Disney Co. said Monday that the network's sports division now will be run by the president of ESPN, the company's preeminent cable unit.

Disney said it was handing responsibility for ABC Sports to ESPN President George Bodenheimer, who has been with the cable channel for 21 years. The move was announced along with the resignation of ABC Sports President Howard Katz, who declined to comment. In a statement, Disney said that Katz, a 10-year veteran of the company, was leaving to "pursue other interests."

Disney executives dismissed concerns that the company would diminish the stature of ABC Sports by placing it under the direction of ESPN.

For The Record
Los Angeles Times Wednesday March 05, 2003 Home Edition Main News Part A Page 2 National Desk 1 inches; 50 words Type of Material: Correction
TV sports executives -- Captions were transposed on two photos accompanying a Business section article Tuesday on ESPN's president taking over ABC Sports operations. The people misidentified were departing ABC Sports President Howard Katz and ESPN President George Bodenheimer.

"ABC Sports has a 40-year history, and a very elegant history," Bodenheimer said. "It's one of the greatest assets in television sports history.... We're going to obviously seek to maintain and enhance that."

It would be difficult, however, for Disney to consolidate entirely the two divisions because New York-based ABC Sports, with 150 employees, is unionized while ESPN, with a staff of more than 3,200 employees, is not. Complicating matters, Hearst Corp. owns a minority interest in ESPN, which is headquartered in Bristol, Conn.

In many ways, the reorganization formalized a structure already in place. In fact, for a brief time in the late 1990s, ABC Sports did report to ESPN's then-chief executive before control returned to the network.

The advertising sales of ESPN and ABC Sports were merged more than two years ago, with the cable channel handling sales of commercial time for the January Super Bowl, which was televised on ABC.

What's more, the substantial profits generated by ESPN have been propping up the network's sports operations. Cable channels have the benefit of two revenue streams -- one from subscription fees, the other from advertisers. Broadcast networks must rely solely on advertising.

That's one reason General Electric Co.'s NBC, which has no sports cable networks, could not outbid Disney for the latest National Basketball Assn. contract. ESPN is underwriting the $2.4-billion, six-year NBA deal. It was Bodenheimer who created the strategy for the pact.

"It's not surprising that ESPN has become the controlling voice within Disney's sports holdings," said Rick Burton, executive director of the Warsaw Sports Marketing Center at the University of Oregon. "The switch really took place three to five years ago when the power base shifted from the network to Bristol."

The management move comes three months after the death of Roone Arledge, who pioneered the business of sports broadcasting on ABC. Arledge created "Monday Night Football" and "Wide World of Sports" and produced 10 Olympic broadcasts.

ABC Network President Alex Wallau said the change would streamline operations, enhance cross-promotional efforts and be an advantage for Disney when it negotiates rights packages with sports leagues. Said Wallau: "Having one person run the operations instead of two will be more efficient and smarter."

Disney hopes the changes also will give it a financial edge and broad exposure in its bid to broadcast the 2010 Olympics. Media companies are expected to formalize their bids for the Games within the next few months.

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Times staff writer Sallie Hofmeister contributed to this report.

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