I recently spoke to Bill Rasmussen, who launched ESPN back in 1979, giving the world the first 24-hour television network. A life-long entrepreneur and sports fan, Rasmussen’s innovations in advertising, sports and broadcasting are too numerous to list, but they include the creation of SportsCenter, wall-to-wall coverage of NCAA regular-season and “March Madness” college basketball, and coverage of the College World Series. Rasmussen is a frequent guest on radio, television and the internet, and is the author of the best-selling book, Sports Junkies Rejoice! The Birth of ESPN. In 1994, Bill Rasmussen was honored by Sports Illustrated as one of 40 individuals who have had the greatest impact on the world of sports over the past 40 years.
In this interview, Bill talks about how he originally came up with the idea for ESPN, the entrepreneurship lessons he learned from his experience, his big risks, and more.
How did you come up with the idea for ESPN and what were the challenges of turning the idea into a business?
In 1978, I was working as the Communications Director of the New England Whalers of the World Hockey Association, and when the Whalers didn’t make the 1978 WHA playoffs, most of the front office staff – including me – were fired. It was Memorial Day Weekend. I was scheduled to tape a local, Connecticut cable TV show about the Whalers, and I called the producer and said, ‘you may not want to talk to me – I just got fired.’ He suggested I come in anyway, and we talked about an idea I had. Before I was working at the Whalers, I had been on television as a local sports anchor on stations in Connecticut and in Massachusetts, and I had always been frustrated by the amount of time I had on the 11 o’clock news to give the sports results. We only had about three minutes to give the scores and highlights, and even then we were limited in what we could cover – mostly pro sports that were popular where I worked, like the Red Sox, Celtics, Bruins and Patriots. We didn’t get much time to talk about college teams or other teams outside of the area. I never got off the air without getting a call about something I left out. I thought 30 minutes would be enough to report the sports news of the day. At one point I had started a half-hour highlight show that ran one night a week, but that wasn’t enough and the station didn’t support it for too long.
So I talked to my friend about this idea I had, and in a couple of days’ time, we had gathered together a group of Connecticut cable TV owners to see what they thought. It was originally going to be a cable channel focused on Connecticut college sports – we had a lot of college sports that weren’t going to get on NBC, CBS or ABC. Someone suggested we could put it on a satellite – I didn’t know anything about satellites, and as it turned out, neither did anyone else in the room. They suggested I call someone at RCA about getting on their satellite. That would be like someone suggesting today you should call Apple for more information – remember, this was the summer of 1978. I found the one RCA sales rep who must have been sitting by the phone waiting for my call, and the next day, in a conference room I rented from the local cable company for $20, I met with the man from RCA along with my son, Scott. He told us all about what satellite packages were available, including a 24-hour package that no one had ever bought. When Scott went over the pricing structure, he realized the 24-hour package was the best option. Of course, we didn’t have any money, but I called the man from RCA the next day and said, ‘We'll take one of those things.’ ‘One of what things,’ he asked. ‘One of those 24 hour things.’ (We didn't even know they were called transponders at that point). He was surprised and said, ‘you will?!!’ We were extremely fortunate because they had a clause in the contract that said we didn’t have to make the first payment until 90 days after our first use of the satellite!
By July 14, 1978, I had incorporated E.S.P. Network, which of course eventually became ESPN. Now I had to go out and sell the idea to cable television companies – it was a very scattered, regional and local business then – as well as investors, sponsors and partners. We had a satellite – now I needed to pay for it, and I needed to come up with something to show on it!
The next milestone I remember vividly, it was August 16, 1978. It was my daughter Lynn’s 16th birthday, and Scott and I were driving from Connecticut to the Jersey Shore for her Sweet 16 party. I was behind the wheel of a blue Toyota Corolla, Scott was in the passenger seat with a pen in hand and a yellow legal pad on his lap. And the air conditioner was broken. We were in traffic on I-84 in Connecticut, it was sweltering hot, and we had all the windows rolled down. And we were trying to come up with ideas to fill 8,760 hours a year of television programming. We had been talking back and forth for a while, until Scott finally said something like, ‘Play football all day, for all I care.’ And suddenly, the ideas started coming fast and furious during that car ride, we came up with the idea for ‘Sports Center,’ we had designed the entire building we would be in, we had decided what types of sports we should go after. That car ride was where we hung the heavy steel work for the network!
I still needed to raise some money, so I got a $9,000 advance on my credit card, Scott put in some money, my family put in some money, and we started looking for investors. I remember going in to visit Taft Broadcasting, and the head of Taft figuratively patting me on the back and saying not only would our idea not work, but cable was going to be gone in a few years as well. We had met with seven different potential investors and been turned away before Getty Oil said ‘yes’ to the idea in February 1979.
At the same time I was visiting investors, I was trying to persuade the NCAA, the NFL, and others to get involved as partners. Most of the sports and television executives I met with thought I didn't have any idea what I was talking about. We were bombarded with people who told us that to be on 24 hours a day, a single-niche network of sports couldn't sustain itself. It simply wouldn't happen. By January 1979, I got the opportunity to meet with National Collegiate Athletic Association executive director Walter Byers. We talked about the NCAA men's basketball tournament, which at the time was a 32-team event.
NBC had the national TV contract back then, but only aired the Final Four and some regional tournament games, a handful of contests in all. I told Mr. Byers, ‘We want to do every single game you haven't committed to the (major) networks.’ He said, 'Every single one?' I said yes and he said, 'Do you mean to tell me that if Lamar Tech plays Weber State in some regional first-round game, you'd put that on the air?' And I said, 'Absolutely.' And you know what? That next year Lamar Tech played Weber State in the first round. It was the first tournament we did in March of 1980, and I think (Byers) rigged it. I think he wanted to find out if we'd really be there.
What was the biggest risk that the network took early on, and how has it paid off?
When we first went out to meet with the cable systems around the country, we asked them to pay the ridiculously exorbitant $.01 (cents) per day per subscriber -– a cost of $.30 (cents) per month -– triple that of Ted Turner's already established SuperStation WTBS. They practically laughed us out of the meetings. We ended up costing cable systems 2.4 cents per subscriber per month – and when the word started to get out, especially during the 1980 NCAA Basketball tournament, we had cable systems calling us trying to get on board.
Now ESPN charges $5.13 per subscriber per month and has over 100 million households in the U.S. alone – not a bad idea after all. The other risk we took was the decision to be totally ad-based revenue at the start, which was unheard of for a cable network at that time. Again you have to remember that when we went on the air, on September 7, 1979, there was no CNN, no FOX News Channel, no MTV. It was ABC, NBC, CBS, a handful of UHF stations and public television, TBS the Superstation out of Atlanta, and HBO was only on the air for a couple of hours a day. At around the same time the NCAA agreed to let us carry games and Getty Oil came on as an investor, I sold Anheuser Busch on an exclusive advertising deal for $1.38 million.
A salesman once told me that every sale starts with a ‘no.’ We knew we were going to be really be big because we got lots of ‘no’s’ in the beginning. Now there are over six U.S. networks and 46 international networks that have grown from the original ESPN.
How has your network continued to evolve with the changing media (social media)?
Well, I haven’t been on staff at ESPN since 1984, but I continue to be involved, in fact I was there earlier this week for some events related to the 33rd anniversary of our launch, as well as the 50,000th episode of ‘Sports Center.’ And of course, I watch whenever I can, where ever I am, but one of the things that ESPN has always done is to be at the leading edge of innovation, from when I had the idea for getting on satellite in 1978, up to the present day. I’ve met many of the people working in Bristol and New York on the next big thing – there’s always a next big thing – and ESPN will always be evolving, incorporating social media, and other tools and techniques.
When we started ESPN, of course, we were working with typewriters, telecopiers, regular mail – this was long before the Internet, even before FAX machines. HD-TV, 3-D, cell phones, mobile apps -- we didn’t know all that stuff was coming. But basically it’s still the same product, but it’s now delivered over a lot more platforms. ESPN serves the largest demographic, sports fans, on all ‘platforms.’ We didn’t call it that back then! Technology is changing again, with the rise of video programming on the internet threatening the cable companies. But ESPN will continue to hold a leading position on sports programming in the new and coming technology. The company continues to innovate, continues to invest in innovation, and has more than a thousand people on the team devoted to technology.
Since ESPN is at the top, what's next? How do they plan to keep growing and improving on their product?
They'll stay on top because of the underlying culture that has been evident since day one. They want to win and explore every new idea, every new technology, and every new nuance in the industry and most importantly they stay laser-focused on their mission: To serve sports fans. Anytime. Anywhere. Every new idea and every new technology they employ is evaluated with that single-mission in mind. That's the way it's been since 1979 and I am confident that that's the way it will continue as new challenges and challengers appear.
What three pieces of advice would you give to a young aspiring entrepreneur right now?
1. I believe the harder you work the luckier you are. That’s been my mantra forever. Growing up at the end of the Depression and going into World War II, it was instilled in us that we would be positive and do things. I’ve been touring college campuses over the past three years, speaking to student groups, and I encourage budding entrepreneurs to pursue their ideas, even if they don’t understand all the logistics.
2. Don’t ever worry about facts. Whatever it is you choose to do, there’s always somebody you can turn to to answer your question, no matter what it is. You don’t have to know all of the facts before you start, but you better have the passion and the ideas in mind. If you don’t believe, how can you make anyone else believe?
3. I don’t believe that the current economic climate should not be a deterrent to entrepreneurs. I am forever an unabashed American. I grew up thinking we could do anything, and I still think we can.
Dan Schawbel is a Gen Y career expert and the founder of Millennial Branding, a Gen Y research and consulting company. He is also the #1 international bestselling author of Me 2.0: 4 Steps to Building Your Future and was named to the Inc. Magazine 30 Under 30 list in 2010. Subscribe to his Personal Branding Blog for more self-help advice.
