Richard Deitsch and Andrew Marchand are sports media writers for The Athletic. They converse every couple of weeks on sports media topics. This week, they discuss Marchand’s scoop that Stephen A. Smith has agreed to a new contract with ESPN worth at least $100 million for five years, an agreement that will result in Smith continuing to star on “First Take” on ESPN while scaling back some of his other required appearances on the network, which would free him up to talk even more about politics.
Deitsch: I will never forget what a prominent talent agent told me long ago about ESPN. This was someone who negotiated many deals with management. The agent said, “You have to f— ESPN before they f— you because they will f— you.”
I was thinking about this quote when I saw your intrepid reporting about ESPN re-signing Stephen A. Smith to a $100 million deal. I think it would be valuable to readers for you to offer a quick primer on why the money here is so large and how ESPN sees a possible ROI (return on investment). Because I imagine a lot of readers are stunned by the numbers.
Marchand: There is an argument that no one in sports media should make $20 million per year, but if anyone should, Stephen A. is at the top of the list. It doesn’t matter if you like him or not or think his opinions are good or not, the product of First Take is mostly Stephen A. Not games or pregames, it is about him leading as an entertainer.
The show brings in tens of millions of dollars per year. If you let Stephen A. go, is there a replacement and how much would that person cost? Shannon Sharpe would be the answer at the moment. According to sources, Sharpe makes $6.5 million per year from ESPN for two days of First Take a week. If he had replaced Smith full-time, he would at least want to double that. After Sharpe, there is no one else who is an obvious replacement.
Plus, even though Smith’s recent go at politics might create an eventual headache, I respect his work ethic, and he has been committed to the network. The funny thing about his recent turn is that when the network was perceived to be the most political, during Donald Trump’s first presidential term, Stephen A. mostly stayed out of it, following what Disney wanted.
Deitsch: Whether it’s Stephen A. Smith or an NBC Sports intern, I think everyone owes it to themselves to get as much as they can, especially given the instability of the broader sports media industry. I’m not convinced — or less convinced than you — that First Take would drop off significantly as far as a revenue driver with different talent. I think the show would make nearly as much money with Sharpe and some other person across the way.
But ESPN chairman Jimmy Pitaro and ESPN president of content Burke Magnus have designated who the company’s front-facing stars are — and Smith is at the top of the list. This brings me to an adjacent topic — how this plays internally. Both of us have talked to hundreds of ESPN people over the years. Sometimes, no one blinks at these big salaries, and other times, it has people questioning if they are being valued fairly. How do you think this news plays at ESPN and also the industry writ large?
Marchand: Jealousy is a real thing. Especially when Stephen A.’s top topic is … Stephen A. When folks have to fight for an extra $10,000 on a new contract, it eats at them. However, Smith’s job is a lot different than most on-air people or writers. He is a personality, which is where the most money usually lands. Talk show hosts traditionally make the biggest salaries because they are not journalists but rather entertainers.
Smith is in the attention business. He probably receives the most attention of anyone in sports media. And he has been largely a team guy. But Pitaro’s and Magnus’ jobs are not to be liked, but to do the right thing for the company. Some of these sports media salaries are so crazy that it could be argued that none of these folks should make these numbers. Quite frankly — to borrow a Stephen A., oldie but goodie — if someone wants to be paid like Stephen A., do the work that garners the same amount of attention.
Deitsch: Let’s end on this: There are always contracts coming up in the sports media, and that is why most large outlets have talent departments. My read on this is that Smith won’t change the market as far as impacting others at ESPN or elsewhere. The high-end talent, from Tom Brady to Pat McAfee to Smith, will continue to see astronomical money. But that’s a small group. I see sports media entities continuing to downscale for both front-facing and non-front-facing people. The business will get younger and leaner. How do you see it?
Marchand: In a splintered, increasingly more digital sports media, the game changers with content deemed unique will stand out. But if I were ESPN, I’d pay attention to the middle class. Having quality throughout your system and having a true, strong farm system paired with the stars is the best way to win. ESPN should not forget that because it needs to decide what its brand means. Yes, it’s Stephen A., but a team can’t win a championship alone.
(Photo: Paras Griffin / Getty Images)
