Channeling Sports: A Conversation with ESPN Founder Bill Rasmussen

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When Bill Rasmussen launched ESPN on September 7, 1979, he gave the world its first 24-hour television network and changed the way people viewed both television and sports. A life-long entrepreneur and sports fan, Rasmussen’s innovations include the creation of the daily sports news television show “Sports Center,” wall-to-wall coverage of NCAA regular-season and March Madness college basketball, and coverage of the College World Series baseball tournament. Two years ago, he authored a book titled, Sports Junkies Rejoice! The Birth of ESPN. Rasmussen recently talked with Knowledge@Wharton about the challenges of founding a 24/7 sports network in the face of nearly universal skepticism, what entrepreneurs need to succeed and why he doesn’t ever plan to retire.

An edited transcript of the conversation follows.

Knowledge@Wharton: We are pleased to have Bill Rasmussen, the creator and founder of ESPN, here to speak with us.

Bill Rasmussen: Thank you. I’m looking forward to it.

Knowledge@Wharton: When you created and launched ESPN, what was your vision at the time, and how close is that vision to what we see today?

Rasmussen: I had this feeling that people were really interested in sports because I was. If I’m interested in it, everybody must be, right? But it turns out that was the case. We had enough evidence that people were interested in sports, and we thought sports 24-hours-a-day addresses a lot of [what] I thought the networks were missing.

In the 1970s, television was New York-centric. They had the news go on at 11 p.m. because they figured everybody would go to bed [after that]. Those who stayed up late could watch the late show. But still, at 1 a.m. in the morning, we signed off. I was working at a local NBC station, and at one in the morning we would say, “You’ve been watching, thank you very much and here’s the national anthem and so on.” But there are a lot of people who work different shifts. They work from 11 to seven. Some people work overnight. Some people work from the middle of the afternoon and they miss all of the things like movies and news and the other good things that people would enjoy, and sports.

In the late 1970s, the three big networks, ABC, CBS and NBC, only did about 25 football games a year. Can you imagine life with only 25 football games televised in a year? We said, “Well, we’re going to do them all the time. We can just do more football than anybody.” As an aside, I raised that question a year ago when I was up at ESPN for one of their anniversaries and reminded them that when we started, that’s what the networks were doing. George Bodenheimer, the president, looked over and nodded at somebody because he knew I was going to [ask] how many they are doing today. That particular year, 2010, they were doing 417 college football games on ESPN alone.

We started off to be a sports source no matter what time of the day anybody wanted to tune in, whether it was for a game or news, sports scores, whatever. The idea was that if you came home at three in the morning and if you had just been out with your neighbors for dinner at 7:30 and didn’t want to watch whatever the networks were offering, you could come and find some sports. And so Sports Center, of course, filled a great need. There have been more editions of Sports Center than any other show in the history of television. People must like the idea. From then to now I don’t think it’s changed really very much at all. What has changed is the technology to deliver the same message that we came up with then, and that is sports, sports and more sports.

Knowledge@Wharton: That was one of those questions that I remember you got [early on]: “Who’s going to watch sports 24/7?”

Rasmussen: It’s just amazing. 24/7. That’s 8,760 hours a year. That’s a lot of sports, especially when the big three networks combined were only doing 1,300 hours back in those days. But then when talk came up of a second ESPN, [some people said], “Oh, now that’s way too much saturation. Now seriously, nobody’s going to watch. How many people are going to watch?” Well, today ESPN alone, not counting all of the other people who do sports, has 52 networks around the world, 24/7. People must like sports.

Knowledge@Wharton: So take me back to the late 1970s. With the media landscape the way it was — there was no 24/7 network at all — what made you think that this could be successful? [How could you] compete against the sports network behemoths?

Rasmussen: The big guys basically dominated television for 28 years. Television sets in those days, and it’s hard for a lot of folks to remember this, only had 12 channels. That’s all you could get. There was no set top box that could magically bring other things from around the world. And because of the FCC regulations of the day, many of those 12 channels were occupied by the big three networks because if any of their signal touched a franchise area, the franchise had to carry it. So it was not uncommon to see two ABCs, three NBCs and two CBS stations. I mean you could just go up and down the dial. So that only left five channels for everybody else. Basically cable television in that era was really nothing more than signal enhancement — taking a signal that they could get at a tower someplace and sending it off to people who couldn’t get a good picture of the three big major networks.

Fortunately for us, the powers that be at the major networks decided that this was it. They had conquered the world, and nothing was ever going to change. Their dominance was there, and it was going to be that way forever. Well, as you and I know, nothing’s forever. Things change. We challenged them. They felt we were crazy. They all said it wouldn’t work. “Who’s going to watch?” Suddenly we found that we were tapping into what I felt then, and obviously has been confirmed over the years, to be the biggest demographic swath you could imagine. It’s not men 25 to 34. It’s not women of a certain age or kids. Our demographic was sports fans. At ESPN to this day, on the back of their card, their mission statement is to serve the fan. So we had a demographic area that [included] north, south, east, west, young, old, male, female, rich, poor, whatever…. If you think about it, that is about the biggest demographic you can find other than being an American, for example. We’re all Americans. Okay, but probably some 90% of us also have a team we root for, and that’s the market that we went after.

Knowledge@Wharton: You were talking about the big three networks back in the 1990s. Why is it that we could not find ESPN in the TV Guide in the early days?

Rasmussen: Because of the development of the network industry, the big three basically controlled TV Guide and Nielson. We couldn’t get Nielson to rate programs, either. They would not go out and audit for viewership until well into the 1980s. We kept after TV Guide, and kept after them and after them [until] the vice president said, “We won’t list you because real networks only have three letters.” How’s that for kind of a jaded view of the world? In other words, the people who are paying our bills are the only ones that count, and they all have three letters. When they finally did list us, they in fact listed us as ESN. They made us a three-letter network for a short while, but of course that turned into ESPN eventually.

Knowledge@Wharton: They finally woke up and smelled the coffee.

Rasmussen: Exactly.

Knowledge@Wharton: ESPN was not your first entrepreneurial venture and has not been your last. What does it take to give an entrepreneurial opportunity the best chance to succeed?

Rasmussen: First of all, being in our country is great. We don’t have to go and ask permission to develop a new idea. My first one was back in 1959. If you’re curious and you ask enough questions, you’ll say, “Wow, nobody’s doing that. How about let’s try this.” The problem with “Let’s try this” is sometimes it doesn’t work. Most times, it doesn’t work.

But if someone wants to be an entrepreneur and they’re not curious and not passionate about what they want to do, they’re not going to succeed. I’ve been curious my entire life, asking questions [about] why doesn’t this work and how does that work and why can’t we do this. The first company was an advertising service company. And [you also need] passion. If an entrepreneur says, “Gee, I’ve got an idea. I think it’s going to work. I think I’ll go ask someone. I’m going to see if Derek would like to invest in my idea.” And then I say, “Derek, well, I think this might work,” you’re probably not going to be too enthused. But if I come to you and say, “Derek, this is just — this idea, I can’t tell you how it’s going to explode upon the landscape.” You might say I’m overreacting a little bit, but you’ll also see I’m pretty passionate about it. So you might say, “I think we’re going to take a ride with this one and see what happens.” All of the sudden we have a success.

I think the culture in which we live let’s that happen. It fertilizes good ideas. Just come up with an idea. Go try it. You don’t have to know everything there is to know about that topic. You don’t have to know any of the facts really. You can find somebody who knows. I don’t know how television pictures fly through the air, but I’ve been fairly successful in television. I don’t have to know all that technical stuff. You just have to have the vision and the passion.

Knowledge@Wharton: I continue to hear this theme of passion from you. And speaking of passion, ESPN is now seen essentially all over the world. So when you look back, 30 plus years after you created this baby, how does it feel to you personally to have created something that is consumed around the world and is part of people’s daily lives?

Rasmussen: That’s an interesting question, and it had never been asked until just recently. I really don’t think about it. Obviously I’m proud of it. It’s been kind of like watching your kids grow up to be successful lawyers, doctors, pollsters (in the case of one of my sons), but it’s amazing. Everywhere I go I see it. You see it in the hotels, you see it in the restaurants, you see it everywhere. People get all excited. They’re talking about ESPN, and I just sit and have my hamburger and don’t say anything. Sometimes I think about, gee, they wouldn’t be here if it wasn’t for that. But I’m not overwhelmed; I’m just kind of incredulous. But I haven’t been there every step of the way.

It was an idea. It’s kind of like asking Edison when he walked into a place with a lot of light bulbs, “What do you think when you look around here and you’re the guy who invented the light bulb?” I don’t know what he would say. And so I don’t really know what to say. But I am proud of it.

Knowledge@Wharton: I was watching ESPN last week, as I do every day, and there was a press conference with Peyton Manning to announce that he was no longer going to be part of the Indianapolis Colts organization. A reporter asked him, “Why are you still going to continue to play? Do you feel that you have something to prove?” Peyton’s response was something to the effect of, “Well, I still like to play. And no, I don’t have anything to prove.” So you’re still an entrepreneur. You’re still involved in new ventures. Why don’t you just retire?

Rasmussen: I tried it once. Retirement’s not much fun. I played golf every day for 21 days and was bored silly. Within a month, I had another company going.

I think if you stop exercising your brain and you stop doing what you’ve been doing along life’s road, you’re probably going to — I don’t know whether you’ll just die instantly. But I’m just curious. I suspect I’m going to be curious about things until I do die. I’m fascinated, and I love to see young, enthusiastic men and women getting involved in whatever it is. One of the things that I enjoy is speaking to groups, like the one [I just met with] at Wharton. Meeting the young men and women, [seeing] their enthusiasm, is inspiring to me. So I guess I’ll just keep on doing it. I can’t really tell you why.

Knowledge@Wharton: I’ve taken you forward; now I’m going to take you back to your early days in high school. Were you passionate about sports as a youth, and what led to your passion?

Rasmussen: Long before high school, even in grade school, I was passionate about sports. I could really run. For some reason, I was fast. I don’t look so fast these days, but I was in those days. When the eighth grade team asked me as a fifth grader to play left field because I could run and catch — I had an aptitude for baseball and softball in those days — I was really excited about that. I used to follow the White Sox and the Cubs. My grandfather saw every game of the 1906 Chicago World Series, White Sox and Cubs, the only time they ever played [each other]. He indoctrinated me early on about baseball. I saw Bob Feller pitch on opening day in 1940, and those were exciting things. I was into sports early in grade school, and by the time I got to high school it had long since been a passion. I could tell you about major league rosters and why the Cubs were hated and [why] the White Sox — I lived on the south side of Chicago — were the team of choice.

By the time I was in the third or fourth grade, I was reciting statistics and so on. Luke Appling batted 388 in 1936 and won the title. You probably didn’t realize that, a batting title in the American League. But things like that, they stick. I don’t know why.

But in high school I got to play baseball and just really, really enjoyed it. We played summer leagues and fall leagues. Any time that we weren’t in school, we were playing, right through American Legion and everything. I think people who were involved with sports were very, very active, alive, and they all went on to do great things — not necessarily like ESPN. That even still boggles my mind, as you know, but I think sports spawns competitiveness and makes people want to do things a little bit better. In some cases a lot better. They make it all the way to the major leagues.

Knowledge@Wharton: We’re talking about how you started with your passion in sports as a player, as a participant. Between that time and when you founded ESPN, you were involved in sports from a business perspective. How is it that you became involved in the business of sports?

Rasmussen: I wanted to play baseball, and I had an opportunity at the end of high school. But the very day we graduated, the North Koreans went across the 37th parallel and created a situation where anybody with a college deferment should take that deferment or they would be going into the Army. I wanted to play baseball. I went to college, played some more. Went to the Air Force when I got out, played some more. And by the time I got out of the Air Force, age had started to catch up with [me]. The fact that curve balls are tough enough to hit when you’re young became a factor.

So I said, “Well, I want to be a broadcaster.” I couldn’t do that instantly because in the mid 1950s, radio and television weren’t very much. Each team had its own radio station. New York had three stations, one each with the Giants, Yankees and Brooklyn Dodgers. So there was no opportunity there. I said, “Well, we’ll do something — I’m going to do something in sports before this life passes me by.” On my 30th birthday, I retired from the first company. Retired is a bad word. I just left the first company by agreement with enough money to pursue a broadcasting career. That was one of my first brash steps into the broadcasting business.

I looked in Broadcasting Magazine. They had these little classified ads, station needs sportscaster, call such and such, or newscaster, whatever it was. I found one nearby in Westerly, Rhode Island, and the guy said, “Sure, come on up.” He was looking for a sports director for a new station.

So I went up, and he said, “Well, tell me what station you’ve been at.” I said, “I haven’t.” He said, “Well, what about your background in radio?” I said, “I have none.” He said, “Then what makes you think you can be a sportscaster, and why should I hire you?” And I said, “Because I can [do it], and I’ll be a really, really good one for you.” He said, “You know what, I’m going to hire you.” I started in radio, and that led, within about 15 or 18 months, to television and on and on. One thing led to another, and we did radio networks and a lot of TV broadcasting and then hockey broadcasting. Each step along the way, I was doing independent little networks, trying to figure out how it worked. I didn’t realize that this wasn’t what everybody did. Just seemed it had to be done, so I went and did it.

Knowledge@Wharton: These days, there’s not a lot of mixing between on air personality and suits, the executives behind the business.

Rasmussen: Exactly.

Knowledge@Wharton: But you made a transition, and not a small transition, from on camera or on air to founding a pretty sizable and successful business. What’s the secret to being able to make that type of transition?

Rasmussen: That’s a good question. It just seemed very natural to me. But people say: “Why did you do that or how?” I don’t know how I did it. I was a broadcaster, and I wanted to put a network together that would get the message out to more people than I could do at a local station. The best way to do it is to go hook up some more stations. So I had to figure out how you do that. By the time I was fired from my job at the Whalers, I knew about phone lines and local connections and AT&T and all that. At the same time, RCA Americom had developed and launched the first communications satellite. Not very many people knew about it, and we just almost fell into the idea that we could do something across all of North America with one signal to one point and not have to go through all this television-long-lines business with AT&T.

Back in the 1960s when I was starting in radio and broadcasting and putting networks together, I had learned all that stuff about AT&T. So here was something else to learn — the satellite business. I didn’t even know you called them transponders when we started talking about it, but it doesn’t make any difference as long as you know what it is. It sounds like you’re going to be embarrassed talking about something you don’t know anything about, but you have to ask the questions. And when you’re passionate and they’re telling you, “Yeah, you can do this,” “Okay, we’ll do it,” “Oh, by the way, it’s going to cost a little money,” [then you] just figure that out later. That’s just the way it’s been all my life. I guess I should start to slow down, but I don’t know, it’s too much fun.

Knowledge@Wharton: Going back to your passions, what is your favorite sport and why?

Rasmussen: Baseball, only because I played it forever. ESPN has a great show, Baseball Tonight. Peter Gammons, whom I’ve known for 40 years, does a great job. He has for 40 years, first on the newspaper in the Boston area and now on ESPN.

Knowledge@Wharton: Let’s talk about mentors. Have you had any real mentors in your career, and is there any particular advice that they have given you?

Rasmussen: Back in my undergraduate days, there were a couple of professors who were unique and stood out. Oddly enough, one of them was an American history professor. It was his passion for the Civil War, believe it or not, that led him once a year to hold a two-night class, for want of a better word, where he would do the battle of Gettysburg on two huge relief tables. I mean everything in proper relief and to scale. These tables were 14 to 15 feet long, and he would walk around, his white hair flowing, and you could see his passion oozing everywhere. He knew everything there was to know about it. He had to [hold the class] for two nights because everybody wanted to hear him. This is a history professor. He was just absolutely inspiring.

The other one was a financial organization and investment economics professor. How’s that for an inspiration? He had the same kind of passion. In those days, we didn’t have computers and laptops and all those things. We didn’t have white boards and grease pencils and so on. We had old fashioned blackboards and chalk. He would start by the windows on the blackboard , and he would be going along and he’d ask questions over his shoulder. If he didn’t hear an answer from someone that he had asked [a question to], he would say, “Derek, what about –.” He’s writing and talking, and if you didn’t answer, he would turn around and fire one of those felt erasers. He would hit kids in the shoulder, in the forehead and so on. “Pay attention. Pay attention.” So if this guy is this passionate about numbers and economics, then there must be something to this business of business. I don’t know if you would call these two guys “mentors,” but they were two professors who made monstrous impressions.

Knowledge@Wharton: What’s your advice for young people who may be considering a career in sports broadcasting or, more generally, in the business of sports?

Rasmussen: First of all, sports has to be a passion or they wouldn’t even be thinking about that, whether it’s just they’re curious about being a television producer or an announcer or a lawyer at one of the major networks or whatever it might be. But I think what they have to do is understand, and the best way to understand how sports begins is it doesn’t hurt to start small. Go and be a production assistant someplace. Go to a small radio station and learn all you can learn. Ask all the questions you can ask. And when somebody’s kind of brushing you off and saying, “Yeah, don’t bother me, kid,” just say “Well, I don’t mean to bother you. I really want to know. I have a passion to learn this business, and I want to be doing what you’re doing.” Or I want to do, fill in the blank, whatever they might want to do. And carry that passion into every interview.

And be prepared. If you’re going to ESPN, you don’t want to talk about things that the Cooking Channel has been doing. I’m not putting down the Cooking Channel. If you’re going to the Cooking Channel, you don’t want to be a sports fan. You better know what you’re talking about there. But I’ve just always believed in paying attention, learning as much as you can beforehand. All the facts are not necessary. You’ll learn the facts; you’ll learn the specifics of the business. But whoever it is that you’re applying to has to see the passion, see the desire to be successful. I’m fortunate in that I see a lot of that. You just know they’re going to be successful kids, folks here at Wharton and schools across the country. And then you see others who, you know, they don’t even want to walk across the street unless it’s required. I don’t mean to be putting anybody down, but the people with the passion, the people who ask the questions, the people who are willing and anxious, I guess would be a better word, anxious to learn all there is, they’re the ones who are going to succeed.

What’s amazing [is that] you can pick almost any field and if the youngster has that passion, [he or she] can learn anything. It doesn’t have to be sports. It can be Wall Street. It can be the Cooking Channel. It can be anything. Passion, enthusiasm and never be afraid to ask questions.

Knowledge@Wharton: That is a great note for us to finish up on. On behalf of the Wharton School and the Wharton Sports Business Initiative, thank you so much, Bill.

Rasmussen: Thank you Derek. I enjoyed it very much.

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