On Tuesday, New York Yankees announcer Michael Kay received some concerning news. Reports indicate that ESPN New York will be relinquishing its 98.7 FM signal effective August 31, 2024, as they shift their focus towards digital distribution and prioritize the use of 1050 AM for their premium programming.
As a result of this change by ESPN, “The Michael Kay Show” is slated to make its move to 1050 AM, sharing the platform with broadcasts of New York Jets, Knicks, and Rangers games.
This strategic shift in broadcasting stems from a shift in the business model of Good Karma Brands, the company overseeing ESPN New York. They no longer perceive the high cost of an FM signal as justifiable.
The reason behind ESPN’s move
Recent assessments have revealed that a significant portion, 60%, of their audience comes from individuals who tune in through digital means, rather than traditional radio. Of the remaining 40% within radio range, it is anticipated that eight out of every ten listeners will easily find the station on the AM frequency.
This decision will provide WFAN, which utilizes signals on both 101.9 FM and 660 AM, with a distinct advantage in what has evolved into a prominent ratings competition, reminiscent of the classic showdown between FAN’s Mike Francesa and Michael Kay in their prime.
Craig Karmazin, the CEO and founder of Good Karma Brands, explained that their commitment was directed toward serving the New York sports fan. He mentioned that, considering the AM signal, the ESPN New York App, podcasts, smart speakers, YES, and various other audio and video distribution channels, the importance of investing in an FM signal had diminished compared to a decade ago.
The decision was made by Good Karma Brands and is unrelated to recent cutbacks at ESPN.
ESPN’s 98.7 FM story
Over a decade ago, ESPN, the flagship network, entered into a lease agreement with Emmis Broadcasting for the 98.7 FM signal. According to sources, ESPN paid more than $10 million annually for this lease. At that time, ESPN was solely broadcasting on 1050 AM, which was originally the signal for WFAN and owned by Jeff Smulyan of Emmis Broadcasting.
Sources now indicate that the current lease rate stands at approximately $12.5 million per year.
As the lease with ESPN New York concludes on August 31, Emmis has the option to either sell or lease the signal to another entity. If they opt to sell it outright, sources suggest that Emmis is seeking offers in the ballpark of $50 million.
Michael Kay embarked on his broadcasting career in 1982 with the New York Post, initially focusing on basketball, including college and the NBA. In 1987, he was assigned to cover the New York Yankees, a role he began in 1989. From 1992 to 1999, Kay served as MSG’s locker room reporter for the New York Knicks. Simultaneously, he was engaged in radio broadcasts of Yankees games alongside John Sterling. In 2002, Kay transitioned to the YES Network, while Sterling continued with radio broadcasts.
Regarding the MSG contract for the Knicks and Rangers, it appears that provisions were made to address the situation of ESPN New York no longer holding the lease on 98.7 FM. However, there may be some potential issues to resolve with the Jets’ contract, which predates this development. The Jets could explore the option of negotiating broadcasting rights with Audacy or iHeart stations that have FM signals.
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