why was this show cancelled
Whoever had this show cancelled was an idiot! Just wanted to get this off my chest.
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Agreed.
But to answer your question, there were a couple of things going on. (Based on my memory of it at the time, and articles written later)
The show's ratings weren't stellar. And because it was a half-hour dramedy that wasn't a cookie cutter show, ABC couldn't figure out how to market it.
Then, as the show was starting to build a little momentum, ABC started moving it all over the schedule. Sometimes airing it at different times, different days or just not airing it, so word-of-mouth couldn't help the ratings, because no one knew when to tune in to watch the show. (Personally, I had a couple of cases of talking up the show to friends, and when they went to tune in, the show wasn't on because ABC was messing with the schedule)
ABC decided not to renew the show (I think this was when they decided to air Who Wants to be a Millionaire multiple times a week, so there wasn't room for many scripted shows, and Sports Night was one of the ones that got cut.)
Then HBO was seriously considering picking up the show, but wanted Aaron Sorkin to devote a good amount of time to it. Sorkin was more enamoured of his new show (The West Wing) and didn't want to commit lots of time to Sports Night, so HBO passed on the pick up deal. And that was the end of it.
(Though, I guess HBO didn't totally lose out: when Sports Night was cancelled, Peter Krause was released from his contract, and was then free to get cast in Six Feet Under.)
Interesting that Sorkin was already moving onto The West Wing... That was quick. I could understand if the Sports Night cast felt abandoned by him, given that he wrote or co-wrote almost every episode.
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I can understand that. Actually, now I've finished the show, I see that Sorkin was much less involved in Season 2 and it was as good as, if not better than, Season 1. With that in mind it seems silly that HBO said no based on his lack of involvement. The show clearly worked with less input from Sorkin -- and Joss Whedon has shown it's possible to run three shows at once, on two different networks, with a good writing team. Of course, Sorkin and HBO may not have been interested in doing that.
Another thing I noticed: The show looked unnecessarily expensive to produce. Larry Sanders had a tiny budget and did the same "behind the scenes" thing better than Sports Night (as much as I love the show). And dare I say... it felt more realistic, too? The number of extras in Sports Night (some of whom were given expensive speaking parts just to say, "here's your notes, Dan") seemed unnecessary. In Larry Sanders they shot multiple cameras and did everything (mostly) in 2 takes, with minimal lighting. They also never spent the budget in extras or paying for an extra to speak. Despite these compromises, the show still felt incredibly realistic. Sports Night had a moving, bustling office, with tons of people, but it felt less realistic... so not necessarily money well spent.
Another thing that crossed my mind: I have to wonder if the show could have been continued if it had ended with CSC being bought by a conglomerate that didn't want the cable network. Not only would it have been true to life, and the heart-breaking reality of the show ending, but I think it would have caused a larger outcry from the fans wanting the show to continue. Like maybe in the last scene Issac is shown getting a phone call that ends the show on a cliff-hanger.It worked for Twin Peaks Season 1 :)