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The Walt Disney Company has determined its parent brand is not impacted negatively by embracing sports betting on ESPN, Bob Chapek, CEO of the entertainment giant, said this week.
Speaking to shareholders on an earnings call, Chapek said Disney has “to seriously consider getting into gambling in a bigger and bigger way and ESPN’s the perfect platform for this,” per NextTV.com.
According to The Wall Street Journal, ESPN has conducted talks with at least two sportsbooks to license its brand, including Caesars Entertainment and DraftKings. ESPN is seeking a $3 billion licensing fee for such a venture, according to the report.
While ESPN, like several media companies, has expanded sports betting content across broadcast and digital platforms through partnerships with sportsbooks, licensing its brand to a sportsbook would mark a new frontier.
The reported negotiations over brand rights indicate Disney feels ESPN is a sort of “golden goose” in the market. With an established brand and multiple television, radio, and streaming networks with thousands of sports events covered each year, ESPN can bring a large audience to a sportsbook relationship.
An influx of cash from a licensing deal would help ESPN, which has suffered as much as any network as younger audiences change their viewing habits. According to Sportico, TV viewership has declined by 22 percent since 2017. Pew reported that 1.5 million cable subscribers cut the cord in the first quarter of 2021.
Disney Seeks Revenue Gains In Wake of Pandemic, Layoffs
Since he was named CEO in February of 2020, Chapek has overseen several big moves by Disney, including the launch of 20th Television Animation, which will produce adult animation. That decision was curious to some observers, who wondered if Disney would endanger its “family-friendly” brand by entering into more sophisticated and adult themes.
Revenues are down or flat for Disney since the first quarter of 2020, hindered by the pandemic and travel restrictions, as well as a mixed response to content the company has produced for its streaming platform, Disney+. While content for flagship franchises like Star Wars and Marvel have been received well, other content efforts were curtailed by production delays.
In the last 15 months, Disney has laid off more than 32,000 employees. Per Chapek’s comments, sports betting is a potential new revenue stream.
“[Gambling] actually strengthens the broad of ESPN when you have a betting component and it has no impact on the Disney brand,” Chapek said.
