ESPN Bet Is PENN’s Latest Media-Brand Play: Last of Its Kind or One That Could Work?

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Disney will bank the cash. ESPN will feel the pressure. Its journalists will suffer the scrutiny. The media-branded sportsbook concept flickers anew.

Whether gamblers are compelled to patronize ESPN Bet remains to be seen.

All this as PENN Entertainment attempts to resurrect a fading idea in the legal sports betting industry, as it divests itself — for a literal dollar — of a troublesome bro content machine for a legacy media brand it plans to tether to a sportsbook.

Barstool Sportsbook will become ESPN Bet in September. Whether it can succeed where FoxBet couldn’t and SI Sportsbook isn’t will prove someone’s point. If it can come close to the popularity of Sky Bet in the United Kingdom — where that brand is one of the most downloaded sportsbook apps — that would be a top-10 play.

If it validates those who have asserted that bettors don’t care about media company affiliations or those who that say it’ll work with the right kind of juggernaut, like ESPN, this idea is likely buried.

It has a chance to succeed because it is literally the best sports media brand out there. The other examples we have were half-assed and with sub-ideal brands.”

PENN has plowed billions of dollars into making this work. This deal, alone, committed $1.5 billion and $500 million in warrants over 10 years.

“It has a chance to succeed because it is literally the best sports media brand out there. The other examples we have were half-assed and with sub-ideal brands,” online gambling analyst and consultant Dustin Gouker told Gaming Today. “That’s why you could at least see it working. This isn’t SI or Maxim. Those are not great brands (anymore) with brand loyalty or real reach. FoxBet never really fully put the pedal down.”

Disney Reportedly Wanted Far More for Turning Sports Viewers Into Bettors

Disney executives were bullish on their value, with Front Office Sports reporting that ESPN was seeking nearly twice what PENN paid. Ratings have been encouraging even with revenues down across the company, but the sprawling network remains in a trying financial realm. So ESPN made the proverbial bet.

“Thinking about the drivers of revenue for media companies, it’s pretty clear when you have an engaged fan, they’re going to watch longer, they’re going to be more engaged,” said Rick Arpin, managing director of KPMG, a consulting firm with numerous clients in the gambling sector. “That’s going to drive up advertising revenues, and then conversely, for the sports leagues, drives up their media rights.

“But that flywheel effect gets started when fans are able to bet on the sports.”

ESPN Net

PENN Pals With Its Latest, Greatest Media Partner

PENN certainly is a true believer in the premise that media platforms can be more effective and cheaper than buying ads to reach new customers and casual bettors, including those in states that haven’t even legalized sports wagering yet. It bought Toronto-based theScore, a sports content app-turned-sportsbook for $2 billion in 2021, but shuttered its American operation in 2022. theScore still offers bets in Canada.

In February, PENN finalized the purchase of Dave Portnoy’s Barstool Sports empire for $388 million after thinking so-called Stoolies were demographically perfect new customers for Barstool Sportsbook. Incredibly, Barstool was never able to actually prove that a single Stoolie signed up for Barstool Sportsbook. PENN lawyer Jonathan M. Albano made that stunning admission at a Massachusetts Gaming Commission hearing in June over Barstool violations of state gambling regulations.

With PENN CEO Jay Snowden admitting in a Q2 earnings call that Portnoy and his lot were a bad fit, and Portnoy seemingly happy to lose his corporate manacles and regain his empire for $1, PENN pushed hard for its third content creator. The terms of the send-off suggest that PENN was eager to move on from a company that couldn’t deliver this iteration of media-branded sportsbook.

PENN Keeps Defying Industry Trend as Other Media Mash-Ups Melt Away

Granted, this gambling-media marriage is the biggest of the lot, but it still pushes against the headwinds of the US sports betting industry. Flutter Entertainment announced less than a month ago that it would decommission FoxBet by November. MaximBet is long gone, and theScore is back to sports content in the US. Sports media streaming platform DAZN launched DAZN Bet in Germany in August.

“The problem is that we have no example of this working in the US,” Gouker said. “People were heralding the Barstool deal at the time because of its reach, but that reach and ability to acquire customers had a ceiling. ESPN’s ceiling is higher because its audience is orders of magnitude bigger than Barstool, but the big question is how much higher.”

And the question remains whether a company that couldn’t make ESPN World Wide of Sports Grill work for pub food enthusiasts or ESPN Mobile for sports-minded doom scrollers (before that was a thing) is about to launch its net version of Trump Vodka.

“Although sports betting is all the rage right now and growing, there’s still a lot of unknowns out there for people,” Baird Fogel, co-head of the Global Sports Practice at Eversheds Sutherland, told Gaming Today. “They’re not quite sure how to do it, and a lot of the biggest states still don’t allow it. And I’m talking about Texas and Florida, California.

“So you’re talking about a massive amount of people that can’t do this anyway. They’re betting on the come here, to borrow from a gambling reference.”

Fogel surmises that with economic pressures on ESPN, squeezed by rival streaming platforms and YouTube and beset by mass layoffs, the company is leaning into two potential burgeoning areas: growing female sports viewership and legal sports betting blocs, particularly 21-to-35-year-olds.

“They’re trying anything they can and sports betting,” Fogel said of PENN and ESPN. “It makes business sense now. Whether it works — because it hasn’t yet — remains to be seen, but it’s a big gamble for both of them.”

History of US Mobile Sportsbooks: ESPN BET Coming to NY, Replacing WynnBet, Fanatics Grows

Deal Puts ESPN Celebrity Media in Constant State of Scrutiny

ESPN reporters figure to have a tough time as this experiment plays out. The Athletic's Shams Charania perfectly demonstrated the potential conflict before the NBA Draft with a Tweet that skewed betting on the No. 2 overall pick. FanDuel, where Charania is a TV contributor, drastically moved the odds on that pick. Charania was ultimately incorrect, and his purported insider tip made FanDuel money on all those who believed it.

The NBA is a big deal in sports and sports betting, with basketball the most bet-upon sport in the United States at around 35% of national handle.

But the NFL (with far fewer games) is sports-religion, the season around which budgets are built, burnished, or busted, and the golden goose that neither the NFL, NFL fans, NFL rights-holders nor sports betting companies want to see cooked.

ESPN media personality Adam Schefter is a frequent target for his hot-Xs and his hits and misses in NFL reportage. His daily social media feed figures to skew even spicier when a certain percentage of those content consumers -- whether ESPN Bet-tors or not -- assume his inside information is being used to educate the sportsbook's lines. Disney CEO Bob Iger has given assurances there will be a high wall between the content machine and the oddsmakers. But it doesn't matter if potential customers assume otherwise.

Tom Jones, a former NHL beat writer for the Tampa Bay Times and now a senior writer at Poynter Institute, wonders if ESPN would ban reporters from betting as a firewall. He tends to think it won't or "really can" enforce such a mandate.

About the Author
Brant James

Brant James

Senior Writer
Brant James is a senior writer who covers the sports betting industry and legislation at Gaming Today. An alum of the Tampa Bay Times, ESPN.com, espnW, SI.com, and USA Today, he's covered motorsports and the NHL as beats. He also once made a tail-hook landing on an aircraft carrier with Dale Earnhardt Jr. and rode to the top of Mt. Washington with Travis Pastrana. John Tortorella has yelled at him numerous times.

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