ESPN Gets the Green Light on Sports Betting From Parent Company
Earlier this year, there were rumors that ESPN was actively pursuing a deal with one of the bigger US sports betting operators for branding rights. Nothing concrete came from those talks, but they always say where there is smoke, there is fire.
One of the biggest concerns had to do with ESPN’s parent company, Walt Disney. As the ultimate family entertainment company, Disney has been vocal against the expansion of gambling in the past. However, that stance had more to do with the company’s vast business interests in the state of Florida.
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More recently, the stance on legal gaming has softened. A few weeks back, Disney CEO Bob Chapek held a conference call with investors. He described sports betting as a major “opportunity for the company.”
He also admitted some concern on the impact this industry would have on the Disney brand. However, internal research has determined that a move into legal sports betting would not injure the image of the Disney brand. Chapek cited the shift in attitude towards sports betting in the US market.
Disney has an 80% ownership stake in ESPN as a major source of revenue. Chapek also believes that by adding a betting component to the mix, it would actually strengthen the ESPN brand.
There are numerous examples of strategic partnerships between US sportsbook operators and media properties that have mutually benefitted both parties.
Penn National Gaming and Barstool Sports is a prime example. As a result of their partnership, the Barstool Sportsbook mobile betting app has become extremely popular in every market where it is available for download.
Chapek made the following comments in reference to sports betting and ESPN:
“It’s driven by the consumer, particularly the younger consumer that will replenish the sports fans over time and their desire to have gambling as part of their sports experience. As we follow the consumer…we have to seriously consider getting into gambling in a bigger way.”
The company’s streaming bundle includes Hulu, Disney+ and ESPN+. Going back over the last year, sports accounted for 90% of the actual viewership.
Changing attitudes is another driving force impacting Disney’s more progressive stance on sports betting. Citing a Seton Hall poll in 2017, only 46% of the respondents agreed that sports betting should be legal in the US.
Just four years later, that same survey reported that 80% of the 714 US-based respondents supported legal sports betting.
These are the type of numbers that are going to catch CEO’s eyes. Chapek now admits that ESPN would present the perfect platform for legal sports betting. That was obviously not the case just a few years ago.
One of the biggest opponents against legal sports betting along with the federal government was the NFL. The league was always concerned that betting on the games would impact the integrity of the games.
Once the US Supreme Court ruled against the federal government in favor of an individual state’s rights on the matter of legal sports betting, a major shift in attitude got its initial roots.
At first, the NFL did take a wait-and-see approach to the emerging US sportsbook industry. However, these days the biggest professional betting league in the US market has gone all in.
It has been estimated that the NFL has already taken in more that $270 million through its various partnerships with US sports betting operators and other gaming companies.
ESPN could be the biggest prize up for grabs when it comes to sports media properties. It now appears that it is only a matter of time before the worldwide leader in sports takes the plunge into the legal US sports betting industry.
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