ESPN strikes $1.5B deal to jump into sports betting with Penn Entertainment
You know ESPN the sports activities media big. Now brace your self for ESPN Bet, a rebranding of an current sports-betting app owned by Penn Entertainment, which is paying $1.5 billion plus different issues for unique rights to the ESPN identify.
The deal, introduced Tuesday, might take Walt Disney Co.-owned ESPN into uncharted waters. Disney is fiercely protecting of its family-friendly picture, not usually related to the world of sports activities playing.
Penn will function ESPN Bet, which ESPN has agreed to advertise throughout its on-line and broadcast platforms in an effort to generate “maximum fan awareness” of the app. ESPN Bet may also have unspecified “access” to ESPN expertise, the businesses stated.
Penn’s rights to the ESPN model will initially run for a decade and might be prolonged for an additional decade by mutual settlement. In addition to the $1.5 billion licensing deal, which shall be paid out over a decade, Penn may also grant ESPN rights price about $500 million to buy shares in Penn.
“Penn Entertainment is the perfect partner to build an unmatched user experience for sports betting with ESPN Bet,” ESPN chairman Jimmy Pitaro stated in a press release.
Disney has wrestled with the problem of adult-oriented leisure previously. Until about 15 years in the past, its Walt Disney World park in Orlando, Florida, featured a gated late-night space generally known as Pleasure Island — truly a reference to the 1940 movie “Pinocchio,” whose characters visited a den of iniquity by that identify. Pleasure Island featured bars, music venues and nightclubs along with eating places, procuring and a nightly countdown to “New Year’s Eve” full with fireworks.
When attendance waned, Disney closed down the Pleasure Island nightclubs in 2008 and redeveloped the location as a restaurant and procuring district now generally known as The Landing at Disney Springs.
ESPN added that it’s going to use its platforms “to educate sports fans on responsible gaming” — as an illustration by persevering with to cowl the sports activities betting business with “journalistic integrity,” making a “responsible gaming” committee throughout the firm and growing advertising and marketing tips that “safeguard” followers.
Penn additionally introduced that it offered Barstool Sports, an irreverent sports activities media website, again to its founder Dave Portnoy. Penn took a 36% stake of Barstool Sports in February 2020 for about $163 million and subsequently acquired the rest of the corporate for about $388 million in February 2023. Neither Penn nor Portnoy disclosed phrases of the divestment deal.
In a video posted on X, the location previously generally known as Twitter, Portnoy radiated pleasure over the location’s regained independence. The regulated playing business, he stated, “was probably not the best place for Barstool Sports and the kind of content we make.” Portnoy added that he’ll “never” promote the corporate. As a part of the divestment deal, Penn could be owed 50% of the gross proceeds from any future sale or “monetization” of Barstool.
