Yesterday, PENN Entertainment entered into a deal with ESPN (a subsidiary of the Disney Company), where the two will create a new domestic sportsbook brand – ESPN BET.
PENN operates sportsbooks that will be rebranded to ESPN BET in the following sixteen legal sports betting states:
- New Jersey
- West Virginia
The $1.5 billion deal also entailed the re-purchase of the Barstool Sports brand by former owner Dave Portnoy, who had just sold the assets to PENN earlier this year.
PENN will garner a 50% profit share if the Barstool Sports brand is monetized in any way going forth.
Emergency Press Conference – I Bought Back Barstool Sports pic.twitter.com/dmUk0eNowx
— Dave Portnoy (@stoolpresidente) August 8, 2023
The Disney Company and PENN Entertainment’s stocks rose following the announcement of the agreement.
“We are confident that the combination of our unparalleled audience along with PENN’s operational expertise and state-of-the-art technology provides us with a tremendous opportunity to serve the ever-growing number of consumers interested in betting…”
ESPN Chairman Jimmy Pitaro
What Happens Next?
ESPN has partnered with other domestic sportsbooks in the past to provide betting odds for analysis and in-game advertisements. The sports media giant has now gone in-house and will support its own brand on the air exclusively.
This will certainly aid in the expansion of ESPN BET beyond the sixteen states it currently operates in.
The branding and on-air component grants ESPN the opportunity to dominate the domestic sports betting market in the United States. ESPN’s name recognition will make new gamblers more comfortable because it is a brand they’ve known and trusted for decades.
ESPN’s coverage of most major sports grants them a unique platform to advertise their sports betting services. For instance, ESPN can discuss the latest lines for betting on the CFP National Championship in their sportsbook during their broadcast of the game.
What Will Happen With Barstool Sports?
Now that Barstool Sports is no longer tied to any corporate giants, the entity can return to its roots – a sports blog with edgy content. Whether or not the name commands attention from that market remains to be seen.
Less than 24 hours after being required by Portnoy, Barstool Sports rehired Ben Mintz, a blogger who was terminated in 2022 for uttering a racial slur on air.
PENN will still receive half the profits from anything Barstool ever does, but the entity could sever ties if they attract too much heat in their future endeavors.