Disney’s CEO, Bob Iger, has divulged plans for a revamped ESPN application with an exciting new prospect for sports fans— access to sports betting. Although the blueprint wasn’t laid out explicitly, the anticipatory buzz is already building up in the sports ecosystem owing to this bold move by Disney.
In a previous conversation with David Faber, a journalist with CNBC, Iger dropped hints about the transformation awaiting ESPN. He remained silent, however, about ESPN Bet, the sports betting initiative that ESPN embarked upon through their partnership with Penn Entertainment, whose signature is seen on the sports wagering app that rolled out under ESPN branding.
Articulating his vision for ESPN’s future, Iger stated, “ “ESPN over-the-top is going to have multiple features to it. There will be fantasy sports. There will be the opportunity to bet on sports basically right off the app. There will be significantly more consumer engagement opportunities.”
In Iger’s vision, the ESPN ‘over-the-top’ refers not merely to the cable network, or the mobile application, but encompasses the entirety of the traditional ESPN product. He also set a clear distinction between ESPN’s flagship presence and an impending joint venture that ESPN is planning with FOX and Warner Bros. Discovery. This collaborative endeavor plans to amalgamate a broad-ranging corpus of sports content into a single streaming platform.
Moving on to the key aspects of the joint venture, he underscored that it won’t be an imitation of what ESPN ‘over the top’ promises to offer. The direct access to sports betting that ESPN’s flagship product may put forth, he explained, will not necessarily be on the table in this joint venture.
Iger stopped short of commenting if sports betting will find a place in the collaborative venture with FOX and Warner Bros. However, it seemed that one cannot rule out such an inclusion considering the broad aggregation of sports content- ranging from college sports, Major League Baseball, NASCAR, to NBA, NFL, NHL- which are all being packaged into the streaming service.
However, this move could potentially stir conflicts owing to Disney’s ties to Penn and FOX’s impending right to own a significant stake in FanDuel. Furthering speculations are rumors about Warner Bros.’ TBS, TNT, and truTV possibly venturing deeper into sports betting in the future.
In the past, Iger had made it quite clear that ESPN will categorically stay away from directly accepting sports bets. Nevertheless, this doesn’t eliminate the possible avenues, including the ESPN Bet partnership with Penn, that ESPN can explore and leverage to augment its deep-seated existence in sports wagering.
ESPN Bet, still an early entrant in the sports betting scene, appears to be right on the money, mutually benefiting ESPN and Penn. The partnership has exhibited promising growth with ESPN Bet’s performance outpacing Barstool Sportsbook, Penn’s earlier sports wagering app.
There lies a strong fiscal connection between Disney and the casino operator, with the entertainment conglomerate banking heavily on ESPN Bet’s booming growth. As a testament to this relationship, Penn has contractual obligations to remit $1.5 billion to ESPN over the course of a decade. This entails the use of the ESPN Bet branding throughout the specified period with an exclusive option to extend this alliance for another decade. This is further bolstered by $500 million in equity warrants vested to the sports network by the gaming company.
