ESPN strikes $1.5B deal to jump into sports betting with Penn Entertainment

by Gabriel Martinez
Sports Betting Partnership

ESPN has entered a significant agreement with Penn Entertainment, worth $1.5 billion, to enter the realm of sports betting. This partnership involves rebranding an existing sports-betting app under the name ESPN Bet, which Penn Entertainment will operate. This move is somewhat unexpected, given Disney’s careful preservation of its family-friendly reputation, which doesn’t typically align with sports gambling. As part of the deal, ESPN will promote ESPN Bet on its online and broadcast platforms to maximize its visibility among fans. The app will also have some access to ESPN talent.

Penn Entertainment’s exclusive rights to the ESPN brand will last for an initial decade, with a possibility of extending for another decade through mutual consent. Beyond the $1.5 billion licensing fee, which will be paid over ten years, Penn will also provide ESPN with rights valued at approximately $500 million to purchase shares in Penn.

ESPN Chairman Jimmy Pitaro expressed confidence in Penn Entertainment’s ability to enhance the sports betting experience through ESPN Bet. ESPN plans to use its platforms to educate sports enthusiasts about responsible gaming, maintaining their journalistic integrity while covering the sports betting industry. They intend to establish a “responsible gaming” committee and formulate marketing guidelines that prioritize fan protection.

In other news, Penn Entertainment has sold Barstool Sports, a bold sports media website, back to its founder, Dave Portnoy. This comes after Penn initially acquired a 36% stake in Barstool Sports in early 2020 and later purchased the remaining portion in February 2023. The details of this sale have not been disclosed, but as part of the deal, Penn will be entitled to 50% of future proceeds from any potential sale or monetization of Barstool.

Frequently Asked Questions (FAQs) about Sports Betting Partnership

What is the nature of the partnership between ESPN and Penn Entertainment?

ESPN has entered a groundbreaking partnership with Penn Entertainment, a $1.5 billion deal that introduces ESPN Bet, a sports-betting app operated by Penn Entertainment. This collaboration combines ESPN’s reputable brand with Penn Entertainment’s expertise in the sports gambling domain.

How does this partnership align with Disney’s family-friendly image?

The partnership might seem unconventional for Disney-owned ESPN, known for its family-friendly reputation. However, the deal allows ESPN to tap into the growing sports betting market while Penn Entertainment operates the app. ESPN intends to educate fans on responsible gaming to maintain its integrity.

What are the terms of Penn Entertainment’s rights to the ESPN brand?

Initially, Penn Entertainment holds exclusive rights to the ESPN brand for a decade, with potential for a decade-long extension by mutual agreement. Alongside the $1.5 billion licensing fee paid over ten years, Penn will grant ESPN rights worth around $500 million to purchase shares in Penn Entertainment.

How will ESPN Bet be promoted to fans?

ESPN will promote ESPN Bet across its online and broadcast platforms to ensure maximum fan awareness. This includes utilizing its vast reach to inform and educate sports enthusiasts about responsible gaming practices.

What benefits does Penn Entertainment’s divestment of Barstool Sports offer?

Penn Entertainment has divested Barstool Sports back to its founder. This move aligns with the company’s focus on the sports betting venture with ESPN Bet. While specific terms of the divestment aren’t disclosed, Penn stands to gain 50% of future proceeds from any potential sale or monetization of Barstool Sports.

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WordNerd42 August 9, 2023 - 4:49 am

espn’s stridin’ into new turf here. fam-friendly espn plus gamblin’? odd combo, like pineapples on pizza. but hey, educatin’ fans ’bout game responsib’ly’s key.

BballChamp99 August 9, 2023 - 6:22 am

whoa, barstool’s back to da founder? dat’s wild. penn’s gamblin’ journey heats up. wonder how long till espn’s callin’ all the shots.

GamerDude23 August 9, 2023 - 10:32 pm

penn entertainment makin’ a big splash wit dis move. espn bet sounds rad, hope it don’t mess up espn’s vibe tho. wonder if dey got insider info?


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