$1.5 billion licensing deal turns Barstool Sportsbook into ESPN Bet

As ESPN's future moves toward direct-to-consumer, an agreement with Penn Entertainment will see the sportsbook's existing properties such as Barstool Sportsbook be renamed ESPN Bet. In return, Penn would pay ESPN $1.5 billion over the next ten years, as well as $500 million in warrants to buy shares of the operation and, potentially, the ability to appoint board members.

As early as 2022, then-Disney CEO Bob Chapek said Disney's opportunity "extends to sports betting, gaming and the metaverse." Now, Chapek is gone, the Metaverse team has disbanded, and new/old CEO Bob Iger describes its gambling strategy in an interview as, "...we're not really betting." We're enabling people to engage with companies like this." Iger is also trying to navigate a direct-to-consumer future for ESPN and is reportedly expanding the network's cable TV subscriber base to partners (major sports league) as viewership habits are declining and move towards streaming.

In practice, Iger's plan looks similar, with ESPN providing promotional services, access to ESPN talent and branding of betting content on its platforms under the ESPN banner.

As part of the deal, Penn Barstools is completing its arrangement with the company it purchased in February for more than $500 million, and that company will enter into "certain non- and other restrictive covenants in exchange for non-compete". subcontracting and selling back to founder Dave. Portnoy. As an agreement that Penn gets half of any deal made to resell or monetize Barstool.

In a video posted to social media, Portnoy confirmed that "for the first time in a decade," he again owned 100 percent of Barstool, applauded the pen, and said he owned stock in that company. . Has happened. Is. According to Portnoy, “Every time we did something, it was one step forward, two steps back. We were denied license because of me. What do you say."

In addition to an internal report detailing allegations of sexual misconduct by "degenerate gambler" Portnoy in 2021 (a lawsuit over the report was dismissed and then appealed before eventually being withdrawn), the partnership experienced other issues. Which included getting in trouble for things like "can do". ". Loose Parle" promotion.

The prospect of online gambling with sports entertainment has not blended as smoothly as operators anticipated a few years ago. Fox Bet shut down after Fubo TV discontinued its gambling integration last year. But soon, and for the next decade, ESPN will look like this.