ESPN Bet to rebrand as Disney’s sports media giant enters deal with DraftKings
Penn Entertainment will go solo with theScore Bet while Draftkings will power ESPN’s betting tab.
US.- A major shakeup on the US sports betting market will see ESPN Bet disappear while Disney’s sports media group enters a new deal with DraftKings. Meanwhile, Penn Entertainment’s online sportsbook will be rebranded as theScore Bet.
To recap, Penn signed a $1.5bn 10-year deal with ESPN in 2023 after ending a previous agreement with Barstool Sports. That led to the launch of ESPN Bet in November 2023. But just two years into the deal, the two parties have decided to part ways because the partnership hadn’t been as successful as expected. Penn and ESPN announced today that their exclusive agreement will end on December 1.
Within an hour of the announcement, ESPN announced a new partnership with DraftKings, naming the operator the ”exclusive Official Sportsbook and Odds Provider of ESPN”.
ESPN said that DraftKings will play a major role across its digital platforms. That will include powering the betting tab in the ESPN app, which DraftKings customers will receive promotions for ESPN Unlimited, ESPN’s newly launched direct-to-consumer product. ESPN said it’s also “pursuing other media and marketing opportunities within this space.”
Chairman Jimmy Pitaro added: “Our betting approach has focused on offering an integrated experience within our products. Working with DraftKings, a leader in the space, will allow us to build upon that foundation, continue to super-serve passionate sports fans and grow our ESPN direct-to-consumer business.”
ESPN Bet app to become theScore Bet
Penn’s US online sportsbook will be rebranded from ESPN Bet to theScore Bet next month, taking on the branding of the Canadian sportsbook that the company bought back in 2021. This means that, subject to regulatory approvals, Penn will unify its brand across the US and Canada.
Unlike with the transition from Barstool Sports to ESPN Bet, the regional casino operator will keep the same app this time around, which it says will avoid operational disruptions since customers will not need to download a new app or re-register.
Penn chief executive Jay Snowden told analysts on a third quarter earnings call today (November 6) that this was expected to minimise retention risks. The company also confirmed that it would end all payments to ESPN at the end of Q4, which it said would free up resources to invest in North American markets as it replaces fixed media spending with performance-based and regionally targeted marketing.
Snowden said in a joint statement: “When we first announced our partnership with ESPN, both sides made it clear that we expected to compete for a podium position in the space. Although we made significant progress in improving our product offering and building a cohesive ecosystem with ESPN, we have mutually and amicably agreed to wind down our collaboration.
He added: ”We are realigning our digital focus to leverage the strength of our US iCasino and Canadian operations, while continuing to use OSB to drive both the acquisition of customers with significant lifetime value and unique cross-sell opportunities across PENN’s retail and digital assets. PENN’s iCasino forward approach has clear long-term alignment to our core business, which will focus on cross-sell opportunities across our ecosystem and enhanced connectivity to our 33 million member PENN Play loyalty program.
“Our OSB offerings will continue to provide top of funnel acquisition and cross-sell opportunities for our Hollywood-branded iCasino, which will remain integrated into our OSB product in states where legal, in addition to serving as a standalone iCasino app.”
ESPN will retain all vested warrants to buy about 8m shares of Penn, but will forfeit all unvested warrants. The agreement was for warrants to buy 31.8m Penn shares to vest over 10 years.
