In 2018, the US Supreme Court invalidated federal restrictions on wagers. Since then, 32 states and the District of Columbia have legalized wagering on sports. In 2021, sports-betting industry has grown to generate $ 4 billion in the US (Prang, 2019, May 14).
ESPN and Caesars Entertainment Corp decided to create sports-betting content including Daily Wager (Lombardo & Mullin, 2021, August 27). In addition, ESPN invested $250 million in DraftKings Inc. in 2015. DraftKings Inc. allows sports fans to play fantasy sports with real money at stake. In 2020, it went public.
ESPN, the sports-media giant and Walt Disney’s sports channel, has marketing partnerships with Caesars Entertainment Inc. and online gambling company DraftKings Inc.. By expanding these partnerships with the two major sports-betting companies, ESPN aims to get sports-betting license for around 3 billion in next 6-7 years (Lombardo & Mullin, 2021, August 27)
It is understandable that ESPN reaching out to keep young sports viewers, as most young adults do not spend time on TV or cables. Even its ex-CEO, Bob Iger did say that it is highly unlikely that Disney would be directly involved in gambling. As Walt Disney kept its business image as family entertainment enterprise, direct gambling offering might not be wise. Thus, it make sense that Disney expands its partnerships with major players (O’Brien, 2021, Sept 23).
Bob Iger had built multi-streaming channels with serious multiple intellectual property acquisitions of Marvel and Lucas characters. We will see this gamble working or not in next 10 years as this industry is still infantry and global economy is soft since Covid-19 Pandemic. However, any investor looks to diversify her or his portfolio with Disney at discount price recently, $172-175 per share. Disney has rooms to run as tourism has not recovered fully back to pre-Pandemic level while online subscription business model, streaming channels, and early stage of sports-betting content will support its revenue growth in the long run.