PENN Bets Big That ESPN Can Boost Sports Betting Market Share

PENN Bets Big That ESPN Can Boost Sports Betting Market Share
Fact Checked by Thomas Leary

It’s the day after, and the aftershocks from Tuesday’s massive $2 billion deal between PENN Entertainment and ESPN can still be felt not just across Massachusetts sports betting landscape, but the entire industry across the country.

In case you missed it after the stock markets closed in New York, the gaming company and the sports media giant each issued releases touting the partnership, in which PENN will rebrand its Barstool Sportsbook as ESPN Bet later this year. In exchange for rights to the name, PENN will pay ESPN $1.5 billion over a 10-year term and offer $500 million in stock options. 

ESPN can get rights to additional shares if the online sports betting application hits certain market share goals. These goals will include ESPN Bet Massachusetts and other state-specific sportsbooks.

At the same time, PENN announced it was shedding itself of Barstool Sports, a brand that’s been as much a liability as an asset, and rebranding its Barstool Sportsbook under the ESPN name. It’s giving the controversial sports media outlet back to founder Dave Portnoy as a lovely parting gift. 

In return, Portnoy has agreed to non-compete clauses and other restrictions, and should he sell Barstool again — like he did when he agreed to sell it to PENN for more than $550 million (a deal, by the way, that wasn’t completed until six months ago when PENN bought the remaining 64%) — PENN could take up to 50% of the proceeds.

Bonus Bets Expire in 7 Days. One New Customer Offer Only. Must be 21+ to participate & present in MA. In Partnership with MGM Springfield. Visit for T&Cs. Play it smart from the start with GameSense. Gambling Problem? Call 1-800-327-5050 or visit US promotional offers not available in NY, NV, or Puerto Rico.

Why Now?

Tuesday’s announcement ends years of speculation on whether the Disney-owned sports media outlet would ever branch out into the gaming realm. Clearly, the company is fully committed, and will be offering Massachusetts sportsbook promos, and other sports betting promotions across the country. 

Yet, Tuesday’s news surprised many in the gaming industry, which wasn’t expecting PENN to cut ties with a brand it invested in substantially in recent years and become ESPN’s partner.

The new deal is PENN’s latest attempt to bolster its position as a sports betting operator in the U.S. In essence, it’s trading the edgy brand it thought would lead to market share acquisition for a better-known mainstream one in hopes that ESPN’s massive — but dwindling — audience will gravitate toward the sportsbook with its name on it.

The agreement between ESPN and PENN includes a 10-year option to extend. However, it also includes language that stipulates either party can pull the plug after just three years if ESPN Bet “has not achieved a specified level of market share based on gross gaming revenue” in states where it’s licensed. 

ESPN can also back out after the third or seventh year if certain market access targets are not met. If sportsbooks like DraftKings Massachusetts and others continue to hold market share, ESPN could return back to its main business strategy. 

Those targets are not listed, but ESPN’s additional stock options are triggered if the sportsbook hits 20%, 22.5% and 25% market share. It could take ESPN Bet a while to get there.

Massachusetts bettors must be 21+ and present to place wagers in the state. Gambling problem in Massachusetts? Call 1-800-327-5050 to speak with a trained specialist free and confidentially 24/7. Full Terms and Conditions Apply.

ESPN Bet Has A Wide Gap To Bridge

Through the first four months of Massachusetts sports betting apps, Barstool Sportsbook accounts for 4.6% of the $548.2 million handle and has claimed 3.9% of the taxable revenue. 

DraftKings has 49% of the handle and 45.5% of the revenue, and FanDuel has 31.1% and 35%, respectively.

It’s not much different in Ohio, where online sports betting started in January. There, Barstool has a 4.6% handle share and 2.7% of the revenue, while again FanDuel (39% and 46.5%) and DraftKings (32.4% and 28.2%) dominate.

And don’t forget, ESPN Bet will likely debut around the same time Fanatics prepares for its full-scale launch as it takes over in states where PointsBet is licensed. 

It’s a similar story in other online sports betting states, too. So, it’s fair to question whether it’s realistic for anyone, even with the ESPN name attached to it, to put a meaningful dent into the market share controlled by the two online sports betting giants, who, by the way, are now starting to turn a profit?

PENN’s willing to spend $150 million yearly, not including stock, to find out.



Steve is an accomplished, award-winning reporter with more than 20 years of experience covering gaming, sports, politics and business. He has written for the Associated Press, Reuters, The Louisville Courier Journal, The Center Square and numerous other publications. Based in Louisville, Ky., Steve has covered the expansion of sports betting in the U.S. and other gaming matters.

Cited by leading media organizations, such as: