ESPN Bet Seems Like A Pretty Big Mess
We’re less than a year into Penn Entertainment’s pivot from Barstool to ESPN as the brand for its sportsbook. While we can’t close the door entirely on ESPN Bet turning things around and reaching the top three in US sports betting, “It’s getting late early,” as Yogi Berra would say.
Of late:
Penn laid off staff related to its interactive division (ESPN Bet), about a month and a half before football season begins. Maybe the layoffs were necessary, but throwing fewer people at the problem and introducing some chaos at a crucial time is questionable at best. PENN 0.00%↑ stock is down since the news.
Sources told Earnings & More that little has changed since the Barstool pivot, and most of Penn’s strategy is tied up in leveraging ESPN’s name. If true, that’s a pretty damning indictment of how Penn is attacking the online sports betting industry.
Amid all this came this data (via Legal Sports Report): “Citizens JPM also compared June 2024 figures to June 2023 when Barstool was still live. Handle share is down to 1.9% from 2.6% while revenue is up to 2.0% from 1.8%.” Yes, it’s summer in America, which is the slow period, but the fact that Penn is more-or-less flat from Barstool to ESPN during any interval is frankly nuts.
Closing Line Consulting
Need help with gambling content, navigating the North American gaming industry, communications/PR, or research and analysis? I have a consultancy to help in gaming and beyond. Reach out if you want to have a conversation. Learn more about CLC here.
At this point, it’s fair to question if Penn selling Barstool (FOR ONE AMERICAN DOLLAR) was the right move; the problems seem to go far beyond the name on the sportsbook. Even my relatively tepid expectations for the launch of ESPN Bet — which were on the pessimistic end of the scale — haven’t been met. It’s clearly behind FanDuel/DraftKings/BetMGM right now and is not even a clear No. 4.
I’ve heard a lot made of 1. further integration with ESPN and 2. an improved sportsbook product. I am skeptical that No. 1 is going to create anything beyond incremental gains. If No. 2 is the real gamechanger, Penn shouldn’t have lit money on fire to create a clean break from Barstool and then license the ESPN brand.
If ESPN Bet is going to be a meaningful competitor in the short term and a winner in the long term, change is needed. Layoffs and the same strategy that led to cutting ties with Barstool aren’t going to lead Penn to the promised land.
The Closing Line is a publication of +More Media.
For sponsorship inquiries, email dustin@closinglineconsulting.com or scott@andmore.media.
