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Disney Discloses Plans to Roll Out DFS and Sports Betting on ESPN+
By Jeff Osienya Dec 13, 2020 IndustryAfter shying away from gambling for years, Disney is dancing to another tune and will formally dip its toe in the waters of sports betting through its ESPN+ content streaming platform to strengthen the appeal of the channel.The Walt Disney Company, a multinational mass media and entertainment conglomerate, unequivocally expressed its interest in officially venturing into the world of daily fantasy sports (DFS) and regular sports betting on Thursday, during its annual investor day. At the same event, the company disclosed that it will be creating a dedicated sports hub for DFS and sports betting through its ESPN+, its sports streaming vertical.
This is such big and unexpected news particularly because, for a long time, Disney has been adamant when it came to the question of sports betting, preferring not to be associated with any form of gambling in a bid to maintain its image of a “family-friendly” business. In fact, in a February 2019 earnings call, Bob Iger, the Disney Chairperson, and CEO expressed the company’s stand in the following statement;
Quote"I don’t see The Walt Disney Company, certainly in the near term, getting involved in the business of gambling, in effect, by facilitating gambling in any way,"
I do think that there’s plenty of room, and ESPN has done some of this already and they may do more to provide information in coverage of sports that would be relevant to and of particular interest to gambling and not be shy about it, basically being fairly overt about it. But getting into the business of gambling, I rather doubt it."
Bob’s statement came after a lot of speculation that ESPN was looking to make an entry into the world of gambling. And even after Disney acquired Fox in March 2019, to make the company indirect investors in DraftKings, the anti-gambling narrative was still maintained.
But then fast-tracking to July 2020, the company hosted the remainder of the 2019-20 NBA season in the Walt Disney World Resort in Orlando, Florida, after the league resumed from the COVID-19 hiatus. The NBA season is one of the biggest revenue streams for sports betting brands in the USA, and when hosting the remainder of the NBA season, Disney likely had an epiphany on the company’s lucrative future in sports betting.
Later in August 2020, Disney edged closer to the realm of sports betting when its media house ESPN penned a partnership with casino and sportsbook operator Caesars Entertainment, to allow the coverage of ESPN sports across Caesar’s sports betting platforms.
A Move to Bolster ESPN’s Appeal Particularly Among Younger Generations
In the Thursday annual investor day, Disney pointed out that rolling out DFS and sports betting content would ramp up its efforts in growing the ESPN+ platform which was unveiled in 2018. The company cited that it added a fresh stream of 11.5 million new subscribers since launch, and it plans to continue growing the user base targeting 8 to 12 million more subscribers by 2024, particularly by targeting younger audiences through the introduction of DFS and sports betting.
Disney added that starting 2024, the ESPN+ streaming platform will be the official home of the NCAA Southern Conference collegiate league. ESPN+ will also be debuting an exclusive morning recap show steered by Stephen Smith, one of the most influential voices in sports commentary. At 11.5 million subscribers, however, ESPN+ is far behind Disney’s other streaming services, with Disney+ at the top having over 86 million subscribers, followed by Hulu with 38.8 million subscribers.
This is an important step for Disney’s future even though some analysts suggest that it might be a little too late for the company to put itself in a position of strength in the game. Whatever the case, hosting live sports is one of the surest ways to reel in more players onto the ESPN platform and of course benefit from offering real-time advertising services.
Embracing DFS and sports betting is surely the most natural thing to do given the recent growth of the two markets in question as the USA states continue to welcome regulated sports betting in their borders. By end of 2019, the DFS market was estimated to be worth $18.6 billion and recent research by a prominent analytics firm, Allied Market, projected that the value of the DFS vertical would hit $48.6 billion come 2027 based on a 13.9% CAGR in the next 6 years, between 2021 and 2027.
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