Several media outlets, including the Wall Street Journal, have reported that ESPN is seeking to license its brand to major sports betting companies in a multi-year deal worth $3 billion.
According to the reports, ESPN has been holding talks with sportsbook operators, including Caesars Entertainment and DraftKings. ESPN is already linked to these two parties through existing partnerships.
Under the terms of a potential deal, the sportsbook will be allowed to use the ESPN name for branding purposes. The deal may also require the sportsbook to spend a certain amount of money advertising its product on the ESPN platform.
For years, the Walt Disney-owned ESPN has avoided directly been involved in gambling and has been extremely cautious about striking deals that links it directly to the sports betting sphere. This, to keep the company in line with its “good, clean, family-fun” image.
But ESPN is finding it difficult to remain out of the sports betting arena altogether, especially in such a profitable and fast-growing industry. A brand-licensing deal may allow ESPN to profit from the industry without directly taking bets or making payouts to winners; thus avoiding the image of being party to gambling. It also means that ESPN won’t need to apply for licenses in states where licenses where necessary.