Bob Chapek, CEO at Walt Disney Company, has said it looks to broaden its activities to sports betting via ESPN. The enterprise wants to strengthen its presence in this field, and it can build significant partnerships, given the reach. Chapek has noted it has the potential for meaningful collaborations with other operators. The company has not had a strong year, with the earnings under expectations, but the sports market has been its brightest sector.
ESPN+ has increased subscribers by 66%, with 90% of the most-watched broadcasts on Disney’s networks in 2020 being sports events. Sports are an excellent chance for growth, especially after signing a decade-long rights deal with the NFL, starting in 2023. Still, ESPN has recorded flat advertising revenue in Q4, compared to the last year, and sports betting could spice things up. Chapek has added the new activity would appeal to a younger audience. They like to complete the experience of watching sports by playing games.
Since the company policy has always been driven by consumers’ wishes, Disney has to contemplate entering the sports betting arena. The CEO considers ESPN to be a perfect platform for the activity. The company has already cut deals with giants like Caesars Entertainment and DraftKings. They were even discussing a brand licensing agreement potentially worth $3bn. However, it is not explained how exactly ESPN and Disney would enter the industry. The only sure thing, for now, is the companies and the fans are equally interested in the activity.
Highly Profitable Activity
Since the sports betting ban was lifted in the US in 2018, thirty-two states have launched gaming markets. The industry is flourishing and bringing enormous profits, with the USA betting $24bn with sportsbooks during the first half of 2021. It means almost $2bn in gross gaming revenue, which is expected to become $30bn by 2030. Multiple media companies, from Fox to Sports Illustrated, have already made deals with various sports betting enterprises. A stigma to gaming doesn’t exist anymore, with numerous companies making partners regularly.
Gaming in general, but especially sports betting, is not considered a vice anymore. It is now part of the sports-watching culture and an opportunity for companies to expand their activities. Chapek has stated the potential signing of the betting agreements and partnerships would not stain Disney’s reputation. Therefore, the enterprise will actively pursue the chance to broaden its demographics and increase its revenue.
Opportunity for Growth
Disney will look to utilize the fact the attitudes towards gaming are currently shifting. The ambition is to bring considerable revenue to the enterprise without hurting its family-friendly orientation. The fans seeing ESPN and Disney as separate brands will relieve the transition into the new industry significantly. The betting component will reinforce the ESPN brand without impacting Disney. Therefore, both companies will use sports betting as an opportunity to grow and record huge profits in the process.