Scott Van Pelt, or SVP as he is affectionately known by fans, has become a beloved anchor at ESPN over the past two decades. His commentaries on the US Masters golf tournament and breaking news reports on SportsCenter have endeared him to viewers.
In a recent ad promoting the launch of ESPN Bet, a new betting platform developed by Disney-owned ESPN and Penn Entertainment, Van Pelt excitedly pumps his fist as a notification on his phone declares him a “winner!” This 15-second commercial gives a glimpse into the significant investment Penn has made to secure a licensing deal with ESPN, aiming to break the duopoly of DraftKings and FanDuel in the US online sports betting market.
The partnership aims to leverage ESPN’s broadcasting stars and large audience to create a unique space in the sports betting market. With the launch of ESPN Bet in 17 states, Penn will also invest an additional $150 million a year into marketing the platform.
Other companies, such as Fanatics, have also entered the market, but the early movers have established a significant lead. The pace of market consolidation has made it challenging for new entrants to gain traction. Despite this, Fanatics and PointsBet, which was acquired by Fanatics, have seen moderate success.
Fanatics CEO Matt King acknowledges their position as a second mover and emphasizes the importance of taking time to develop a superior product. In contrast, Penn and ESPN do not have the luxury of time, as there are termination clauses in place if ESPN Bet fails to gain significant market share.
The potential for ESPN Bet is promising, with a survey showing that over 50% of casual sports bettors are open to trying the platform. Penn’s Barstool sportsbook will also prompt its 2 million customers to download the ESPN Bet app, aiming to expand its reach to a wide audience of sports fans who could become regular users.
ESPN Bet will be integrated into ESPN’s TV shows, and hosts like Van Pelt will recommend bets for users on the app. This move signifies a shift in strategy for Disney, who initially expressed hesitancy about entering the gambling business but now sees it as a means of returning ESPN to growth in a changing media landscape.
Ultimately, the US sports betting market is projected to grow significantly in the coming years, offering prospects for new entrants despite the dominance of major players like DraftKings and FanDuel. The potential for growth is leading companies like ESPN and Penn to innovate and compete in a highly dynamic and evolving market.
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