ESPN Bet Unlikely to Threaten FanDuel, DraftKings Dominance, Says Analyst

In tidings endure month that temporarily rocked the sports wagering landscape, William Penn Entertainment (NASDAQ: PENN) announced it testament pay off $1.5 1000000000 over 10 years to permission the ESPN Bet brand. That’s piece parting ways with Barstool Sports for a mere $1.

While the deal is viewed as a potency water parting moment for William Penn and ESPN, some analysts doubt the power of the unexampled sportsbook make to setting a credible gainsay to the monumental securities industry share held past Flutter Entertainment’s (OTC: PDYPY) FanDuel and DraftKings (NASDAQ: DKNG).

Sports betting has been legal inwards the U.S. for around five-and-a-half years, and it took less time than that for those operators to form what’s now essentially a duopoly, as they combine for just about 75% of the market.

ARK Investment Management psychoanalyst St. Andrew Kim noted that FanDuel and DraftKings combined for nearly two-thirds apportion of the house servant online sports wagering marketplace in June. That’s spell Penn’s Barstool Sports captured just now 4% of the market.

If PENN could not win securities industry divvy up with Barstool, how will it transportation with ESPN, a legacy media holding battling a multi-year go down inwards market place share?,” opined the analyst. “Since 2010, when it peaked at 100 million, the figure of ESPN telegraph subscribers has declined 3% at an yearbook grade to 71 million.”

It should follow noted that Florida-based ARK is unity of the largest institutional owners of DraftKings stock. But Kim didn’t overtly indorse the shares in his note.

Tough Road Ahead for ESPN Bet

The outlook for ESPN Bet is arguably mixed. On the more prescribed position of the ledger, the ESPN firebrand clearly resonates with sports fans, and the resources possessed past the network and parent companionship Walt Walt Disney (NYSE: DIS) are substantial.

How that translates to attracting sports wagering clients remains to live seen. A recent survey by investment camber Jefferies indicates that a fairish amount of sports bettors are likely to maintain multiple betting accounts. But a massive per centum are also inclined to remain loyal to books they’ve used for some time. That’s honest news for the likes of DraftKings and FanDuel and potentially negatively charged for littler rivals.

“Respondents continued to demonstrate loyalty, as 89% of respondents indicated they are likely/very potential to uphold betting with their electric current accounts, versus 83% inward January,” observed Jefferies. “It is also worth noting that bettors are to a greater extent likely to stay fresh more than I sportsbook account, with 33% of the respondents indicating spirit to maintain simply unity answer for (40% prior) and 39% destine to have 2 (37% prior), while those intending to keep leash accounts grew to 20% from 15% inwards the finally survey.”

Kim pointed come out that thither are avenues for Penn to do good from the ESPN relationship.

“Operated past PENN, ESPN Bet should welfare from scoop promotions past ESPN, including programming, content, and talent,” added Kim.

ESPN Streaming Could Affect Betting

Penn’s business deal with ESPN arrives when the latter is grappling with ratifier contrition as consumers displace outside from running(a) television — “cord cutting.” The network tin offset printing those declines and applied science development via its ESPN+ streaming service.

However, Disney late announced cost hikes for all of its streaming services, including ESPN+, and it remains to be seen if that’s a misstep at a time when consumers are increasingly cost-conscious.

Ark’s Kim is skeptical. “As it adapts to streaming, how will ESPN protect its cognitive content library and sports dealership from giving tech? Specifically, how testament it purchase its dispersion and descale to marketplace ESPN Bet/PENN and vie against the other sportsbook operators?

While no troupe has been capable to perforate the DraftKings-FanDuel duopoly, could ESPN Bet follow the first? We would follow surprised.”

Experience the thrill of winning big with our exciting selection of slot games at dahmain.com - the ultimate destination for online casino entertainment. Whether you're a seasoned player or new to the world of online casinos, we have something for everyone to enjoy and experience the excitement of hitting the jackpot!