Walt Disney has notoriously been an opponent to sports gambling over the years, adamant that the activity had no place in its “family-friendly” business. However, it took a big swig of sports gambling when the NBA Bubble hit Disney World in Orlando, FL earlier this year as the league needed a way to keep out of the clutches of COVID-19. That taste lingered and the company apparently liked it. As the parent company of the sports-focused ESPN, Disney has decided that it’s now a fan of sports gambling and is going to embrace the activity to help ESPN boost its lagging operations.
ESPN recently announced that it was going to be forced to let around 300 employees go and cancel 200 open positions. It had already implemented pay cuts to some executives and on-air personalities as a result of the coronavirus pandemic, and it has continued to slide in the market. Part of the reason, other than COVID-19, is the fact that virtually everyone else in the sports world is jumping on the sports gambling bandwagon, and Disney is now ready to climb on, as well.
In a recent investor call, Disney said that it would bring sports gambling content to ESPN, emphasizing the role it can play for its ESPN+ streaming platform. The company believes it will prove to be a “key opportunity” and an “important area of growth” for ESPN as it looks to reclaim the status it once held as the leader in sports content. This is a complete flip from Disney’s previous stance on the subject, which had chairman Bob Iger stating at one point, “I do think that there’s plenty of room [for sports gambling], 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.”
Disney was one of the entities that fought hard against casino expansion in Florida in 2018. It gave millions of dollars to campaign against legislation that was to appear on the state ballot that year, but its efforts turned out to be a waste of money. Florida voters agreed to allow new legislation that would give them more input into how the state’s casino market was shaped.
Further evidence that the company was warming up to sports gambling came last year when Disney made a deal to merge with 21st Century Fox, which had a stake in DraftKings. That was when Iger made his ill-fated comments about not getting involved more deeply in gambling. The move toward greater inclusion of sports gambling activity came this past September when ESPN signed deals with both Caesars and DraftKings to work with both the sports gambling and the fantasy sports markets.
Analysts jumped on the announcement that ESPN+ is going to begin to carry more sports gambling content, asserting that it is going to give the company a huge boost. Matias Dorta, an analyst with Roundhill Investments, stated, “Disney says sports betting is a focal point for the company and it’s clear sports fans are gravitating to ESPN+, which in turn, will introduce many viewers to the world of sports betting.”