Better late than never
ESPN Bet got the green light to launch in the country’s biggest online sports betting market, enabling it to go live in the coming days. The New York State Gaming Commission (NYSGC) approved the transfer of WynnBET’s license to the Penn Interactive-operated brand on Monday.
ESPN Bet announced in February that it would pay Wynn $25m
While ESPN Bet announced in February that it would pay Wynn $25m for the license and the deal was completed a few months later, the state gambling regulator did not give its approval until this week. The NYSGC hadn’t met since June and was not willing to have a special session just to decide on the matter despite ESPN Bet hoping to be live in time for the start of the football season.
Getting in on the action
The reason ESPN Bet had to acquire Wynn’s license was the cap of nine online betting licenses in the state, with operators controlling each of them. WynnBET eventually gave up trying to compete and closed its sportsbooks. This is only the second time a new operator has entered the fold; the other was when Fanatics took over PointsBet.
potential soft launch before the weekend’s NFL action
Penn Interactive Executive Vice President Chris Rogers revealed on Monday that while it has some minor technology matters to address, the company intends to go live in the coming days and even have a potential soft launch before the weekend’s NFL action. Professional football is big business for operators, with New Yorkers having three teams in the region to support.
After fielding questions from some of the NYSGC commissioners about ESPN’s prominent position in college sports and the potential knock-on impact, Rogers said that the operator itself doesn’t hold any relationships with colleges and is very serious about not subjecting underage people to marketing messaging. He did note that ESPN Bet is occasionally brought up during college sports telecasts.
Tough times
While the news of the New York market access is good for the operator, things haven’t exactly been smooth sailing since the brand’s launch. Penn began running ESPN Bet after entering a ten-year agreement in August 2023 for $2bn and is live in 19 states, but controls only about 2.8% of the overall market according to a May report by Eilers & Krejcik.
It’s struggling to compete with the sector’s two dominant players, DraftKings and FanDuel, with BetMGM and Fanatics still in a better position. ESPN Bet originally hoped to have a 20% share of the market by 2027.
Penn itself has faced scrutiny from investors as its share price plummeted over the past couple of years. Some shareholders even called for a sale of the company and questioned the CEO’s $100m compensation.
Just this month, Penn announced a fresh round of layoffs after people were let go from the sports betting and iGaming divisions in July. In a letter, Penn Interactive CEO Jay Snowden explained that the layoffs were necessary to “help streamline reporting lines, enhance operational efficiencies, and leverage shared resources.”