Why Barstool’s Troubles Might Impact ESPN’s Sports Betting Decision – Opinion

Posted on: December 27, 2022, 07:01h. 

Last updated on: December 27, 2022, 12:33h.

If you think that ESPN should pursue a sportsbook, then you might want to watch a Massachusetts Gaming Commission (MGC) meeting from last week.

From left, Desmond Howard, Rece Davis, Pat McAfee, Lee Corso, and Kirk Herbstreit sit on the ESPN College GameDay stage set up at the University of Tennessee before the Tennessee-Florida game in September. (Image: ESPN)

For hours last Tuesday, MGC members questioned Penn Entertainment President and CEO Jay Snowden about Barstool Sports. Penn will wholly own it by February, when it closes on acquiring the remaining 64% of shares of the headline-making sports and pop culture media site. Two years ago, Penn bought a minority stake in the company and chose to use the brand for its sports betting operations.

Here’s a link to the meeting. The part with Snowden starts roughly halfway through the six-hour-plus meeting.

Snowden was asked about Barstool founder Dave Portnoy, who has been the subject of critical articles published by Business Insider and The New York Times. He was grilled about Dan Katz, aka Barstool Big Cat. It wasn’t just their connection to the company or their involvement in sports betting. Commissioner Eileen O’Brien questioned some of the content Barstool produces and believes the site would be a drag on Penn’s suitability because of “character” and “integrity” concerns.

Those concerns stem because commissioners see Barstool Sports, the media company, as the marketing division of Penn that promotes Barstool Sportsbook.

Barstool to be Investigated in Massachusetts

There were also questions about the pending fine Penn faces in Ohio due to Barstool Sports promoting the sportsbook. That occurred during a November broadcast of its College Football Show that took place at the University of Toledo. The Ohio Casino Control Commission (OCCC) found that the show violated several regulations, including promoting sports betting to individuals under 21. Those individuals cannot bet legally on sports in the state.

Barstool faces a $250K fine for that. Snowden told the Massachusetts officials that the show was a “mistake,” and that Penn would not allow anyone under 21 to attend a future live Barstool College Football Show broadcast.

When we know about these things, when we make these mistakes on our own, we self-report,” Snowden said. “And I think in this case, we didn’t realize we made some mistakes, which is why it was brought to our attention. And we’ll pay the fine, and we’ll move on.”

In the end, Penn received only a temporary retail license for its Plainridge Park facility. One of the conditions for the license is that Penn fully cooperates with an investigation into Barstool Sports by the commission’s Investigations and Enforcement Bureau. The study will determine if Barstool meets suitability requirements for full licensure.

The hearing for Penn and Barstool’s online application will be heard in early January.

Why It May Matter to ESPN

So, how do Barstool’s woes potentially affect ESPN?

Well, it’s not on the content side. The Disney-owned sports media empire is downright vanilla when compared to Barstool. ESPN’s edgiest commentator would be the tamest on Barstool, and when someone at ESPN says something controversial, either on or off the air, it usually leads to their eventual departure.

No, ESPN’s biggest issue is its underage audience.

Like Barstool, ESPN hosts a weekly college football preview show, and each week ESPN’s College GameDay travels to the site of one of the biggest games taking place that week. In most instances, that means GameDay is broadcasting from or near a college campus. And that means it’s attracting a lot of college students for their audience, many of whom are likely to need fake IDs to get into bars.

GameDay also attracts families for its live audience, as evidenced in the tweet below.

GameDay also attracts a lot of viewers on TV. Two weeks ago, the network announced that the show posted a record regular-season viewership total and drew an average of 2.1 million viewers a week.

Would some regulators require ESPN to limit GameDay live shows to people only over 21? Or would ESPN be precluded from promoting its sportsbook if the live audience included those under 21? And if the latter is the case, why have a sportsbook if you can’t promote it on one of your flagship shows?

That’s not the only issue tied to the potential for an underaged audience to be exposed to sports betting. In Disney’s most recent 10-K filing with the SEC, the company said ESPN reaches 74 million households, and data from National Media Spots indicates that 31% of those households have at least one child.

Kids’ viewing habits are much different today than in my generation. Many of us grew up watching SportsCenter before we went to bed, and again when we got up the next morning. But ESPN still attracts a lot of kids who watch games and shows, or portions of them, with their families.

Is Sports Betting Worth it for ESPN?

Now, I’ll admit I might be going a little to the extreme on this. I also know there are numerous live sporting events where odds are incorporated into the broadcast. Also, if protecting minors from sports betting was truly a concern nationwide, commercials for sportsbooks would be banned from the air like cigarettes.

But the issue has been raised in Massachusetts and Ohio, two states that will likely be very large sports betting markets in the very near future. Those would likely be states an ESPN sportsbook would want to be in if it wants to be a major player in the industry.

Not all regulators are like the MGC or the OCCC. But thanks to the recent series of articles from The New York Times and other outlets, sports betting may come under more scrutiny in state capitals moving forward. Expect more lawmakers and regulators to ask more questions than they may have before.

And if that’s the case, then ESPN executives will need to ask themselves if ESPN The Sportsbook is worth it, especially if it means making changes elsewhere.

The answer to that question is likely, no.