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ESPN Inks Major Gambling Pact With DraftKings After Ending Deal With Penn Entertainment
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Published in Media and Entertainment on Thursday, November 6th 2025 at 9:09 GMT by Variety- 🞛 This publication is a summary or evaluation of another publication
- 🞛 This publication contains editorial commentary or bias from the source
A Brief History of ESPN Bet
ESPN Bet first launched in August 2021 as ESPN’s in‑house digital sports‑betting service, aiming to capitalize on the rapid expansion of legalized sports betting across the United States. Initially, the platform was limited to a handful of states and relied on third‑party technology providers to handle wagering mechanics and regulatory compliance. Over the next few years, ESPN Bet grew its footprint to 25 states, building a loyal user base among younger sports fans who were already comfortable with streaming ESPN content on mobile devices. Despite this growth, the platform remained largely opaque to advertisers and partners, and its revenue was capped by the need to outsource much of its backend operations.
Why DraftKings?
DraftKings has long been a dominant force in sports betting, with a user‑friendly mobile app and a vast network of licensed partners across more than 30 states. DraftKings’ strength lies not only in its betting marketplace but also in its data analytics capabilities, customer loyalty programs, and marketing muscle. By aligning with DraftKings, ESPN Bet can leverage these assets while also expanding its own brand presence into new markets.
DraftKings’ CEO Kevin Plank highlighted in a joint statement that the partnership “will allow us to merge the best of our sports‑betting expertise with ESPN’s unparalleled access to live sports content and passionate fan communities.” ESPN’s senior vice‑president of digital, Matt Ritchie, echoed this sentiment, noting that the collaboration would “enable us to deliver the most engaging, contextual betting experiences directly to our audience.”
Deal Mechanics
The partnership is structured as a revenue‑sharing arrangement. DraftKings will provide the underlying betting engine and regulatory support, while ESPN will retain the right to brand the platform as “ESPN Bet” and integrate betting widgets directly into its app, website, and over‑the‑top (OTT) services. The agreement grants DraftKings exclusivity in all states where ESPN Bet currently operates, a clause that is expected to give both parties a competitive advantage over rivals such as FanDuel, Fanatics, and the emerging “ESPN Sportsbook” platform being developed by a consortium of sports media companies.
According to leaked financial data from the Variety article, the deal is estimated to be worth up to $300 million over five years, although the exact figure was not disclosed. DraftKings will receive a base fee of $70 million plus a performance‑based bonus that will be triggered once ESPN Bet reaches 5 million active users and $500 million in total wagers. In return, ESPN will receive a 40 % share of net wagering revenue generated through its branded interface.
Integration and User Experience
The integration will be phased, with the first rollout slated for Q3 2025. Early adopters in states such as New York, Ohio, and Virginia will see an “ESPN Bet” section within the ESPN app that offers live betting, in‑game overlays, and personalized odds updates. The new interface will also feature “ESPN Play” – a series of short‑form video segments that explain betting concepts and provide odds analysis, designed to engage younger viewers who may be new to sports wagering.
The article’s accompanying infographic outlines how the partnership will work across the tech stack: ESPN’s existing user data will feed into DraftKings’ advanced analytics engine to create hyper‑personalized betting offers. Meanwhile, DraftKings’ payment processing system will be integrated with ESPN’s existing subscription infrastructure, allowing users to bet using credit cards, e‑wallets, or the ESPN‑backed “ESPN Wallet” feature.
Regulatory and Competitive Landscape
One of the most significant aspects of the deal is the regulatory framework. Both ESPN and DraftKings have a track record of compliance, but the partnership will necessitate close coordination with state gaming commissions to ensure that betting offers are tailored to each state’s laws. The article notes that the deal will include a dedicated compliance team that will work on a state‑by‑state basis to manage licensing, tax obligations, and responsible‑gaming requirements.
The partnership also reflects broader industry trends. With the U.S. Supreme Court’s 2021 decision to strike down the federal Sports Betting Promotion Act, states have been scrambling to secure licenses. The ESPN‑DraftKings partnership is seen as a strategic move to streamline the licensing process by combining a media powerhouse with a seasoned betting operator. Industry analysts predict that the partnership could spur a wave of similar collaborations between sports media outlets and betting companies.
Additional Context from Linked Articles
The Variety piece linked to DraftKings’ official press release, which announced a “new era of sports betting” and detailed the company’s investment in mobile technologies and data analytics. The press release highlighted DraftKings’ acquisition of several boutique betting startups, including a predictive analytics firm that has developed machine‑learning models to forecast player performance. This technology will be integrated into ESPN Bet’s live‑game overlays, providing users with real‑time, data‑driven insights.
Another link in the article directed readers to a recent interview with ESPN’s head of sports betting, which emphasized the importance of “trust and transparency” in betting. The interview noted that ESPN Bet’s new partnership will allow the company to offer clearer odds and better risk‑management tools to its users, addressing long‑standing concerns about wagering fairness.
Looking Ahead
The ESPN‑DraftKings deal represents a significant consolidation in the U.S. sports betting market. By combining ESPN’s content dominance and fan engagement with DraftKings’ betting infrastructure and regulatory prowess, the partnership aims to create a seamless, high‑value experience for sports fans across the country.
As the deal progresses, industry observers will be watching closely to see how the partnership impacts betting volume, user acquisition costs, and overall market share. In particular, the performance of ESPN Bet in states where it has historically struggled to compete with FanDuel and Fanatics will serve as a bellwether for the viability of media‑centric betting models. Whether the partnership can achieve the projected $500 million in wagers by the end of its first year remains to be seen, but the alignment of two industry giants suggests a new era of innovation and competition in the U.S. sports betting landscape.
Read the Full Variety Article at:
[ https://variety.com/2025/digital/news/espn-bet-draftkings-deal-1236571246/ ]
