Posted on: March 10, 2023, 12:48h.
Last updated on: March 10, 2023, 03:24h.
Walt Disney (NYSE: DIS) CEO Bob Iger said there are pathways for the entertainment behemoth to get involved in sports wagering, though he prefers a measured approach. They were his clearest comments on the subject since returning to the helm of the company,
Speaking Thursday at the Morgan Stanley Technology, Media and Telecom Conference, Iger noted that Disney expanding its sports betting footprint is important, particularly when attracting young consumers.
I mentioned earlier in another meeting I have two sons who are 24 and 20, and it’s not just about fantasy sports, but they’re interested in it,” said Iger. “And I prefer to wait as long as possible. But when I think about them, I think it’s inevitable that there’ll be basically a seamlessness between sports programming and sports betting.”
Iger, who previously served as Disney’s CEO from 2005 to 2020, returned to that role last November, replacing Bob Chapek. That stoked a flurry of speculation regarding the company’s plans to expand or reduce its focus on sports wagering.
ESPN Integral to Disney Sports Wagering Plans
At the Morgan Stanley conference, Iger acknowledged that sports wagering was a subject of interest for Chapek. Conversely, Hollywood and Wall Street widely believe that Iger is focusing on shoring up Disney’s movie and streaming entertainment content and its theme park business before turning attention to smaller matters, such as sports betting.
Still, Iger pointed out that Disney’s ESPN unit is the leading brand in sports broadcasting, ratings remain sturdy across that platform, and Disney sees value in sports.
In recent months, there’s been speculation that Disney could spin off the “worldwide leader in sports,” which would free up the sports media giant to more openly pursue sports wagering opportunities. Such a move wasn’t favored by Chapek. However, analysts speculate that given Iger’s preference for intellectual property and franchises such as Marvel — traits neither ABC nor ESPN possesses — the newly returned Disney boss could favor parting ways with the company’s news operations, including sports.
On the other hand — with more complex endeavors, such as improving movie content and making theme parks accessible to a broader swath of consumers high up on Iger’s near-term agenda — complex transactions such as spinning out the media unit could be delayed or not on the table at all.
Iger said he’s optimistic about ESPN going forward but added he’s “open-minded about its future.”
ESPN Sports Betting Avenues
Iger agrees with his predecessor that ESPN will not get into the business of directly accepting sports bets. But there are avenues the network can pursue to broaden its already significant sports wagering exposure.
For example, some market observers believe the Disney unit could benefit from DraftKings (NASDAQ: DKNG) potentially buying Caesars Entertainment (NASDAQ: CZR) from a marketing agreement with ESPN. Both gaming companies struck similar accords with ESPN in 2020. But with Caesars looking to reduce spending, DraftKings might look to pounce and become the network’s exclusive sportsbook partner.
ESPN has been mentioned as a possible buyer in what’s expected to be an active year of consolidation activity in the regulated sports wagering space. But those rumors can likely be put to rest because of Iger’s aforementioned full agenda of more critical issues.