FOX Sports is First Big Media Name to Release Sports Betting Product
FOX has entered into a partnership to launch a new online sports betting service called FOX Bet. This makes FOX the first big media brand to attach its name to sports betting since the Supreme Court overturned PASPA a year ago. FOX will soon debut a legal sports gambling product along with The Stars Group, a Canadian gambling company. Launching in the autumn of 2019 in states with regulated sports gambling, FOX Bet will offer two products: a real money wagering platform in states with legal sports gaming, and a free-to-play game.
About The Deal
In exchange for roughly five percent equity in The Stars Group, FOX will invest $236 million into the company. On FOX’s side, it will provide an exclusive license to The Stars Group to use certain FOX Sports trademarks for online sports wagering. As another part of the deal, FOX Sports may acquire up to 50 percent equity stake in The Stars Group’s business in the United States before the tenth anniversary of the agreement. Both parties agreed to a deal length of 25 years.
FOX Sports CEO Eric Shanks commented on the growing sports betting market:
“Digital sports wagering represents a growing market opportunity that allows us to diversify our revenue streams, connect directly with consumers and expand the reach of the FOX Sports brand.”
In a press release, the CEO of The Stars Group, Rafi Ashkenazi, commented on this groundbreaking deal:
“We believe this strategic partnership uniquely positions us to build a leading betting business in the U.S., which represents one of the most exciting long-term growth opportunities for our company.”
Sports Betting in the United States
In May 2018, the Supreme Court overturned PASPA, a 26-year-old federal law that banned sports betting outside of Nevada. Since the decision, seven more states have legalized sports betting.
To offer mobile sports gambling, companies have to attain licensing and become operational after legalization.
To date, big media companies that own the broadcast rights to sports, like Disney and Comcast, have kept out of the spotlight when it comes to sports betting. Keeping away from marketing branded products or fronting the business, Comcast has invested in FanDuel and Disney has talked about possibly investing in DraftKings.
When asked about Disney and sports gambling, CEO Bob Iger made the following statement:
“I don’t see The Walt Disney Company, certainly in the near term, getting involved in the business of gambling, in effect, by facilitating gambling in any way. Getting into the business of gambling, I rather doubt it.”
The Disney name might not be directly tied to sports betting, but that doesn’t mean one of their subsidiaries won’t be involved. Keep in mind, ESPN is owned by Disney and the global leader in sports has made a significant push toward covering sports betting within their online and on-air content.
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