Disney Owns Fox’s Stake in DraftKings After Hollywood Buyout
After several public comments from Disney executives that the company would never enter the sports betting operator industry, reports have surfaced that ESPN’s parent company owns a stake in DraftKings.
Disney acquired Fox’s stake in the sports betting company with their recent $71.3 billion dollar takeover of the media conglomerate.
The news that Disney owns a part of a sports betting operator flies directly in the face of CEO Bob Iger’s statement to shareholders on May 8th.
At that time, Iger said,
“We’ve already done some things that we would integrate it into our programming, but not to the extent that we would be facilitating gambling as an entity.”
“In other words, we’ll provide programming that will, I guess, be designed to enlighten people who are betting on sports. But that’s as far as we would go.”
ESPN recently entered into a partnership with Caesars Entertainment, but that was for the betting company to provide odds and information for the sports network programming.
In addition to the information Caesars will provide, ESPN plans to build a studio in the company LINQ Hotel & Casino property on the Las Vegas Strip.
ESPN will run a daily show from the LINQ studio called “Daily Wager” that provides betting analysis and the latest odds for bettors.
There was speculation among media experts that Fox had sold the DraftKings stake to Sinclair when they unloaded 21 regional sports networks after the Disney sale.
But those reports have come apart in the face of the news of Disney’s hold of the DraftKings stake.
What is Next for DraftKings Under Disney?
Certainly the news that Disney owns a stake in DraftKings after the Iger comments leave many wondering what the home to Mickey Mouse has in store for the gambling operator.
Although Disney and DraftKings have flirted for several years, Iger’s comments to shareholders could possibly mean that the stake will soon be up for sale.
But that possibility is potentially clouded by past rumors of a partnership between the two companies.
In 2015, there were reports that Disney invested $250 million in the betting company but those stories were later proven untrue.
DraftKings’ entry into states as an online provider and name recognition could be a valuable asset for Disney, especially if paired with ESPN.
Adding another interesting wrinkle to this mystery is the fact that DraftKings and Caesars Entertainment entered into their own partnership back in February.
The agreement calls for a multi-state partnership where DraftKings is given market access to online products in casinos that are run by Caesars.
Essentially, DraftKings could provide the app for Caesars casinos where the states require a brick and mortar location before they’ll allow mobile betting from the same establishment.
With ESPN and Caesars’ agreement, could the DraftKings partnership become a three-party enterprise?
Another factor that could push Iger to reverse his position comes with the news that Fox Sports will create an app for sports betting called FOX Bet.
The app will integrate with Fox Sports programming to allow the network to offer 24/7 betting news on mobile devices and the company’s sports networks.
With more states legalizing sports betting each year, Disney may discover they are too tempted to pass on millions in possible revenue that Fox could monopolize.