ESPN Bet set to launch as New York regulator approves $25 million licensing deal

The New York State Gaming Commission (NYSGC) has approved the transfer of Wynn Resorts’ digital sports betting license to Penn Entertainment for $25 million, paving the way for the launch of ESPN Bet in the state. The approval allows Penn to bring ESPN Bet live in New York within days, possibly in time for NFL Week 4 games featuring local teams.

Penn Entertainment, which formed a partnership with ESPN in 2023, is expected to launch the platform through a soft rollout ahead of this weekend’s games. "We plan to launch in several days, perhaps a soft launch in advance of the weekend," said Chris Rogers, Penn's Executive Vice President and Chief Strategy Officer, during Monday’s NYSGC meeting.

New York, which caps its digital wagering licenses at nine, became available for ESPN Bet after WynnBet exited the market earlier this year. Wynn Resorts’ departure from the state in July opened a spot, which Penn secured for $25 million in a February deal. ESPN Bet is already operational in 19 states for sports betting and in five states for online casino gaming.

Rogers expressed confidence that ESPN Bet would grow the market rather than just shift existing bettors between platforms. “We attract a different kind of bettor. So we would expect to grow the market. I think we’ve seen handle on those markets (we launch in) go up, as people try a new platform,” Rogers noted.

During the hearing, NYSGC members raised concerns about ESPN Bet’s potential interactions with college-aged students, given ESPN’s heavy involvement in broadcasting college sports. Rogers reassured the commission that Penn Entertainment would adhere to strict guidelines, stating that the company takes it very seriously about not targeting underage people. "There are restrictions around college marketing, and our goal is to meet those standards,” Rogers said.

ESPN Bet is expected to make a significant impact on New York’s highly competitive sports betting market, which includes major players like FanDuel, DraftKings, Caesars Sportsbook, and BetMGM.

The ESPN Bet launch comes as Penn Entertainment seeks to capitalize on its growing iGaming portfolio, although the platform has faced early challenges. Penn posted an adjusted EBITDA loss of $196 million from its interactive business in Q1 2023, which includes ESPN Bet.