top of page
  • Writer's pictureRyan Magill

ESPN/PENN Entertainment Deal: How Missing Transparency Could Mean Market Manipulation

Updated: Jan 13

On August 8, 2023, ESPN and PENN Entertainment (“PENN”) announced a 10-year, $2 billion exclusive “deep integration” partnership.[2] Headlined by ESPN’s first-ever branded sportsbook, ESPN Bet, the deal marks the most important chapter in the increasingly interwoven story of sports media and gambling since the Supreme Court re-legalized sports gambling in 2018.[3] Despite the benefits for both parties, there remains a legitimate question of how ESPN’s journalistic integrity could be affected by PENN and ESPN Bet’s financial structure relying on people betting wrong. Without transparent and concrete answers, sports fans should be concerned that their trust could be manipulated for profit.

The Benefits of Working Together

The sports gambling landscape is currently dominated by DraftKings and FanDuel, the first two major companies in the industry.[4] This practical duopoly boasts an estimated 85% of online sports gamblers using their sites on a monthly basis.[5] For PENN, the operators of 43 casinos throughout North America, breaking into the competitive sportsbook business requires a unique edge over the competition.[6]

PENN’s first attempt to gain an edge was by purchasing a 36% stake in Barstool Sports in January 2020 for $163 million, before buying the whole company in February 2023 for an additional $388 million.[7] Despite launching the Barstool Sportsbook app together, Barstool Sports founder Dave Portnoy explained in a video that Barstool’s content and brand identity were routinely flagged by state gambling regulators, which cost PENN opportunities to obtain sports gambling licenses.[8]

With interests proving to be too conflicting, PENN agreed to sell Barstool Sports back to Portnoy for $1 (plus 50% of gross proceeds of any future sale of the brand and certain non-compete clauses) and shifted focus to a new partnership with ESPN.[9] PENN’s belief in the ESPN partnership extends beyond the $2 billion investment, as PENN’s 10-Q report to the SEC explained how the sale of Barstool back to Dave Portnoy would be a “pre-tax non-cash loss ... estimated to be between $800.0 million and $850.0 million (inclusive of $705.0 million to $720.0 million in goodwill and intangible assets write-offs) to be incurred in the third quarter of 2023.”[10] While the Barstool Sports ownership stint did not bridge the gap, it led PENN to negotiate with ESPN.[11] Now, with unrivaled promotional access through the most engaging sports media and entertainment company in the nation, PENN might rival the duopoly within the lifetime of its new deal.[12]

For PENN, ESPN’s historically trusted brand brings significant engagement numbers to the new ESPN Bet sportsbook. For ESPN, increasing production costs and declining advertising revenue recently forced ESPN to lay off employees and explore a possible sale of minority ownership to ensure profitability.[13] However, PENN’s $2 billion offer is certainly helpful to ESPN’s current financial situation. Moreover, consumer statistics show just how much more financially engaged and interactive the average betting sports fans are as opposed to the average non-betting fans.[14] Thus, the long-term prospects of PENN’s investment and transformation of Barstool Sportsbook into ESPN Bet capitalizes on gambling fans’ increased financial engagement and may be the perfect lifeline for ESPN.

The Concerns about Partnering

For example, just two hours before the 2023 NBA Draft, respected NBA writer for The Athletic and “FanDuel Partner” Shams Charania shocked his two million Twitter/X followers (and nearly ten million users who saw the tweet) with the following statement:

Before the tweet, Miller was the betting-odds favorite over Henderson for weeks. But after the tweet, fans placed enough bets on FanDuel (and other sportsbooks) that Henderson became the new favorite when the pick was being announced. However, despite Charania’s “sources,” Miller was drafted second overall. And while FanDuel was cashing in on an eleventh-hour flurry of wrong bets, people noticed the “FanDuel Partner” in Charania’s Twitter bio.

Allegations quickly arose that FanDuel used Charania to manipulate his trust and following for its financial gain. In the backlash, FanDuel stated it is not involved in Charania’s tweets.[16] Whether or not manipulation occurred, this demonstrates how much influence just one reporter can have on sportsbooks.

Hypothetically, how much money could ESPN Bet make if ESPN used its army of respected reporters to manipulate the odds on its own sportsbook? Now that ESPN and PENN’s bottom lines are inextricably linked, at a time when ESPN needs money, how will audiences know that PENN and ESPN will never deceive them?

Next Steps and Considerations

Similarly to FanDuel, ESPN issued the following in a statement after announcing the PENN deal:

“In concert with PENN Entertainment’s comprehensive responsible gaming programming, ESPN will use its platforms to educate sports fans on responsible gaming, including but not limited to:

  • Continuing ESPN’s high standard of journalistic integrity when covering the sports betting space.

  • Developing an ESPN committee of responsible gaming, representative of a diverse cross-section of the business, to regularly review compliance, programming, and policies.

  • Implementing responsible marketing policies and guidelines to safeguard fans.

  • Working with industry experts on best practices and continual review of responsible gaming programming.”[17]

Billion-dollar partnerships are not agreed to without deliberation. ESPN and PENN are rightfully aware of the potential for scandal. As such, Massachusetts state gambling regulators have already met with PENN to discuss the changes, which included PENN’s assurance that ESPN will not have a role in any sportsbook operation, other than the named partnership and branding.[18]

However, plenty of questions still remain. Which experts will be consulted? Who will be on the internal committee? What policies will be implemented? Most importantly, how will ESPN safeguard its high journalistic standard from potential interference? These are questions other publications have raised.[19] [20] Yet, neither ESPN nor PENN have answered or said if or when they plan to provide answers.

Another recent example of potential blurred lines occurred on October 9, 2023, when ESPN sportscaster Matt Barrie criticized Ohio State football’s head coach Ryan Day for kicking “a meaningless field goal to go up 20.”[21] He emphasized that the “spread was 19 1/2.” and “[f]or those of us that were on Maryland plus the points, that was a real backbreaker.”[22] Importantly to note, Matt Barrie’s show is not a gambling-specific show, which raises the question of why he felt the need to criticize Ryan Day for messing up his bet at all.

The occasional prop betters, the weekly parlay fanatics, and even sports fans who do not gamble should be very concerned about the kind of mass manipulation that is more possible than ever before. For a company priding itself on its journalistic integrity, ESPN must do a better job of communicating its plans. Until they do, watch and bet at your own risk.


[2] Penn Entertainment. PENN Entertainment and ESPN Enter into Long-Term Exclusive Strategic Alliance for U.S. Online Sports Betting (Aug. 8, 2023) [3] Adam Liptak & Kevin Draper. Supreme Court Ruling Favors Sports Betting (May 14, 2018) [4] Gavin Bridge. FanDuel and DraftKings Dominate Online Sportsbook Use (Jan. 11, 2023) [5]Id. [6] “Our Brands.” Our Brands | PENN Entertainment, Accessed 16 Oct. 2023. [7] “Penn Entertainment Completes Acquisition of Barstool Sports.” PENN Entertainment, 17 Feb. 2023, [8] Spangler, Todd. “Dave Portnoy Paid $1 (Yes, One Dollar) to Buy Barstool Sports Back from Penn, Which Will Take up to $850 Million Charge Related to Disposal of the Business.” Variety, Variety, 11 Aug. 2023, [9] Id. [10] PENN Entertainment, Inc., FY23-Q3 Form 10-Q for the Period Ending June 30, 2023 (filed August 9, 2023), from SEC website, [11] Kellen Browning. ESPN Enters Sports Gambling in $2 Billion Deal With Casino Company. (Aug. 8, 2023) [12] Shareable. Leading sports media companies in the United States on social media in 2020, by user engagement (Feb. 2021),the%20U.S.%202020%2C%20by%20actions&text=In%202020%2C%20ESPN%20was%20the,actions%20on%20brand%2Downed%20content. [13] Browning, supra. [14] Pete Giorgio, Brooke Auxier, Kat Harwood, David Jarvis, Hannah Bobich. 2023 sports fan insights: The beginning of the immersive sports era. (Jun. 15, 2023) [15] Shams Charania. Sources: Scoot Henderson is gaining serious momentum at No. 2 with the Charlotte Hornets in tonight’s NBA draft. Hornets have been torn over the last week between Henderson and Brandon Miller. Team has final meetings today to settle on decision. (Jun 22, 2023) [16] Frankie Taddeo. FanDuel Shares Statement on Shams Charania NBA Draft Report Controversy. (Jun 23. 2023) [17] John R. Manzo. ESPN to Launch ESPN BET in a New Agreement with PENN Entertainment. (Aug 8, 2023) [18] Dorson, Jill R. “Penn: Tech Won’t Change, ESPN Strictly a Marketing Partner.” SportsHandle, 2 Oct. 2023, Accessed 16 Oct. 2023. [19] Tom Jones. Opinion | Would ESPN embrace gambling? You can bet on it. (Aug 9, 2023) [20] William Skipworth. ESPN Gambling Deal Faces Criticisms Of Conflict Of Interest. (Aug 9, 2023) [21] Williams, Madison. “ESPN’s Matt Barrie: Ohio State’s Ryan Day ‘Ought to Be Ashamed’ Despite ...” Sports Illustrated, 9 Oct. 2023, [22] Id.

Recent Posts

See All

Is the Sport of Boxing on the Ropes?

Boxing was once a well-respected sport filled with household names such as Sugar Ray Leonard, Muhammad Ali, Mike Tyson, and Floyd Mayweather Jr.[2] Crowned Heavyweight Champions were admired for their


bottom of page