ESPN Bet has received approval from the New York State Gaming Commission (NYSGC) to launch an online sportsbook in the state, marking its entry into the country’s biggest online sports betting market. The approval allows ESPN Bet to go live in the coming days, following the transfer of WynnBET’s license to the Penn Interactive-operated brand.
Back in February, ESPN Bet announced that it would pay Wynn $25 million for the license, and the deal was completed a few months later. However, the state gambling regulator did not give its approval until this week, despite ESPN Bet hoping to be live in time for the start of the football season. The NYSGC had not met since June and was not willing to hold a special session to decide on the matter.
The reason ESPN Bet had to acquire Wynn’s license was due to the cap of nine online betting licenses in the state, with operators controlling each of them. WynnBET eventually gave up trying to compete and closed its sportsbooks. This marks only the second time a new operator has entered the fold, with the other being when Fanatics took over PointsBet.
Penn Interactive Executive Vice President Chris Rogers revealed that the company has some minor technology matters to address but intends to go live in the coming days, potentially with a soft launch before the weekend’s NFL action. Professional football is a significant business for operators, especially in New York, where there are three local teams to support.
Despite the positive news of accessing the New York market, ESPN Bet has faced challenges since its launch. Penn began running ESPN Bet after entering a ten-year agreement in August 2023 for $2 billion and is live in 19 states. However, the brand only controls about 2.8% of the overall market, struggling to compete with dominant players like DraftKings and FanDuel. ESPN Bet originally aimed to have a 20% market share by 2027.
Penn itself has faced scrutiny from investors as its share price has plummeted in recent years. Some shareholders have called for the sale of the company and questioned the CEO’s $100 million compensation. In response to market challenges, Penn announced a fresh round of layoffs in July, affecting employees in the sports betting and iGaming divisions. The layoffs were intended to streamline reporting lines, enhance operational efficiencies, and leverage shared resources.
Despite these challenges, ESPN Bet is now set to launch in the New York market, tapping into a lucrative online sports betting market. With approval from the NYSGC, the brand is poised to compete with other operators in the state and potentially gain a larger market share in the coming years.