Bittersweet Victory: DraftKings Reaches Deal With ESPN Without Any Equity Investment
On Wednesday, June 24, fantasy sports company DraftKings Inc. reached a promotional partnership with ESPN. DraftKings had reportedly been in talks with Walt Disney Co., ESPN’s parent company, for an equity investment earlier this year. According to the reports from April, Disney was close to investing $250 million into DraftKings, an amount that would value the company at roughly $900 million.
Although neither company would discuss how much the ESPN marketing deal was actually worth, the agreement makes DraftKings the “official fantasy sports offering” on ESPN’s platforms. This will ultimately help DraftKings compete with its largest competitor in the daily fantasy sports market, FanDuel Inc.
Additionally, the partnership with DraftKings should help ESPN compete with Yahoo. Though more than 12 million people already play ESPN’s online fantasy sports games, Yahoo also operates popular fantasy leagues and announced in April that it planned a new daily fantasy sports option that should launch this summer.