DraftKings ramps up media spree with $50m podcast investment

DraftKings will further invest in its newly formed media business via a distribution deal with former ESPN host Dan Le Batard worth at least $50m over three years, the WSJ has reported.

Le Batard’s podcast will be sub-licensed to radio stations and other streaming platforms as DraftKings also seeks to make money from selling advertising.

The podcast, which averages 10-12 million monthly downloads, will also feature DraftKings odds and betting and DFS stats provided by the operator.

DraftKings established its media business arm after acquiring Las Vegas-headquartered sports betting broadcaster and content platform VSiN in March.

The Boston-based operator subsequently appointed former Verizon SVP of corporate strategy and chief business officer Brian Angiolet to the new role of chief media officer to build its long-term media strategy.

Industry consultant and investor David VanEgmond recently told EGR North America he expected to see more deep investment into content creators.

“If you look at what FanDuel, DraftKings, and BetMGM are likely to spend on marketing this year, it wouldn’t shock me if all three spent $500m+ in 2021 and by 2022 they are probably looking at closer to a billion dollars each,” VanEgmond said.

“So, to spend $100m or $200m now on an acquisition that can help you own content for the next decade and reduce your customer acquisition cost, I think that’s an interesting strategy and probably a winning one to help fortify the moat against these smaller market share players,” he added.

Equity analysts Needham assigned a Buy rating and price target of $81 to DraftKings this week after commencing coverage on the operator.

“We see DKNG as a leader in the emerging North America online gambling market, which is a $35bn market opportunity,” Needham analyst Bernie McTernan said.

DraftKings’ shares stood at $58.44 at the time of writing, down from the all-time high of $74 in March.