In this week’s edition of the GME3 we have a new challenger that’s looking to take the sports betting market by storm, as well as trouble with Meta in both Canada and the US. Read on for the full stories!
Gambling
ESPN Bets Big
Penn Entertainment has closed a $2 billion deal with the “worldwide leader in sports” – ESPN – to form ESPN Bet. ESPN Bet will be a sports betting service which will have direct integration with ESPN’s sports programming empire. Penn’s CEO Jay Snowden says the goal of the deal is to evolve Penn from a “pure-play U.S. regional gaming operator to a North American entertainment leader”.
At the same time, Penn has parted ways with Barstool Sports, a brand it only finished acquiring in February 2023. Penn attempted to use the Barstool branding in conjunction with their betting services, but quickly faced backlash over (controversial) Barstool founder Dave Portnoy’s blase attitude towards responsible gambling and history of recklessness. As of now, all of Penn’s stock in Barstool has been sold back to Portnoy.
Some are predicting that this unprecedented deal will bring more competition to the U.S. market which is currently being dominated by sports betting giants DraftKings and FanDuel. Those two operators alone control more than 70% of the American sports betting market. With a powerhouse brand like ESPN on board, it seems that ESPN Bet should have few issues cornering some market share, but whether or not it will grow big enough to challenge the incumbent brands remains to be seen.
Football fans can look forward to the upcoming NFL season, which just happens to coincide with ESPN Bet’s fall launch. It will be interesting to see whether this sports betting newcomer will be able to rise to the challenge.
Media
News Clash: Canada Unplugged
Canadian news broadcasters and publishers are calling on the Competition Bureau to step in and prevent Meta from blocking Canadian news content on its platforms. This is a result of the Canadian government passing Bill C-18 (The Online News Act), which forces new media conglomerates like Meta and Google to pay publishers for content they link to on their platforms. Meta has responded to this by removing Canadian news entirely
In a joint statement, the CBC, Canadian Association of Broadcasters, and News Media Canada have called this move “an abuse of [Meta’s] dominant position”. The ban has also been called anti-competitive, as it will prevent Canadian news companies from reaching advertising markets and reduce readership in general. This could cause serious damage to the Canadian news industry, a market which is already struggling in the age of new media.
However, Meta spokesperson Lisa Laventure responded by saying that “The only way we can reasonably comply with this legislation is to end news availability for people in Canada”.
Has the Canadian government overplayed their hand here? Taking on Meta using existing Canadian competition laws won’t be a simple task, and there’s no guarantee of success, but it’s heartening to see the government standing up for Canadian businesses. In the meantime, we’ll be taking bets on who will back down first.
Entertainment
Meta in Congress: Contempt Controversy
Meta isn’t only in trouble in Canada – the House Judiciary Committee has announced that they plan to cite Mark Zuckerberg with contempt of Congress regarding (what the Republican-led committee is calling) Meta’s non-compliance with an investigation into censorship allegations. The Committee is currently investigating whether the Biden administration colluded with tech and social media companies to suppress conservative voices.
The report claims that Zuckerberg and Meta have “willfully refused” to comply with a Congressional subpoena regarding the investigation into the actions of the Executive branch. It also alleges that Meta has “played a central role in this censorship scheme, frequently acquiescing and catering to the government’s censorship requests and demands.”
The Committee points to previously uncovered evidence that the Biden administration worked with Twitter to control the public conversation concerning COVID-19, including banning accounts spreading misinformation about vaccines. They argue that the same thing must have happened with Meta
Meanwhile, Meta has offered interviews with several key executives, on top of delivering over 53,000 pages of documents to investigators
While it’s unclear how this investigation will be resolved, or what impact it may have on social media in the future, it does raise some important questions. What role should government play in moderating online conversations? How much longer can social media exist in its current, largely unmoderated, state? We’ll be sure to keep an eye on this story as it evolves, so make sure to follow us on LinkedIn for future updates!
GME Law is Jack Tadman, Zack Pearlstein, Lindsay Anderson, and Will Sarwer-Foner Androsoff. Jack’s practice has focused exclusively on gaming law since he was an articling student in 2010, acting for the usual players in the gaming and quasi-gaming space. Zack joined Jack in September 2022. In addition to collaborating with Jack, and with a keen interest in privacy law, Zack brings a practice focused on issues unique to social media, influencer marketing, and video gaming. Lindsay is the most recent addition to the team, bringing her experience as a negotiator and contracts attorney, specializing in commercial technology, SaaS services, and data privacy.
At our firm, we are enthusiastic about aiding players in the gaming space, including sports leagues, media companies, advertisers, and more. Our specialized knowledge in these industries allows us to provide tailored solutions to our clients’ unique legal needs. Reach out to us HERE or contact Jack directly at jack@gmelawyers.com if you want to learn more!
Check out some of our previous editions of the GME3 HERE and HERE, and be sure to follow us on LinkedIn to be notified of new posts, keep up to date with industry news, and more!
