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Casino Company Buys $163 Million Stake in Barstool Sports

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  • Casino operator Penn National Gaming agreed to buy a minority stake in Barstool Sports for $163 million, a deal that now values the popular sports and pop culture blog at $450 million.
  • Since sports gambling was legalized in 2018, media and gambling companies have been rushing to enter the market. 
  • By combining their forces, media companies get access to revenue streams outside of advertising, while gambling companies get access to new consumers and a broader reach.
  • While some believe this model will spread, others note that Barstool has a unique following and ability to monetize its audience that sets it apart from others.

Penn National Buys Barstool Stake

Casino operator Penn National Gaming announced Wednesday that it bought a $163 Million stake in sports pop culture blog Barstool Sports, valuing the media company at $450 million.

In a press release, Penn National said that they had acquired a 36% stake in Barstool, adding that in three years the casino operator will “increase its ownership to approximately 50% with an incremental investment of approximately $62 million.”

Penn National will now be the “exclusive gaming partner” of Barstool for “up to 40 years,” according to the press release. 

Penn National will also have “the sole right to utilize the Barstool Sports brand for all of the Company’s online and retail sports betting and iCasino products.” 

Barstool founder Dave Portnoy separately announced the deal in a video on Twitter, where he talked about how he started Barstool as a “gambling rag” 17 years ago, and how the company has a deep history connected to gambling.

“We just needed a company with a shared vision,” he said. “That vision is Penn National Gaming. They have one of the biggest infrastructures in the country for gambling. They have sports tracks, they have casinos, they’re all over the country.”

“They have the infrastructure, we have this rabid audience, this fan base craving it,” Portnoy added. 

“Together, we’re going to create an omnipresent approach to gambling, on-premise, off-premise: Barstool casinos, bars, pizza places, you name it, we’re going to build it. All fueled by the Barstool media engine.” 

Win-Win for Media and Gambling Companies

The deal is a significant step for Barstool and Penn National, but it is also representative of a broader change in the gambling industry. 

In 2018, the Supreme Court ruled that sports gambling was legal in the U.S., giving individual states the power to decide if they wanted to legalize. 

According to the Wall Street Journal, 20 states and DC have legalized sports gambling. While some of those states only allow it to take place in casinos, others do permit online betting.

Since the decision, there has been a rush by both the gambling industry and media companies to capitalize on that new market, specifically when it comes to online gambling.

Those efforts have proven to be incredibly lucrative. According to the American Gaming Association, gamblers have placed $15.8 billion in sports bets and generated $1.1 billion in revenue for sportsbooks since the Supreme Court ruling.

Online betting has been the most profitable in states where it is allowed like New Jersey, where nearly 84% of the $4.58 billion the state brought in from sports wagers last year came from online bets, according to the Journal

The thing that is so unique about this market is that media and gambling companies do not have to be competitors. When companies like Penn National and Barstool combine their resources, both benefit.

Working jointly is good for companies like Barstool because digital-media companies primarily depend on advertising revenue. But combing forces with a gambling industry giant allows them to diversify their revenue streams.

It is also beneficial for big gambling operations like Penn National because media companies give them access to their large, young audience.

For example, Barstool sports has 66 million monthly unique visitors. By pairing with a popular company like Barstool, Penn National— which is very lucrative but not very well known— can grow its profile nationally while simultaneously cutting down on costs.

This saves gambling companies money because attracting new customers through normal means like advertising Facebook and Google can be expensive.

According to filings from the sports betting company DraftKings, the company paid an average of $406 for each new customer acquired in New Jersey in the first half of 2019. 

Future of Sports Gambling

While some predict that this model will be used for other media and gambling company pair-ups in the future, others are not so sure.

In an article for Forbes, writer Daniel Marcus argued that from the get-go, Barstool, “has been willing to leverage its’ rabid and loyal fan base into other revenue opportunities outside of the traditional advertising model.”

Marcus notes that Portnoy has always mobilized Barstool’s fans in a unique way, like through selling merchandise and convincing fans to actually buy that merchandise in a way other companies have not.

He also said that while other media companies have leaned into premium subscription models, Barstool has always supported growth without doing so.

“For those assuming this deal will trigger some sort of domino effect that will benefit the other sports media entities that are currently in play, I wouldn’t count on it, as few of them have proven they are able to effectively monetize their audiences beyond advertising,” he wrote.

While Portnoy has been effective at reaching his fans, he has also been a controversial figure. In August, he came under fire after he threatened to fire Barstool employees who talked to union activists in a series of tweets.

He was later forced to remove the tweets in a settlement with the National Labor Relations Board.  

See what others are saying: (The Wall Street Journal) (Forbes) (Business Insider)

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Meta Reinstates Trump on Facebook and Instagram

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The company, which banned the former president two years ago for his role in inciting the Jan. 6 insurrection, now says the risk to public safety has “sufficiently receded.” 


Meta Ends Suspension

Meta announced Wednesday that it will reinstate the Facebook and Instagram accounts of former President Donald Trump, just two years after he was banned for using the platforms to incite a violent insurrection.

In a blog post, the company said the suspensions would be lifted “in the coming weeks” but with “new guardrails in place to deter repeat offenses.”

Specifically, Meta stated that due to Trump’s violations of its Community Standards, he will face “heightened penalties for repeat offenses” under new protocols for “public figures whose accounts are reinstated from suspensions related to civil unrest.”

“In the event that Mr. Trump posts further violating content, the content will be removed and he will be suspended for between one month and two years, depending on the severity of the violation,” the blog post continued.

The company also noted its updated protocols address content that doesn’t violate its Community Standards but “contributes to the sort of risk that materialized on January 6, such as content that delegitimizes an upcoming election or is related to QAnon.”

However, unlike direct violations, that content would have its distribution limited, but it would not be taken down. As a penalty for repeat offenses, Meta says it “may temporarily restrict access to […] advertising tools.”

As far as why the company is doing this, it explained that it assessed whether or not to extend the “unprecedented” two-year suspension it placed on Trump back in January of 2021 and determined that the risk to public safety had “sufficiently receded.”

Meta also argued that social media is “rooted in the belief that open debate and the free flow of ideas are important values” and it does not want to “get in the way of open, public and democratic debate.”

“The public should be able to hear what their politicians are saying — the good, the bad and the ugly — so that they can make informed choices at the ballot box,” the tech giant added.

Response

Meta’s decision prompted widespread backlash from many people who argue the former president has clearly not learned from the past because he continues to share lies about the election, conspiracy theories, and other incendiary language on Truth Social.

“Trump incited an insurrection. And tried to stop the peaceful transfer of power,” Rep. Adam Schiff (D-Ca.) tweeted. “He’s shown no remorse. No contrition. Giving him back access to a social media platform to spread his lies and demagoguery is dangerous. @facebook caved, giving him a platform to do more harm.”

According to estimates last month by the advocacy groups Accountable Tech and Media Matters for America, over 350 of Trump’s posts on the platform would have explicitly violated Facebook’s policies against QAnon content, election claims, and harassment of marginalized groups.

“Mark Zuckerberg’s decision to reinstate Trump’s accounts is a prime example of putting profits above people’s safety,”  NAACP President Derrick Johnson told NPR

“It’s quite astonishing that one can spew hatred, fuel conspiracies, and incite a violent insurrection at our nation’s Capitol building, and Mark Zuckerberg still believes that is not enough to remove someone from his platforms.”

However, on the other side, many conservatives and Trump supporters have cheered the move as a win for free speech.

Others, like Rep. Jim Jordan (R-Oh.) also asserted that Trump “shouldn’t have been banned in the first place. Can’t happen again.”

Trump himself echoed that point on in a post on Truth Social, where he claimed Facebook has lost billions of dollars both removing and reinstating him.

Such a thing should never again happen to a sitting President, or anybody else who is not deserving of retribution! THANK YOU TO TRUTH SOCIAL FOR DOING SUCH AN INCREDIBLE JOB. YOUR GROWTH IS OUTSTANDING, AND FUTURE UNLIMITED!!!” he continued. 

The question that remains, however, is whether Trump will actually go back to Facebook or Instagram. As many have noted, the two were never his main platforms. Twitter was always been his preferred outlet, and while Elon Musk reinstated his account some time ago, he has not been posting on the site.

There is also the question of how Truth Social — which Trump created and put millions of dollars into — would survive if he went back to Meta’s platforms. The company is already struggling financially, and as Axios notes, if Trump moves back, it signals to investors that he is not confident in the company.

On the other hand, Trump’s lawyers formally petitioned Meta to reinstate him, which could indicate that this goes beyond just a symbolic win and is something he actually wants. Additionally, if he were to start engaging on Facebook and Instagram again, it would immediately give him access to his over 57 million followers across the two platforms while he continues his 2024 presidential campaign.

See what others are saying: (NPR) (Axios) (The New York Times)

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Meta Encouraged to Change Nudity Policy in Potential Win For Free The Nipple Movement

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The company’s oversight board said Meta’s current rules are too confusing to follow, and new guidelines should be developed to “respect international human rights standards.”


Rules Based in “A Binary View of Gender”

In a move many have described as a big step for Free The Nipple advocates, Meta’s oversight board released a decision Tuesday encouraging the company to modify its nudity and sexual activity policies so that social media users are treated “without discrimination on the basis of sex or gender.”

The board—which consists of lawyers, journalists, and academics—said the parent company of Facebook and Instagram should change its guidelines “so that it is governed by clear criteria that respect international human rights standards.”

Its decision came after a transgender and nonbinary couple had two different posts removed for alleged violations of Meta’s Sexual Solicitation Community Standard. Both posts included images of the couple bare-chested with their nipples covered along with captions discussing transgender healthcare, as they were fundraising for one of them to undergo top surgery.

Both posts, one from 2021 and another from 2022, were taken down after users reported it and Meta’s own automated system flagged it. The posts were restored after an appeal, but the oversight board stated that their initial removal highlights faults in the company’s policies. 

“Removing these posts is not in line with Meta’s Community Standards, values or human rights responsibilities,” the board said in its decision, 

According to the board, Meta’s sexual solicitation policy is too broad and creates confusion for social media users. The board also said the policy is “based on a binary view of gender and a distinction between male and female bodies.

“Such an approach makes it unclear how the rules apply to intersex, non-binary and transgender people, and requires reviewers to make rapid and subjective assessments of sex and gender, which is not practical when moderating content at scale,” the decision continued. 

Free the Nipple Movement

The board stated that the rules get especially confusing regarding female nipples, “particularly as they apply to transgender and non-binary people.”

While there are exceptions to Meta’s rules, including posts in medical or health contexts, the board said that these exceptions are “often convoluted and poorly defined.” 

“The lack of clarity inherent in this policy creates uncertainty for users and reviewers, and makes it unworkable in practice,” the decision said. 

The board’s recommended that Meta change how it manages nudity on its platforms. The group also requested that Meta provide more details regarding what content specifically violates its Sexual Solicitation Community Standard. 

For over a decade, Meta’s nudity policies have been condemned by many activists and users for strictly censoring female bodies. The Free the Nipple movement was created to combat rules that prevent users from sharing images of a bare female chest, but still allow men to freely post topless photos of themselves. 

Big names including Rihanna, Miley Cyrus, and Florence Pugh have advocated for Free the Nipple.
Meta now has 60 days to respond to the board’s recommendations. In a statement to the New York Post, a spokesperson for the company said Meta is “constantly evaluating our policies to help make our platforms safer for everyone.”

See What Others Are Saying: (Mashable) (The New York Post) (Oversight Committee Decision)

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Amazon Labor Union Receives Official Union Certification

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The company already plans to appeal the decision.


Amazon Labor Union’s Victory 

The National Labor Relations Board on Wednesday certified the Amazon Labor Union (ALU) Staten Island election from April, despite Amazon’s objections. 

After Staten Island staffers won the vote to unionize by 500 votes in the spring of 2022, Amazon quickly filed a slew of objections, claiming that the ALU had improperly influenced the election. Amazon pushed for the results to be overturned. 

Now, the National Labor Relations Board has dismissed Amazon’s allegations and certified the election. This certification gives legitimacy to the ALU and puts Amazon in a position to be penalized should they decide not to bargain with the union in good faith. 

“We’re demanding that Amazon now, after certification, meet and bargain with us,” ALU attorney Seth Goldstein said to Motherboard regarding the certification. “We’re demanding bargaining, and if we need to, we’re going to move to get a court order enforcing our bargaining rights. It’s outrageous that they’ve been violating federal labor while they continue to do so.”

Negotiate or Appeal 

Amazon has until Jan. 25 to begin bargaining with the ALU, or the online retailer can appeal the decision by the same deadline. The company has already announced its plan to appeal. 

“As we’ve said since the beginning, we don’t believe this election process was fair, legitimate, or representative of the majority of what our team wants,” Amazon spokesperson Kelly Nantel, said in a statement.

This win comes after two recent defeats in ALU’s unionization efforts. The union lost an election at a facility in Albany and another in Staten Island. 

ALU’s director Chris Smalls told Yahoo! Finance that he is unconcerned about these losses.

“For us, whatever campaign is ready to go, the Amazon Labor Union is going to throw their support behind it, no matter what…We know that it’s going to take collective action for Amazon to come to the table,” he told the outlet. “So, for us, it’s never unsuccessful. These are growing pains, and we’re going to fight and continue to grow.”

See what others are saying: (Vice) (NPR) (Bloomberg)

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