Why Major League Baseball Would Benefit From A Barstool Sports Partnership

Barstool Sports is in talks to land some Major League Baseball games through a broadcasting deal, according to the New York Post.

Here’s why it’s important and how it could change the streaming and sports betting industries.

What Happened: Barstool Sports, which is partially owned by Penn National Gaming PENN, would get coverage rights for mid-week MLB games.

A move by MLB could help the sport gain access to a younger audience. MLB’s Chief Revenue Officer Noah Garden has been vocal about alternative broadcasts and expanding the sports betting coverage, according to the Post report.

Barstool would be able to broadcast games across social media and their website and could work on integration inside their app.

If the games are non-exclusive, Barstool could take feeds from regional sports networks, including those owned by Sinclair Broadcast Group SBGI. One potential idea: the same broadcast aired on the regional network and on Barstool Sports. The alternate feed on Barstool Sports could feature personalities like Dave Portnoy and Dan (Big Cat) Katz and have a focus on the sports betting angle of things.

Why It's Important: “I believe this push is very serious and strategic," Roundhill Investments VP of Marketing Matias Dorta told Benzinga. "Barstool needs to play to their influencer roster and this potential broadcasting deal allows Barstool creators to engage with their audience in a unique way."

PENN shares are a holding in the Roundhill Sports Betting & iGaming ETF BETZ.

Sportico’s Eben Novy-Williams shares a similar sentiment on the unique personalities of Barstool making this a great deal.

“This is an area where Barstool and Penn National have a distinct advantage because not only is there a sportsbook product, but Barstool is already a huge media company with a young, rabid following," Novy-Williams said. "In the case of MLB, a sport with an aging fanbase, I’m not sure who needs who more."

MLB has national broadcast deals with Fox Corp FOX, Walt Disney Co DIS and AT&T T. ESPN dropped regular MLB game coverage during the week, which opened up a new broadcast opportunity.

YouTube, a unit of Alphabet Inc GOOG GOOGL, was mentioned as a possibility in the New York Post article given its broadcast of games for the past three years.

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What Else Is Happening: Barstool Sports has been pushing into additional media rights with the recently signed college football sponsorship and broadcast deal for the Arizona Bowl.

“Barstool recognizes the importance of acquiring the rights for live sports and is trying to become a media disruptor by displacing traditional media and linear broadcasting,” Roundhill Investments Vice President Mario Stefanidis told Benzinga.

The battle for sports rights continues to heat up with the entry of streaming companies paying large amounts for sports content.

“Streaming companies clearly realize the importance of acquiring sports rights as evidenced by the number and size of the deals that took place just this year,” Stefanidis said, noting the 11-year deal signed by Amazon.com AMZN for NFL Thursday Night Football games.

Sports betting companies could make a bigger push into streaming live sports. Dorta gives the edge to Barstool Sports thanks to their personalities.

“It is always going to be hard to compete with Barstool on this front as influencer content is the nature of their business.”

The broadcasting rights being mid-week MLB games and ones that weren’t being used by other media companies could be a win-win for MLB and Barstool and also come with less of a risk to the larger media companies.

“I don’t think this is a direct threat to major media brands like ESPN, Fox or NBC right now,” Novy-Williams said.

What’s Next: Barstool Sportsbook has seen a market share loss in states like Pennsylvania and Michigan. Dorta points to the company being in the early stages of “ironing out their entire sports betting offering.”

“I expect Barstool to do well in Arizona," he said. "The company has a year of trial and error under their belt and should be able to capitalize on the opportunity."

The MLB rights could be the first domino to fall in blurring the lines between sports betting companies and sports media, Novy-Williams says.

“In the macro sense, those legacy media companies all have to be aware of the blending of sports betting and sports media. We’ll see them get more involved in the coming months.”

PENN Price Action: Penn National shares closed down 1% to $71.06.