A New York Times story painting Barstool Sports founder and Massachusetts native Dave Portnoy as a “degenerate gambler” is causing angst for the Massachusetts Gaming Commission and affecting its review of PENN Entertainment.
The MGC on Tuesday opted to defer a decision on approving a Category 1 (retail) sports betting license for PENN Entertainment’s Plainridge Park, in part because of its relationship with Barstool Sports. PENN, which operates Barstool Sportsbook, is part-owner of Portnoy’s Barstool Sports — with plans to buy that media company entirely — and uses Barstool Sports and Portnoy to promote the sports betting site.
On Wednesday, the commission also deferred a decision on the MGM-Springfield application, saying that the application repeatedly referred to a partnership with BetMGM, and that it could not make a decision on MGM’s Category 1 license without first reviewing BetMGM’s Category 3 license application. MGM was late in filing its Category 1 license after an in-house “miscommunication,” but the commission last week voted to accept it.
Next up is Encore-Boston Harbor’s Category 1 license review, set for Thursday. The commission will then review applications for the five mobile operators tethered to casinos — Barstool Sportsbook (Plainridge Park), BetMGM (MGM-Springfield), Caesars Sportsbook (Encore-Boston Harbor), Fanatics Sportsbook (Plainridge Park), and WynnBET (Encore-Boston Harbor) beginning next week.
At Tuesday’s meeting, Commissioner Eileen O’Brien brought up the New York Times story and her concerns about Barstool’s “marketing and advertising that is going toward college-aged students and some of the other types of marketing and advertising that you have hitched yourselves to in the future.”
O’Brien pointed directly to this section of the Times’ story:
One Saturday in late September, Mr. Portnoy was in Knoxville, Tenn., for a University of Tennessee football game. He sat on an outdoor stage with other Barstool personalities and cans of High Noon, a vodka drink that he and Barstool are paid to promote. A raucous crowd of Tennessee fans yelled, cursed and pounded High Noon as Mr. Portnoy shared his latest wager: $100,000 on the University of Georgia to win the college football championship.
The stop at Tennessee was one of many made by the Barstool College Football Show this season. PENN executives maintained that the content of the show is not any different than that of ESPN or other major networks, where sports betting has become a major part of the conversation, and for which alcoholic beverage companies often advertise. The episode in question did not take place on the University of Tennessee campus.
Barstool Sports released its live college football road show schedule for 2022.
Mirrors that where some of its bloggers and personalities are well known: @BarstoolTrent (Iowa), @BarstoolMintzy (Ole Miss), @MeganMakinMoney (LSU), @CoachDuggs (Tennessee). pic.twitter.com/uMiLXWuhkC
— Mark J. Burns (@markjburns88) September 3, 2022
PENN praised for RG programs
PENN Vice President of Entertainment Erin Chamberlin noted that PENN and its Barstool Sportsbook do not have partnerships with any college sports programs, unlike several other major sportsbooks, including Caesars Sportsbook (Louisiana State, Michigan State) and PointsBet (Colorado, Maryland).
In addition, Chris Soriano, vice president, chief compliance officer at PENN, said his company has put “strict compliance guardrails” around Barstool Sportsbook marketing. He shared that Barstool personalities regularly tweet out responsible gaming messages that he believes are “relatable to younger folks.”
Throughout the discussion, commissioners repeatedly said that past experience shows them that PENN has above-average responsible gaming programs and rated the company’s current plan as an A++. But Chair Cathy Judd-Stein said the group had no choice but to weigh the information in the Times story.
Plainridge Park tests Play My Way responsible gaming system. System allows gamblers to set budget!. @capecodtimes pic.twitter.com/xo908sJTRt
— Steve Haines (@shainescct) June 9, 2016
“Regulators here are really at a crossroads — the timing of this article came right when we were having this conversation,” she said. “So now we have an obligation to reconcile what is very available publicly as to Barstool and the significant personality attached to Barstool and what we’re going to do about it as we think about this application.”
None of the commissioners directly mentioned Portnoy’s name, but it was clear when discussing “personalities” that it is Portnoy’s edgy, sometimes offensive personality to which they were referring.
PENN took risk providing story to MGC
An interesting side note to the discussion is that the New York Times stories might not have come to the commission’s attention had PENN itself not provided them to the MGC’s Investigations and Enforcement Bureau.
Soriano said PENN did so knowing there was a risk, but also because the company wanted to be transparent. The story in question traced the genesis of the relationship between PENN Entertainment, a traditional and conservative gaming company heavily invested in brick-and-mortar properties, and Barstool Sports, a company with a massive social media presence that appeals to a younger generation.
It’s clear PENN Entertainment officials knew the risks of partnering with Barstool Sports, as it laid them out in the company’s 2021 annual report:
Our investment and partnership with Barstool Sports may result in potential adverse reactions, negative publicity or changes to our business, regulatory or other stakeholder relationships. Our relationship with state gaming regulators, stakeholders and business partners could be adversely affected as a result of our affiliation with Barstool Sports. In addition, our business partners or stakeholders may react negatively to actual or perceived competitive threats from our affiliation with Barstool Sports and the individuals, influencers, and/or media personalities connected with Barstool Sports.
Integrity critical to MGC
Since the MGC was tasked with developing regulations for legal wagering, it has indicated tight advertising and marketing standards and strict responsible gaming rules would be prioritized. The commission earlier this year even discussed the possibility of banning sportsbook advertising on live television broadcasts. The final regulations won’t be quite that stiff — in part because it’s likely not even possible to prohibit advertisements on national television in a single market — but the commissioners have continued to stress their desire to uphold the integrity of gaming in Massachusetts.
Sports betting applications from MGM Springfield, Encore Boston Harbor, and Plainrdige Park Casino lay out what sports betting could look like in Massachusetts next year. More on what is in them here: #mapoli #sportsbetting https://t.co/wjt47abuD6
— Chris Van Buskirk (@byChrisVan) December 1, 2022
Tuesday’s meeting ended with no decision on the Plainridge Park retail sports betting application. The commission went into executive session for PENN Entertainment to share some proprietary information around advertising as well as to discuss kiosks for the property and suitability issues. It’s unclear when the commission will revisit Plainridge Park’s application.
The commission is in the process of hearing verbal presentations for each of the three existing casinos’ brick-and-mortar license applications. It will hear again from each regarding digital licenses next week. The commission was set to hear from MGM-Springfield Wednesday and Encore-Boston Harbor Thursday.
