ESPN has reportedly suspended some branded news segments after a story broke Tuesday in The New York Times that said the attorney general in New York is looking into the practices of two leading fantasy sports sites.
The Times reported that the sites DraftKings and FanDuel were asked to provide details on their fraud prevention efforts as part of an inquiry into whether employees of the companies have been using inside information to win large payouts by playing on each other’s sites.
Media Daily News later reported: “ESPN has suspended its branded news segments featuring sports fantasy site DraftKings. The fantasy sports company has suspended virtually all TV advertising on the network.”
The report quotes a spokeswoman for ESPN saying: “We have pulled DraftKings billboards and sponsorship out of news programming today. It is a standard procedure for us to pull these kind of sponsorships and integrations when we are covering significant news, to avoid any suggestion of influence on our coverage.”
The story notes that ESPN entered into a $500 million ad deal with DraftKings several months ago.
“For its part, Fox has an 11% stake in DraftKings; Time Warner and Comcast have equity stakes in FanDuel,” the report notes, adding: “While virtually all DraftKings TV advertising on ESPN has been stopped, a DraftKings commercial did appear in the network’s ‘Pardon The Interruption’ show.”
DraftKings and FanDuel, meanwhile, reportedly released a joint announcement saying they are prohibiting their employees from participating in their fantasy sports competitions.
Advertising from DraftKings and FanDuel has been a windfall for sports networks and sports programming, with the stakes rising as the NFL season has gotten under way.
“According to iSpot,tv, from September 1 to October 6, DraftKings has spent $69.3 million in TV advertising; FanDuel has spent $61.2 million,” Media Daily News reports.