All Bets are On
Now that the legal restrictions have been lifted and the snowball is careening down the mountain , sports betting is a completely acceptable and increasingly recognizable option for other businesses looking to leverage their expansive customer bases in the name of diversification — especially those with any plausible connection to sports .
“ Broadly , sports betting is a business that fits nicely alongside a variety of businesses ,” explains Chris Grove , partner emeritus at Eilers & Krejcik Gaming . “ The casino business is chief among them , but media , collectibles , merchandise and other sports-related businesses have meaningful and profitable ways to intersect with sports betting .”
Due to the fact that no gaming analyst , even after PASPA was toppled , would have ever predicted the introduction of fairytale brands like Disney into the betting landscape , the race for market share is still very much alive . FanDuel and DraftKings may comfortably hold the top two spots as of now , but neither has billion-dollar media rights deals or uniform contracts with all major U . S . leagues to help make up for game-winning baskets or backdoor covers .
Because of this influence , Grove contends that we are “ still very much in the early chapters of online gambling in the U . S .,” adding that the “ long-term dominance of FanDuel and DraftKings is far from assured .”
Braden Mark , the U . S . travel , leisure and hospitality sector leader for KPMG , echoes these bullish sentiments .
“ Sports betting in the U . S . has become a multibillion-dollar market and is projected to grow enormously in the next few years , leading many different players to consider entering the market or expanding their current platform ,” he says . “ Businesses with tertiary products in the sports and entertainment world , but not necessarily gaming , are looking for ways to leverage their customer base , products and services in order to take market share and be a part of the overall sports betting marketplace .”
Mark also agrees that although “ the top two spots are somewhat established and unlikely to be disrupted anytime soon ,” there is still “ opportunity for other players to take market share .”
All factors considered , the industry ’ s meteoric growth and its infusion of high-influence brands have certainly done well to cultivate a potent deal-making environment , but the mainstream-ification of sports betting has also guided players away from black-market and offshore sites , which all licensed operators — even the ones struggling to maintain market share or losing it altogether — would agree is a positive business development .
“ There ’ s no question that we have been able to migrate literally tens of millions of Americans who previously only had the illegal marketplace as an option for sports betting in the last five years ,” AGA President and CEO Bill Miller told GGB during the association ’ s State of the Industry press conference .
“ Sports betting in the U . S . has become a multibillion-dollar market and is projected to grow enormously in the next few years , leading many different players to consider entering the market or expanding their current platform … Businesses with tertiary products in the sports and entertainment worlds , but not necessarily gaming , are looking for ways to leverage their customer base , products and services in order to take market share and be a part of the overall sports betting marketplace .”
— Braden Mark , U . S . Travel , Leisure & Hospitality Sector Leader , KPMG
“ We are migrating Americans into the safety of consumer protections of that legal marketplace by the tens of millions , and I think that will be further as we continue to bring in stronger brands . But the illegal marketplace is not going anywhere because we need to figure out how we can better understand where they are and how to stop them .”
This Town Ain ’ t Big Enough
At this stage it must be noted that as with any burgeoning and competitive industry , the growth of U . S . sports betting has inevitably resulted in losses and departures to coincide with the gains and headlines — as hedge fund guru Ray Dalio has often pointed out , one man ’ s spending must be another ’ s income .
The list of exits is perhaps longer than most bettors realize , given that they often go quietly into the night . Some , like PointsBet U . S . and Barstool Sportsbook , are flipped and rebranded , while others simply cut their losses while they can . Some were not-so-memorable examples of non-gaming entities trying their hand at diversification , such as Maxim Bet , Fubo Sportsbook and FOX Bet . Even experienced and highly respected gamers have had to face the harsh realities of increasing marketing spend and customer acquisition costs , with Churchill Downs ’ TwinSpires and Wynn ’ s WynnBET being two notable examples .
“ We ’ ll inevitably see consolidation and deconsolidation in the U . S . online industry , much as we have in the U . S . retail casino industry and in the international online gambling industry ,” Grove contends .
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