H2GC Reports The US and Sports Betting | Page 5

Terminology
GGR vs Handle
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Although both are referenced herein, it should be noted H2 primarily utilises the gross win or ‘gross gaming revenue’ metric in its
analysis (i.e. sales less prizes, but including any bonuses played) rather than the US preferred ‘handle’/sales measure.
This is due to the fact that across different product verticals, geographies and market channels pay-out rates are all different.
Therefore, gross gaming revenue provides a much more consistent measure for comparative purposes. Furthermore, it also provides
a much better reflection of operators’ top line revenue as opposed to handle, which can include the same money that has been
recycled a number of times in many of the product verticals.
White, Grey and Black
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To be included in H2’s analysis normally any activity must be licensed either in the same jurisdiction as the player is located (‘white
market’) or licensed in a different market (‘grey market’). We do not cover any activity that is completely unregulated or illegal
(‘black market’) as standard, however we have referenced the latter in this analysis to offer a view on potential size as it applies to US
sports betting.
For clarity, H2 defines the 'non-white' aspects of the market via seven categories of betting activity:
‘Black’
1. Domestic illegal (unlicensed) face to face betting;
2. Domestic illegal (unlicensed) voice over phone telephone betting;
3. Domestic illegal (unlicensed) internet/mobile betting;
4. Offshore illegal (unlicensed) voice over phone telephone betting;
5. Offshore illegal (unlicensed) internet/mobile betting.
‘Grey’
6. Offshore illegal (licensed) voice over phone telephone betting;
7. Offshore illegal (licensed – in another jurisdiction) internet/mobile betting.
Sports Betting vs DFS (Daily Fantasy Sports)
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Definitions currently vary as to whether DFS is a form of sports betting differentiated by whether it is considered by regulators to be
a game of ‘chance’ (gambling) or ‘skill’ (non-gambling). As standard, H2 does not currently incorporate DFS within its projections for
this reason, however we have made specific comment on the activity herein given its specific popularity and relevance within the US
market.
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