H2GC Reports US sports betting: the road to 2030 | Page 11

The bridge
The bridge
Still only one third of potential
From $25bn to $8bn – 2030 optimal to actual
market size
H2 has calculated that nationally the total US
sports betting gross win has the potential to be
just under $25bn in 2030. However, there are a
number of factors that will limit the actual size.
The four components that make up the
difference between the potential and actual
market sports betting size are referred to as The
Bridge:
• At this stage it is expected that 20 states will
not regulate sports betting, this accounts for
$5.5bn, or 22% of the gap.
• Any taxation over a nominal level will have
some impact of limiting market size. This will
become more pronounced as the tax rate
increases. At present tax rates have been
announced ranging from 7% in Iowa (Nevada
was already at 6.75%) to 51% in Rhode Island.
Chart 9: 2030 H2 bridge – from optimum to actual
US sports betting gross win ($bn)
H2 has concluded that the combined impact
of the taxation rates will reduce the market
size achieved by $4bn, or 16%.
• We have already referred to the importance of
mobile. H2 is only assuming 50% of the states
that regulate will permit widespread mobile.
The impact will be to reduce the actual market
by a further $4bn, or 16%.
• Finally supply, whether this be a limitation
of/monopoly operators, a limited number of
facilities i.e. only racinos or casinos permitted,
or a limitation on the content/product that
may be offered will have an impact. It is
anticipated that this will limit the market by
$3.3bn, or 14%.
Therefore, it is expected that actual market will
generate c$8bn in 2030, realizing 33% of its full
potential.
Chart 10: % US sports betting market realized
25
No Mobile
16%
-5.46
20
Actual 2030
33%
-3.98
15
-3.13
24.69
5
US sports betting: the road to 2030 November 2018
8.13
0
Supply
13%
-3.98
10
Taxation
16%
States
22%
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