10 October 2018 | Russell Karp
Place Your Bets: Industries Most Likely to Score Big In Sports Gambling
While sports enthusiasts living in Nevada have enjoyed wagering on their favorite teams for years, fans in the rest of the United States were unable to take part in the fun.
That is, until now.
The U.S. Supreme Court's monumental decision to strike down a long-standing federal law opens up sports betting to the rest of the country. And although regulations are currently set on a state-by-state basis, the expectation of imminent federal control means we're on our way to legalized wagering on sports events across the entire nation.
As new gambling platforms are being developed, a wide range of industries are well-positioned to benefit greatly from the massive revenue potential in this marketplace.
1. Fantasy Sports
New opportunities abound in this sector. From opening proprietary sportsbooks and developing betting apps to entering into partnerships with casinos, sports bars, and media companies, fantasy sports enterprises are ready to meet the increasing demand resulting from nation-wide legalized betting. While there are two clear leaders in this space, DraftKings and FanDuel, it's likely that new players will emerge as the market expands.
Deals are being signed quickly through partnerships with casinos, as gaming brands scramble to lead the rising U.S. sports betting market. Kindred Group is pursuing a Casino Service Industry Enterprise License in New Jersey via an agreement with Hard Rock Hotel & Casino Atlantic City, while Canadian company The Stars Group and Atlantic City's Resorts Casino Hotel extended their existing partnership to add online and mobile sports betting through European wagering brand BetStars. And the list goes on from there, as unprecedented deals continue to be solidified at a rapid pace.
3. Sports Bars and Restaurants
And how about restaurants and bars? Eager to join the excitement, restaurant chain Buffalo Wild Wings entered into a partnership with Daily Fantasy Sports giant DraftKings to develop a customized fantasy football game in every one of its 1,200+ locations as a method to solidify its place as the go to destination for sports betting once it becomes legal across the country. Clearly illustrating the potential of legalized national wagering, sports bars and restaurants hold the cards to a massive new revenue stream.
4. Social Media
Sports betting and social media go hand-in-hand. With a smartphone in the pockets of practically everyone, an increasing number of people are likely to follow games on mobile. Social media is now an essential tool in making an educated pregame and in game wager. Every gambler wants to win, and analyzing the insights available on social networks can make a major difference in the size of your wallet at the end of the day. Additionally, a significant number of online sportsbooks and other companies are now using social media platforms as a marketing and advertising tool, thereby creating yet another revenue stream with the potential for massive expansion.
5. Media Companies and TV
After the Supreme Court decision was announced, billionaire Dallas Mavericks owner Mark Cuban said he believed the value of professional sports franchises were doubled as a result of the ruling. Although some may consider this hyperbole, there are others who think the statement was too low, with predictions that the amount of cash about to hit the sports gambling market is actually being underestimated. The related opportunities for media and television companies are enormous, as a 2016 Nielsen Sports study found that although sports betters composed just 25% of the NFL viewing audience, they accounted for 47% of the time spent watching games. If you have money riding on a game, you're likely to watch more than twice as much as non-gamblers. And the media industry is listening. ESPN recently launched the first gambling-focused show, featuring experts picking their top 10 bets. FS1 went a step further by launching a daily sports gambling show called “Lock It In” with known betting personalities. Another concept involves in-game micro-wagering, which is expected to grow exponentially as states adopt sports gambling. However, current delays between the place where an event is happening and the place where the event is being televised prevent the possibility of play-by-play wagering. It's expected that technology firms will quickly develop real-time picture-and-sound transmission to allow this expansive revenue potential to be realized.
6. Construction and A/V Industry
Many people believe that sports betting will mark a rebirth of Atlantic City. A/V integrators will be a vital part of the technological solutions required to accommodate this expanding market. The need for installation of LEDs, suites, and loge seating at existing casinos may grow quickly as a result of the Supreme Court decision. The industry also sees a strong correlation between a more engaging video and audio experience in stadiums and the future of sportsbooks, leading to a range of tech opportunities for this sector. In particular, consumer demand will drive casinos to build sportsbooks to accommodate the betting public.
7. Sports Leagues, Teams and Associations
In July, MGM Resorts International announced its agreement with the NBA to become the league's first sports betting partner. The deal enables the casino chain to use teams' official names, logos and data streams in its hotels. At a price of at least $25 million, according to an ESPN report, the three-year contract may be a sign of deals to come in other sports. Although the NHL does not openly support sports betting, the Las Vegas Golden Knights have recently become the league’s first team to announce a sports betting partnership with William Hill, the world's leading sports book operator. "Like the Vegas Golden Knights, William Hill US is a proud 'Vegas Born' organization. This partnership between a major professional team and a sports book operator is a historic, landmark agreement and we are delighted to be leading the way with William Hill in this space," said Vegas Golden Knights President Kerry Bubolz. The new partners plan to engage with bettors via all kinds of media, advertising and promotional platforms. Though the NFL has publicly stated that is does not support the sports betting industry, the Dallas Cowboys have become the first team to announce a gambling partnership with WinStar World, a Tribal casino.
8. Sports Venues
Why fly to Vegas when you can place your bets just outside of New York City? The Meadowlands Racetrack, located in the complex where the New York Giants and New York Jets play, marks the fourth sports betting outlet to open in New Jersey following the Supreme Court ruling. In addition to offering convenience, fan engagement with the games they watch is also expected to greatly increase as a result.
There you have it. As a growing number of industries seek their piece of the revenue pie, sports betting is on its way to being a central component of a fresh landscape, with innovators devising new monetization streams as we speak.
Originally published at The Mission.