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The sports betting industry is set for a big year
30th January, 15:02Health care and abortion are the top issues being searched in Iowa3 hours ago / Politics
Barstool Sports used to be a media company, but on the heels of a $163 million investment from Penn National Gaming, it is now, in many respects, a sports betting company.
Why it matters: Barstool's evolution speaks to where the sports betting industry stands at the outset of 2020. With legalization on the horizon in key states and mobile betting set to explode, sportsbook operators are in a race to acquire users and build the best digital storefront.
Meanwhile, publishers have begun incorporating sports betting into their coverage, hoping to cash in on exclusive partnerships (i.e. Bleacher Report and Caesar's Palace) and affiliate deals (i.e. sportsbooks offering commissions to publishers that drive users to place bets with them).What's ahead
1. More media deals: Since the Supreme Court lifted the federal ban on sports betting 20 months ago, fantasy sports companies like DraftKings and FanDuel have benefitted from being top of mind among casual bettors, while most gambling operators have struggled with brand awareness.
Why Penn did this deal: Instead of having to organically acquire new users, Barstool's 66 million unique monthly users will be funneled directly to their retail sportsbooks and mobile app.What to watch: We should expect to see more deals like this that pair sportsbooks with existing audiences. But not every outlet is flexible enough to take on sports betting, so it will be interesting to see who leans in and who bows out.
2. Continued legalization: By the end of 2020, more than half of U.S. states could realistically have legalized betting -- a tipping point for an industry that is currently catering to a fragmented audience.
Watch the big states: "The prize is so large in states like California, New York and Florida that every relevant stakeholder is willing to do whatever it takes to guarantee a seat at the table. They're just not going to accept being shut out of those states in the same way they might accept being shut out of a smaller state," Chris Grove, a partner at Eilers & Krejcik Gaming, tells Axios.
3. Startup explosion: Many of the startups that got off the ground last year are either entering major growth phases or on the verge of rolling out their MVPs (minimum viable products) in 2020.
Apps/Tools: The Action Network is the "Bloomberg for sports betting." A website called Abe wants to be the "Kayak for sports betting." In other words, we have officially entered the "[Existing app] for sports betting" phase.Plumbing: "Sports betting is still not the most efficient machine from a backend perspective, so expect to see more and more talk about things like payments this year," said Grove.
4. Branded sportsbooks: As I mentioned earlier, the Barstool acquisition lets Penn funnel users directly into its retail sportsbooks and mobile app. But hang on -- why not take it a step further and just rebrand to ... "Barstool Sportsbook?"
$6.8 billion could be bet on Super Bowl (ESPN)Gambling will overwhelm sports media in 2020 (Digiday)Sportsbook, app, and casino all next for Barstool Sports (Front Office Sports)