When sports streamer FuboTV shuttered its online sports wagering business last month it felt like an outlier, and with reports strengthening that Disney is about to launch its own live betting integration, increasingly it appears to be the exception rather than the rule.
According to a recent report, the global sports betting market is expected to reach $114.4 billion by 2028, which is just over 86% growth compared to 2021 driven by the increasing popularity of online and mobile betting and the relaxation of laws permitting sports gambling in the U.S. Another analyst charts the global market attaining $182bn by 2030.
“The only conversation [there] is how to maximize the sportbook and betting rights,” says Chris Wilson Director of Market Development, Sports at MediaKind. “Betting is the uber use case. It unlocks huge amounts of revenue.”
FuboTV, which as of November had over 1.23 million subscribers in the US, may have made two mistakes. One was being the first to try to crack the market. Launching in Fall 2021 it will have hoped to leverage early mover advantage, ahead of wider rollouts by the major sports networks, but its comparative lack of clout and rights in the market failed to entice sufficient numbers.
It struck deals with the NBA team Cleveland Cavaliers, Major League Soccer’s Houston Dynamo, and with NASCAR to enable fans to watch live matches/races and bet on in-game plays via a mobile app. For example, correct predictions could win a year’s subscription to FuboTV service – which at $70 a month is not a bad deal.
Its second strategic error and also one associated with its relative size may have been to try and establish its own sportsbook rather than partner with a bigger betting brand. In addition, it faced hurdles launching into many states which retain stricter regulations around live betting.
With the company suffering a $100m Q3 loss FuboTV scrapped its immediate gaming ambitions.
“While multiple parties expressed interest in the business,” it claimed, “none of these opportunities would have allowed Fubo to lower its funding requirements and generate sufficient returns to shareholders.” Execs blamed a “challenging macroeconomic environment” for the decision.
However, it remains a very good bet that sports gambling will take-off and that it will drive decent revenue for sports rights holders. Some think it’s a dead cert.
“Perhaps the greatest benefit to sports streamers will be that 5G enables them to meet fan expectations to be able to interact with their favourite sports and teams from anywhere at any time,” says Sanjay Duda, COO, Planetcast International, an India-based broadcasting service supplier. “As the quality of these mobile experiences increases, fans will watch for longer and will be more likely to take part in monetizable actions such as betting and shopping. In fact, when it comes to betting, the low latency of 5G combined with ATSC 3.0 will be a great enabler of sports betting.”
Other media companies with a large sports streaming presence have either already integrated sports betting into their platforms, or are exploring ways to do so with betting operators.
NBCU offered betting during the PGA Tour on Peacock in January this year. In September, NBC teamed with BetMGM, to produce and deliver gambling and fantasy content on NBC’s “Football Night in America” pregame show and across NBC Sports broadcasts on Peacock and its other sports platforms. NBC’s regional sports network in Chicago is already offering several “BetCast” sports-betting-themed alternative broadcast of Bulls games this year.
Also around the new NFL season (and the first in a new set of rights for the league running until 2033) is Amazon’s pact with DraftKings and TNF. As part of the multi-year agreement, TNF will contain DraftKings integrations in the live pregame, including odds and additional sports betting insights. DraftKings and Amazon will also collaborate on TNF-themed offerings, including same-game parlays, which will be available on the DraftKings Sportsbook app.
Meanwhile, betting giant FanDuel has launched its own gambling-focused cable channel (FanDuel TV) and streaming service (FanDuel+). Available on Roku, Apple TV, and Amazon Fire, FanDuel+ went live in select states in September including in Kanas where new users are offered a “$1,000 No Sweat First Bet” promotion.
A FanDuel Casino marketing campaign aimed at a changing audience is just one example of FanDuel’s recognition that bettors are evolving, suggests Bonus, which reports that half of FanDuel Casino gamblers are women.
Disney is also about to play its hand. Earlier this year the WSJ reported that Disney was looking to license the ESPN brand to major sports-betting companies for at least $3 billion over several years. That partner is highly likely DraftKings in which Disney holds a stake from its 2019 acquisition of Twenty-First Century Fox.
A tie-up between the two companies makes strategic sense,” according to Bloomberg Intelligence analysts Brian Egger and Geetha Ranganathan. “Licensing EPSN’s brand to a sports book and integrating bet odds in broadcasts could help both companies widen their audiences.”
We may not find Mickey Mouse branded roulette wheels at Disney World but the sports brand is primed for adult oriented exploitation.
ESPN Chairman Jimmy Pitaro even told Bloomberg that the sports media giant wants to “eliminate friction” for bettors. He said, “We know that sports fans are craving not just more sports betting content, but they’re craving the ability to actually place bets in a seamless fashion from their online digital sports experiences.”
In a September interview with Bloomberg, Disney CEO Bob Chapek confirmed this thinking. “Sports betting is a part of what our younger, say, under-35 sports audience is telling us they want as part of their sports lifestyle,” Chapek said.
So ripe is the potential for wagering, even if this is applied first as gamification without financial stakes, that FuboTV hasn’t given up on making it work.
“I’m extremely bullish on the integration of gaming and video,” said CEO David Gandler during its Q3 earnings call. “So we are in discussions with, I would say, numerous books. These discussions, I would say, are pretty healthy. It’s a very competitive landscape on the gaming side.”
Meanwhile, Warner Bros Discovery Sports is playing its cards close to the chest. Asked about potential plans to move into sportsbook, WBDS execs including François Ribeiro, head of Discovery Sports Events, declined to comment while hinting that it was a space they were watching.
WBDS is exploring its own digital activations around the UCI Track Champions League including offering fans greater opportunities to interact with track stars using what WBD is billing as Web3 technology.
It’s not just a new and potentially lucrative revenue streams that sports rights holders want to access. The technology that enables this requires ultra-low latency, adjacent to realtime, feeds – linking cloud to the network edge. It’s thought this will open-up more direct connections to consumers, more data to target audiences to stem churn and unlock fabled next-gen apps like live streamed VR.
“The next step in sports will be to make experiences more immersive, using AR and VR technologies,” says Xavier Leclercq, VP Business Development, Broadpeak. “More bandwidth will be required, and edge computing will become a technology enabler for low-latency and high-reliability experiences. ISPs and OTT service providers will have to collaborate for this to become a reality.
Wilson says that if the betting industry is to attract a legion of customers and fans in this market, “streaming providers must provide dependable, broadcast-quality video with the lowest possible delay to support the interactive betting software. This will ensure viewers can be confident they are betting on an equal playing field with fans in attendance at the court, stadium, or arena.”
Some challenges are not necessarily technical, particularly in markets outside the US. “Betting is treated with mixed feeling in a number of countries,” says Duda. “In India, for example, there are severe limitations to public betting. However, rights holders are finding adjacent engagements such as fantasy sporting and skill-based gaming where points are linked to performances or game outcomes.”
With more and more people turning to mobile devices for their betting needs, it’s safe to say that the industry is only going to continue to grow.
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