- FanDuel and Rush Street’s CEOs both agree that consolidation is imminent in the betting market.
- TwinSpires and TheScoreBet already closed down due to issues that could be explained by consolidation.
- Long term, bettors might end up with less options, and a less competitive market for their sports betting desires.
LAS VEGAS – Sports betting markets all over America have been booming, but individual retailers have been running into trouble obtaining market share.
Is a consolidation imminent? FanDuel CEO Amy Howe thinks so.
There won’t be 12+ sports betting operators able to sustain the current level of marketing spend and investment, FanDuel CEO Amy Howe said during an industry conference today, meaning further gaming consolidation is inevitable, even considering current depressed valuations
— Ryan Butler (@ButlerBets) July 13, 2022
Rush Street Interactive CEO Richard Schwartz agrees.
Rush Street Interactive CEO Richard Schwartz: As companies pull back on marketing, product performance will be the differentiating factor; The $RSI CEO expects further industry consolidation, he said during today’s SBC Conference
— Ryan Butler (@ButlerBets) July 13, 2022
What is this consolidation going to look like? What does it mean for bettors?
What Consolidation Looks Like – TwinSpires And TheScore
TwinSpires, the company that operates out of Churchill Downs, was always a horse race betting company first. However, their move into sports betting was met with great anticipation – until it turned out that the markets were too saturated and they were unable to be profitable.
CEO Bill Carstanjen announced the change with some chagrin, spinning it as the correct direction to take the company.
“We will exit the (business-to-consumer) online wagering space,” Carstanjen said. “This isn’t the result we wanted, but it is the prudent next step.”
A similar example of consolidation occurred more recently, when TheScoreBet, operated by Penn National Gaming, announced it would be leaving the US market to make more room for Barstool Sportsbook as Penn National’s USA flagship.
“Since Penn’s acquisition of theScore, the company’s plan has been to lead with Barstool Sportsbook in the U.S., and theScore Bet in Canada, given our strong brand equity there,” said theScore’s president and COO Benjie Levy.
What Consolidation Means For Bettors
In terms of what consolidation means for bettors, it’s best to consider both a short-term and long-term view.
In the short-term, consolidation means that there will be bettors that have to close out their accounts with sportsbooks like TheScoreBet and TwinSpires, and there could be repercussions to these issues that are unforeseen.
In the long-term, consolidation means that there will be fewer brands in the regulated markets pushing each other to spend more on bonuses.
This could mean that there will be less bonuses available for bettors, and it certainly means that there will be less ability to line shop in the regulated markets.
In addition, if this happens, it may mean a change to attitudes towards the online gambling market, which is not likely to go through the same kind of consolidation thanks to more open markets.