The next big thing in sports will be sports betting via live television and device-based applications. The statistics show that user engagement with content increases as soon as sports betting options are introduced to fans. The U.S. Supreme Court has indeed opened the floodgates to sports and betting converging, which has led to hundreds of sports betting brand partnerships between teams, leagues, players, and companies willing to pay a fee to be joined at the proverbial hip.
Sportsradar is the now the leader in official data for the four major American sports leagues. PointsBet just joined live streaming platform Genius Sports in a line of partnerships between content leaders and sports betting brands. With paid television revenue dropping by roughly 50% for 2015 to 2025 ($105b down to $56b), television networks and professional sports leagues will need another hook, bite, or engagement-increaser to make up for the lost dollars. The revenue bridge is sports betting.
Is there a right way to build these partnerships? Absolutely. For one, the state, county, and city where the potential for a sports partnership exists must be in play (meaning legislation allowing for sports betting, which was the essence of the U.S. Supreme Court decision). The U.S. Supreme Court opened the door for states to pursue legislation to allow for sports betting and one reason for the delay sports betting partnerships in the past was the lack of opportunity to do so. Of course, having a broadcast sports brand partnership does not require local or even state approval as an advertising piece, but from an at-home or anywhere betting opportunity state and local approval is required.
As a model, many states can look towards the 50/50 type raffles at professional events. In Arizona, for example, college and professional sports fans can engage in 50/50 raffles from the comforts of their home. Of course, those raffles are not connected with the outcome(s) within or from the game. 50/50 raffles are a game of chance based on your ticket number where 50% of the winnings goes to the customer and 50% to a non-profit charity of the team or universities choice. 50/50 raffles are meant to engage people in the experience of the game as a form of entertainment. A sports betting opportunity would literally be based on the outcome(s) within and from the game.
With sports betting being based on the outcome(s) of the game is where the engagement comes into play. A comparison would be where fantasy sports keeps users engaged because they want to see what happens for the players on their virtual teams. Now imagine the next level of engagement where a user can play fantasy sports and bet on the outcome, or individually bet on the outcome(s) without being connected to fantasy sports. In the aforementioned sense, it is the last frontier of sports betting. It is the normalization, for better or worse, of sports betting being more available with the stated goal of being able to bet from anywhere without restriction.
Currently, about 18 states allow for legalized sports betting with the largest domino waiting to fall being California. Whether it be for tax dollars, team/fan engagement, more advertising and sponsorship dollars, or more television revenue via traditional or application-based platforms, sports betting is on the move. Legalized sports betting will help gain profits where paid television subscribers are leaving for streaming options, where consumers could place a bet from as well.
