Will instant betting decide US markets?

The world was experiencing significant change in the late 2000s. Barack Obama was inaugurated as the 44^th President of the United States, the banking sector was under scrutiny like never before as the world was sent into a financial crisis, and people were starting to discover a new phenomenon called social media.

Meanwhile, in-play betting, itself a fairly new entrant to the sports betting sphere, was developing at pace. Realising players may not be content with simply being able to bet on the result of a contest in-play, operators began to offer more immediate markets, particularly in sports like tennis, with live odds on the next game winner accelerating the rate at which in-play bets could be placed.

A very different landscape

The process of pricing up and offering instant betting was far from a simple task at this point. Stephen Parkes, technical sales manager for supplier Genius Sports, was on the operator side at the time, and he explains to EGR: “About 12 years ago, I was a junior trading assistant at William Hill, and the next game winner in tennis was one of the first markets we offered. There was no supplier that could provide instant betting to operators at that point. It was a case of me clicking buttons manually to release the next game on old school betting platforms.”

Fast forward to 2021, and the operation is somewhat different. Now, instant betting markets can be found on a majority of sports, and they can provide a welcome alternative when outright markets are either settled or close to settled. Traders are of course still required to oversee the process, but it is far less labour-intensive than it once was, with algorithms able to account for a majority of the work. Models have been consistently updated to pull up as much information as possible, and the days of traders scrambling to rapidly price and update a next point winner market are a thing of the past. Just a quick glance at some in-play tennis markets at the time of writing shows markets including ‘next game correct score’ and the winner of each of the next three points from one match in the Eastbourne International.

Numbers point to one thing

Like with many facets of sports betting in recent times, the focus of instant betting is likely to shift more and more to the US, with NFL and MLB games in particular ripe for instant betting with their stop/start nature. Since PASPA of 1992 was overturned by the Supreme Court in 2018, a total of 20 states and Washington, DC have become legal, regulated sports betting markets. The proof can already be found in some of the data, showing there is a strong appetite for in-play betting from US-based players.

Warren Llambias, MD of specialist US sports operator Redzone.bet, says: “In-play now accounts for close to 60% of the number of bets we process on the core US sports. Within that, fast markets will see around 25% of the in-play bets, depending on the sport, while player props will be about another 25% and core markets and their derivatives the other 50%. The trend is most definitely upwards for these instant markets as we were only seeing around 10% of bets on them just six months ago.”

Warren Llambias, Redzone.bet

If those numbers are not impressive enough, Simon Noy, head of trading at supplier Kambi, explains how its data improved in this area last year. He says: “In the Super Bowl a few years ago, before we invested in more instant markets, the drive market was making up more live turnover as the game was going on and as the result was developing. In 2021, instant handle on NFL rose 400% on the previous year. The numbers are also strong in baseball, where in the 2020 World Series, 25% of the live betting turnover was on Kambi’s unique ‘result of pitch’ market.”

The US is of course of huge relevance to Genius Sports, which was announced as the NFL’s official data supplier in April and is also partnered with US operator heavyweights FanDuel and DraftKings. What can particularly aid the instant betting offering in the US is the lessons learned from building the product in Europe. While there was a steep learning curve in Europe as the industry worked out how to build models to take care of instant betting, suppliers and operators moving into US markets now have the knowledge to grow these tools much faster than they have before.

Dmitry Sukhatsky, country manager at Genius Sports, who joined Parkes on the same call, says: “At the moment, the US is very pre-match heavy. The markets are super-fast in Europe, but we’ve already seen the shift that’s started in the US. Last year, 15% of our US betting turnover was in-play, but it’s now 20%.

“It will still likely take a few years for this to really improve in the US, but I think it will be much faster than Europe because we already know how to popularise it. I think it will be very popular in the US but it still might not be as popular as Europe.”

Once the US markets mature, we could have a clearer picture of which operators and suppliers have forged a lead on their competitors. Like with most areas of a sports betting platform, user experience can differ across the market and, according to Parkes, this is very likely to be a differentiator. He says: “If there is a custom-built widget that updates itself and can settle bets super fast, then it’s just a totally different ball game. If you picked out 20 different sportsbooks offering those markets, the UX will be different at all the sites. I don’t think pricing makes much of a difference here.”

Dmitry Sukhatsky, Genius Sports

Too much attention?

Future growth in this field will not come without its challenges. Referring back to the overturning of PASPA three years ago, this marked the end of an arduous conflict between the state of New Jersey on one side, and the North American major sports leagues and National Collegiate Athletic Association (NCAA) on the other. With the leagues and NCAA long arguing about how legalised sports betting could impact on the integrity of sports, and particularly with the current negative public perception of gambling in the UK, are these markets perhaps likely to come under scrutiny from politicians and regulators?

Parkes says: “The responsible gambling tide may end up limiting the scope of these markets. With our NFL deal, we have a list of things the NFL does not want us to offer. The vulnerability of some of these markets may mean that, eventually, we may only be able to offer instant betting on top-tier events. That is why we have an integrity division dedicated to reporting on the wider marketplace.”

While official data partnerships have increased the reliability of the data on US sports, for each supplier and operator, getting access to this data is vitally important. Noy says. “The result of the pitch in baseball is an obvious market, but we couldn’t offer it until we were receiving reliable data for each pitch. We need authoritative, reliable data before we can offer markets to players and that is a big challenge across the market.”

Simon Noy, Kambi

Despite any challenges these markets may face, Llambias’ optimism is unequivocal. “We forecast instant markets to see the majority of in-play bets in baseball, ahead of core markets, by the end of the 2022 season and to be around 50% of NFL in-play bets too,” he says.

The world is now a very different place to what it was in the late 2000s and as competition intensifies, we may soon see a US market showing more maturity in this field than territories that have offered the same types of bets for at least a decade longer.