Kambi CEO: Operators run risk of “playing catch-up” by moving sportsbook tech in-house

Kambi CEO Kristian Nylén has highlighted the risk faced by operators when moving sportsbook technology in-house by suggesting the product offering could leave them “playing catch-up”.

Speaking to EGR following the sports betting supplier’s Q1 2021 results which detailed a 55% rise in revenue, Nylén said the decision by operators including DraftKings and 888 to move onto their own tech stacks might not be the best long-term strategy, from both a product and financial perspective.

London-listed 888 has transferred onto its proprietary Spectate sports betting platform in certain markets, including the UK and Sweden, while US powerhouse DraftKings is primed to move onto its in-house platform in Q3 following its acquisition of SBTech last year via a three-way merger involving a SPAC.

Nylén said: “I don’t think there are many possibilities to find new quality tech to acquire for most companies. And you will downgrade quite significantly if you choose to do it in-house.

“I hear arguments about getting control over the tech stack, and fair enough you’re getting control, but if you are then left playing catch-up to us and others in terms of quality then that will not get you in a great position anyway.

“Long-term, I don’t think it’s a good decision to create revenue for the operators.”

Despite the switch in strategy by 888 and DraftKings, Nylén remains optimistic for the future given the potential of current partners and the growth of the US sports betting market.

He said: “Penn National Gaming is not online in very many states yet and Churchill Downs is just pushing the button on their activities having changed their brand to TwinSpires from BetAmerica.

“I think with new market access some of our operators have a lot of growth and that is a good place to start when replacing the others,” he added.