US predictions for 2021 – including BetMGM and Barstool Sportsbook to gain market share and new betting innovations

Matt Davey, CEO, Tekkorp Digital Acquisition Corp.

Matt Davey

BetMGM and Penn to challenge the DFS giants

DraftKings and FanDuel will continue to compete for pole position nationwide, with BetMGM and Penn National increasingly matching reach and underwriting an argument for potential leadership contention. Make no mistake, though, the US is a highly fragmented landscape featuring huge scope and potential. Therefore, no-one’s leadership standing should be taken for granted long-term – certainly five or 10 years down the line. The next 12 months will only witness more early skirmishes, as contenders jockey for market position. And while the pandemic has reminded us that you simply can’t see beyond most horizons, we’re not dealing with tectonic shift here. Momentum is building, the trend towards digitization is only accelerating, and some innovative disruptors are also beginning to show their hands.

Follow the smaller footprints

Regional leaders will emerge with smaller multi-state footprints and market-leading positions in specific states. We’ve seen the moves that Bally’s has made, acquiring the sportsbook platform Bet.Works, alongside a separate deal with the Sinclair Broadcast Group to rename the 21 Fox regional sports networks (RSNs) to Bally’s Sports. Then, of course, on the East Coast there’s Barstool Sportsbook and Hard Rock Digital in Florida. Each has staked solid claims to innovation and digital diversification, while their respective ingredients for immediate traction are as obvious as they are palpable.

New angles from operators

Without using my third and final prediction to wish for more wishes, I’ll concisely break this down into three distinct areas of imminent development:

(a) Additional international operators will enter the market at scale and provide material competition to the homegrown cohort.

(b) We will see further nationwide media deals executed with smaller sports betting operators. After all, some key media players are still searching for their dance partners.

(c) Operators will continue to raise significant sums of capital to fund market expansion.

Dr Laila Mintas, CEO, PlayUp

Highly attractive investment space

From an investor standpoint, 2020 has been clearly the year of reverse mergers, IPOs and acquisitions with massive valuations. The US sports betting and igaming market will continue to be very attractive for investors in 2021 that aim to invest in technology in the entertainment space. There is a clear appetite in the market for betting companies to try to build their own technology in-house or to gain it through M&A. There is no doubt that the quality of proprietary technology will make a significant difference in this still young US market which is positioned to become the largest legal sports betting market in the world with an expected size of $17+ bn in GGR only from sports betting in a few years.

Online first

The online sports betting and igaming space has been the clear winner in 2020 and we will see this trend continuing in 2021. Pre-Covid we have seen already a strong growth in the online space but since the pandemic there is no doubt that this shift is unstoppable. As some of the earlier US states that legalized betting restricted online sports betting and lost major potential revenues throughout the pandemic, we will now see all new markets that regulate sports betting in 2021 to allow for online sports betting with no requirement for physical registration in casinos. The same is true for igaming which has been growing significantly and will be legalized in many more states in 2021.

Increased product innovation

Many products that sports fans can currently choose from in the US market look very similar – this is the case for the different betting markets that are offered as well as for the odds which are not very competitive at the moment. Also, what is still missing for the major US sports so far is a “watch and bet” experience which means the sports fan can watch the game on one single app and place a bet through the same app. This has been part of a less fragmented fan experience in more mature like Europe for decades. I am also a strong believer that tracking data and biometric data will play a major role in the betting space and that we will see first products embracing this in 2021.