Prospects for expanding into the US

Better Collective’s Marc Pedersen comments on the prospects for online gambling in Tennessee following the legalization of online sports betting

With the repeal of PASPA in May last year, making the legal status of sports betting a state matter, many actors within the industry look at the US market with high anticipations – and for good reason.

Several states that have been in favor of repealing the act, including the persistent New Jersey, have legalized online sports betting within their state. While some states may abstain from legalizing sports betting, we anticipate that most states will do so over the coming years. Dependent on this process, various market sources expect the regulated US sports betting market to surpass $6bn in five years.

In other words: big business is at stake and it is expected many actors look to get a piece of the pie. With an online sports betting market that may surpass the European one in terms of turnover within five to 10 years, it comes as no surprise that the industry welcomes the repeal of PASPA.

Also, taking a wider societal perspective, many upsides will follow. For one, a regulated betting market empowers sports bettors as betting no longer takes place offshore and therefore the bargaining power is no longer solely on the supplier side.

Also, a regulated market is beneficial for society in relation to jobs and income taxes, which in turn can be invested into research that can work towards preventing problem gambling. In Tennessee, it is estimated that taxes on online betting will bring in $50m per year to the state.

For industry actors, history also shows a regulated market ensures stability, predictability and steady growth, which are key market characteristics for leading a long-term successful business.

It takes local market knowledge to be successful

With a large new US market opening up within the next couple of years, competition will follow. However, to be successful in any market, you need to know the market. This is particularly the case for the US. Established European affiliates need to do their due diligence and analyze the US market terrain they are entering to have a chance against competitors.

For instance, the US and European sports and betting cultures differ significantly – hence actors leading a successful business in Europe, that simply take their European strategy and apply it to the US market, will undoubtedly experience challenges.

The same will be the case if you take one universal US approach, as interstate differences are also significant. From a European context and lingo, each state should basically be considered and analyzed as an independent nation.

Let’s look at Tennessee as a case. Tennessee is basically green when it comes to sports betting and is one of the few states to not have any brick-and-mortar operations within its borders, and therefore is starting from scratch.

Hence, the content for sports bettors in this state should therefore differ from the content of New Jersey, for example, where guidance is less required thanks to its history in the state.

In terms of legal matters, we also see big interstate differences and the same is the case for many other areas. However, the fact that a state like Tennessee is opening up to sports betting, without ever having a real cultural connection to it, illustrates that many states are seeing the benefits of regulating based solely on the positive results of other states.

This is a good sign for those of us who are hoping for more markets in the US to open up. Many actors will undoubtedly follow the development across various US states and also be preparing to launch as new states legalize online gambling.


p33 Marc Pedersen

Marc Pedersen is the VP of business development and sales and general manager US at Better Collective, the world’s leading sports betting affiliate within the egaming industry. Pedersen has worked at Better Collective since 2007 and has been an integral figure in helping the company become one of the foremost affiliates in the betting industry.

Affiliates | Better Collective | Strategy | Tennessee