Connect with us
BSM Summit
blank

BSM Writers

BetMGM Gambles With NBC Sports Deal

This is a move borne somewhat out of necessity for BetMGM, who currently sit fourth in market share behind FanDuel, DraftKings, and Caesars.

Avatar photo

Published

on

blank

Our current economic recession is hitting companies across the country and the world. Cutbacks are happening in nearly every industry, and more are sure to come as interest rates go up and supply chains still in disarray from the pandemic shutdowns. Few industries are recession-proof, but sports might be one of them. Bloomberg thinks so, at least, per an article on Sunday where they discussed the sale of professional sports franchises and how they deem them a “recession-proof investment” for potential buyers. Sports books like BetMGM can’t be viewed in that same prism.

Sports books have not only publicly stated their need to rein in some of their spending, but their bottom lines have proven this to be the case as well. Numbers from the first part of this year have shown every book projecting heavy losses for the 2022 calendar year. Even FanDuel, who controls more than half of the betting market in the United States, reported a loss of nearly $150 million in the first half of the year, despite bringing in nearly $1.2 billion in revenue.

That’s what makes BetMGM’s deal with NBC Sports stand out. Many noticed the absence of PointsBet’s segments during Football Night In America during the first two weeks of the season, which came about due to PointsBet no longer being an authorized partner of the NFL. As such, they could not be present during NFL broadcasts and associated shows, such as FNIA.

Enter BetMGM, whose announcement of a partnership with NBC on Sunday did not disclose financial details. Per the press release, the book will be featured on FNIA with weekly integrations, as well as have a heavy presence in all of Matthew Berry’s programming on Peacock, including his daily show Fantasy Football Happy Hour and his Fantasy Football Pregame show on Sunday. In addition, Chris Simms will feature them on his Unbuttoned podcast.

This is a move borne somewhat out of necessity for BetMGM, who currently have about one-third of the sports betting market share of FanDuel, and regularly trail DraftKings. While the financials are unknown, one can reasonably assume it was a substantially higher number than the five year, $400 million deal that PointsBet signed with NBC–which also included nearly five percent equity in the book. BetMGM reported a second quarter loss of $72.2 million, and this is sure to impact the bottom line even further.

Sports books have become more focused these days on maintaining their customer base and increasing re-deposits, versus acquiring new customers and offering lavish bonuses. That’s what makes this move quite the gamble for BetMGM. While it is prime real estate on what the press release calls “the most-watched studio show in sports”, it’s mostly a one-game advertisement for the book. Although they feature in Berry’s daily content, I’m not sure how many people are tuning into programming on Peacock, especially with it hidden behind a paywall.

PointsBet is taking a stance that is more indicative of where the smaller books are prioritizing their spending, especially when it comes to advertising. In an interview earlier this month with Sports Business Journal, the Chief Strategy Officer for PointsBet, Eric Foote, discussed how it makes no sense for them to spend big bucks on NFL advertising when they’re paying a premium to reach customers in states where their services aren’t even offered, such as California.

Foote also stated they are “doubling down on local and regional assets,” with SBJ reporting PointsBet will spend nearly $400 million on their local NBC-owned stations and regional networks before the end of 2025. For an entity that takes in less than three percent of all sports wagers placed in the United States, this is a prudent strategy. It’s also one that you’re seeing more from other books such as BetRivers, who are prioritizing local sports radio spots over television ads on major networks.

Front Office Sports reported this weekend that GeoComply, the service used by most online sports apps to ensure a customer is within the boundaries of a state, processed more than 103 million geolocation verifications over the first four days of the NFL’s opening weekend. That’s an increase of more than 71% from last year’s opening slate, and that number will likely continue to rise in the coming years as states like Texas and California continue to discuss legalizing online sports wagering.

BetMGM is hoping that their increased presence with the NFL–which drives nearly 75% of all sports bets in the United States–will help them bring in more customers when sports wagering comes online in Ohio and Maryland at the start of the year. While their aggressive move will absolutely make the weekly FNIA segments with Berry and Simms more appealing to bettors, I’m not certain it’s going to mean much in the long term. With FanDuel’s market share continuing to increase every month and multiple smaller books fighting over the scraps, it remains to be seen just how successful of a gamble this really is.

Barrett Blogs

BSM’s Black Friday SALE on BSM Summit Tickets is Underway!

Jason Barrett

Published

on

blank

Each year I’m asked if there are ways to save money on tickets to the 2023 BSM Summit. I always answer yes but not everyone takes advantage of it. For those interested in doing so, here’s your shot.

For TODAY ONLY, individual tickets to the 2023 BSM Summit are reduced by $50.00. Two ticket and four ticket packages are also lowered at $50 per ticket. To secure your seat at a discounted price, just log on to BSMSummit.com. This sale ends tonight at 11:59pm ET.

If you’re flying to Los Angeles for the event, be sure to reserve your hotel room. Our hotel partner this year is the USC Hotel. It’s walking distance of our venue. Full details on hotel rooms can also be found via the conference website.

Continue Reading

BSM Writers

Media Noise: What Does The Return of Bob Iger Mean to ESPN?

Demetri Ravanos

Published

on

blank

Demetri Ravanos has questions about Disney going back to the future with Bob Iger. This entire episode of Media Noise is all about what the change at the top of the Walt Disney Company indicates about the future of ESPN.

ITunes: https://buff.ly/3PjJWpO

Spotify: https://buff.ly/3AVwa90

iHeart: https://buff.ly/3cbINCp

Google: https://buff.ly/3PbgHWx

Amazon: https://buff.ly/3cbIOpX

Continue Reading

BSM Writers

Media Noise: What Is Realistic For FOX at the World Cup?

Demetri Ravanos

Published

on

blank

On this special holiday edition of Media Noise, Demetri Ravanos dives into the controversy and criticism surrounding FOX’s coverage of the World Cup in Qatar.

ITunes: https://buff.ly/3PjJWpO

Spotify: https://buff.ly/3AVwa90

iHeart: https://buff.ly/3cbINCp

Google: https://buff.ly/3PbgHWx

Amazon: https://buff.ly/3cbIOpX

Continue Reading
Advertisement blank
Advertisement blank

Barrett Media Writers

Copyright © 2022 Barrett Media.