Between the Lines – American Gaming Report -March 2024

Catena Media is offering North America gambling industry insights via Adam Candee, Editor-In-Chief of Legal Sports Report.  Catena will offer Candee's in-depth look at the US industry every month with trends and news in regulation, legalization and the companies involved in the space.

The early days of legalized US sports betting made it look easy. State after state passed laws. Company after company lavished bonuses upon customers. Could it really be as simple as throwing open the doors and drinking from an endlessly flowing firehose of cash?

Nearly six years into the nascent industry, the answer to that question is clear: no, it is not that simple.

Another Sportsbook Exits the US Market

Sports Illustrated once stood as the paragon of journalism in its vertical, an unimpeachable brand that resonated throughout the industry.

The magazine is a shell of that titan today. That became evident again last week as its once-mighty brand exited the US sports betting market following a forgettable run as the face of 888 in the states.

London-based gambling heavyweight 888 will pay SI’s parent company $50 million over the next five years to terminate the deal early. The partnership produced minimal handle share in its active states.

“In the US, the intensity of competition and requirement for scale means huge investment is required to reach profitability,” said 888 CEO Per Widerström. “Our partnership with Authentic has consistently driven strong demand for the SI brand across both consumer experiences and product offerings.

“A series of record-breaking months for SI Casino has underscored the strength of the SI brand. However, despite these successes, we have concluded that achieving sufficient scale in the US market to generate positive returns within an accelerated timeframe is unlikely.”

SI is far from alone in the graveyard. MaximBet and Fubo Sportsbook shuttered. Penn Entertainment wrote off a massive loss to get out of its Barstool deal. PointsBet sold its US assets to Fanatics for a fraction of its investment in a US market, proving increasingly difficult to crack without some combination of standout tech, strong player database, and brand recognition.

PUSA - Another Gambling Bill Faces Tall Hurdles 

The velocity with which states passed sports betting bills following the 2018 repeal of PASPA surprised even the most cynical observers.

Online casino, however, remains a tougher sell with state legislatures throughout the country. This year’s prime example comes from Maryland, where legislators are debating an online gaming bill that appears destined for the back burner.

Concerns over diversity and inclusion most recently caused a slowdown in committee. Local casinos threw up the preceding roadblock when dozens of union workers testified that online gaming would endanger their jobs at brick-and-mortar casinos.

Just seven states have some form of online gaming right now:

• • Connecticut 
  • Delaware
  • Michigan
  • Nevada (poker only)
  • New Jersey
  • Pennsylvania
  • West Virginia

That figure pales in comparison to 30 states allowing some version of online sports betting. It also underscores not only the direct challenges to passing all gambling bills but the indirect ones, such as competing political interests (Georgia) and filibustering Senators (Missouri.)

New York also is trying to legalize online casino in 2024, with minimal chance of success.

Another State Goes Online, But No One Else is in Line

Anyone with an internet connection and so much as a passing interest in gambling already knows that North Carolina launched online sports betting on March 11.

What no one knows, however, is which state next will open its doors to online sports wagering.

The North Carolina launch drew massive attention from throughout the country. Beyond its apparent status as the only guaranteed state opening in 2024, North Carolina featured the debut of Underdog Sportsbook and fellow newcomer ESPN Bet’s first starting-line competition with industry heavyweights FanDuel and DraftKings.

North Carolina could generate $6 billion in handle in its first 12 months of operation, according to Legal Sports Report. That figure would place North Carolina comfortably into the top 10 markets in the United States.

Yet no state appears close to passing online sports betting legislation this year. That means sportsbooks will need to turn their focus inward on product and retention instead of relying upon their tested launch playbooks for acquiring new customers.

 

 

About the author

Adam Candee is the Editor-In-Chief of Legal Sports Report. He joined LSR in April 2018, just a month before the dawn of today’s US sports betting industry. Adam earned national and regional awards as a newspaper reporter at the Las Vegas Sun and Arizona Daily Sun for breaking news, feature, and opinion writing. His team at KLAS-TV earned the Edward R. Murrow Award as the best television news website in the country in 2013. Adam also is a two-time Arizona sports columnist of the year and a Golf Writers Association of America honoree. A proud graduate of Northern Arizona University, Adam also volunteers as an editor for Kiva, a non-profit that specializes in microfinance in underprivileged parts of the world.