Will 2023 prove to be a pivotal year for the American online sports betting market, and if so, how? It is understandable to have such a question after all the recent events that have surrounded the vertical, but it is risky to overestimate the likelihood of these events occurring in the future. An industry’s development and the final, consolidated form it will take are greatly influenced by how it changes, especially in its early years.
The fact that operating in the U.S. and around the world’s online sports betting industry is extremely expensive, low margin, and occasionally volatile has already caused a number of operators, both big and small, to fold or drastically reduce their scope.
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Much larger U.S. companies have also given up on their goals, including iGaming, which recently sold its market access contract to online skepticism and whose wagering figures are unknown, probably due to their extremely low levels.
This company was the first to attempt to succeed in online sports betting, and in this case, industry observers wisely nodded their heads in recognition of how difficult it is to harness the power of broadcasting and combine it with sports betting. The fact that each of these groups has the same idea when it comes to focusing on iCasino states, however, also highlights the limitations of the new strategy.
Considering the market
If the relevant legislative projects are successful, the total addressable market for retail and online sports betting in the United States would reach roughly 60% of the adult population by the end of 2023, or roughly 144 million adults in legalized jurisdictions, the analysts explained in a note published at the end of December. No regulatory project will include California and Texas this year, despite the size and wealth they would bring, and the rise in Americans who can access legal online sports betting.
Despite hopes that Florida will eventually regulate, the legalization of mobile gambling is still up in the air and is likely to run afoul of the law in the Sunshine State. According to this regulatory scenario, sportsbooks won’t be able to access the states that would alter the volume and scale of their iGaming business while also adding significant marketing costs for a while, despite the increase in user numbers.
New igaming businesses are eagerly awaiting the long-awaited arrival of betting sites on the market. Given that research just raised $700 million, which it plans to use for a push into betting and gaming, this makes sense. Millions of sports fans can be reached through the organization’s sports apparel business. Fanatics is touted as the best cross-loyalty programme in sports because it rewards fans by giving away merchandise in the post’s comments.
The Australian bookmaker Pointsbet is in negotiations to possibly sell its Australian-facing business to the group that runs the Australian betting brand. Should it be successful Down Under, it might open the door for it to merge its U.S. operations with another midsize group, but the negotiations also highlight the expense of its operations stateside.
According to Earnings + More, its revenue is made up of 80% sales and marketing costs and 59% cost of sales. Like other second tier operators, Pointsbet is under time pressure to finalize a deal in the United States. Online gaming will likely become more popular in 2023; it is already available in many countries. Due to its low profile, it has been able to carefully study the market; however, whether or not its app will be able to successfully draw in enough players and deliver a top-notch user experience will be the deciding factor.