The growth of legal U.S. sports betting will shape the industry worldwide through regulations, social acceptance, and corporate consolidations in the next two years, a panel of CEOs said Tuesday at the SBC Barcelona Summit Digital.
“The U.S. coming in has changed the perception of gaming. It’s made it so much more acceptable,” said Paris Smith, a member of the Sports Betting Hall of Fame and CEO of Pinnacle, which has online gaming customers in more than 100 countries.
Giovanni Garrisi, CEO of Stanleybet, one of the largest operators in Europe, cited the sheer size of the American market. “When we speak about half a billion (dollars), they speak about five billion,” said Garrisi, one of the five newest members of the Sports Betting Hall of Fame.
The performance of DraftKings has been “awesome,” said Minja Bolesnikov, CEO of MaxBet, which operates in Serbia, Montenegro, Bosnia Herzegovina, and North Macedonia. “We have yet to see the impact, not only on the U.S. but on the entire industry globally.”
Alexis Murphy, CEO of BetFirst, which has Belgium’s biggest online sportsbook, predicted that U.S. operations will become “a tremendous catalyst” for mergers worldwide in the next 24 months.
The four spoke at an SBC Barcelona Summit Digital session titled “The Future Landscape for Sports Betting.” Simon Westbury, head of the sales department for iGaming software provider Digitain, moderated.
The panelists agreed that sportsbooks in general often operate under public misperceptions about how much money they make and how they get it.
“They think we make gazillions and everyone wants a piece of that,” Smith said, referring to governments, data providers, and others. “But I actually feel like globally, (the perception) is shifting in a more positive way.”
Correcting those misperceptions among the public and regulators will be essential as sportsbooks accept the promise and popularity of betting on esports, the panelists said.
A June market analysis by Grand View Research put the global esports market size at US$1.1 billion in 2019 and projected it will grow to $6.81 billion in 2027. Several universities have begun esports team and members of the Olympic Summit in December found “great potential” for sports simulations using virtual and augmented reality.
“The issue with esports is that there’s a seismic shift between different generations,” Murphy said. “Ultimately, it’s a leisure activity where there’s competition, skill, and a huge audience.” He acknowledged “significant challenges” in regulating esports, but added, “Regulators, governments, and operators are going to have to get their heads around it, because it’s not going to disappear.”
Smith said esports have been “phenomenal” for Pinnacle. “There’s a lot of competition coming in right now on eeports, so it’s a good opportunity for us to get in the forefront again.”
While acknowledging the strong interest in esports, Grassi worried that they involve far more of a game of chance than traditional sports.
Looking ahead at the industry’s next 12 to 24 months, Grassi said companies that failed to make investments during the COVID lockdown face a loss of market share. “Companies that were strong before will be weaker,” he said.
Smith predicted making “real profits” is going to become more important post-COVID and that will lead “massive” mainstream companies to get more interested in gaming.
Bolesnikov said regaining pre-COVID stability will be essential, so companies will focus on putting their finances back in order.
Murphy said retail gaming will change dramatically. “With the resumption of sports, most online activities have bounced back really well. In terms of broader retail, this crisis will have a lasting impact as habits change. People are going to have to innovate, restructure, think differently. In two years, retail environments will look very different from what they were a year ago.”
