Second-tier sportsbooks will hardly reach profitability in Massachusetts at market maturity as they will need between 7% and 8% of the total market share to be profitable and this seems a steep climb for them.

Doomed from the Launch?

With the retail sports betting market in Massachusetts already live and the online sportsbooks less than 10 days from launch, independent consulting firm Eilers & Krejcik Gaming came up with an explanation for why some of the second-tier operators did not apply or have withdrawn applications.

Building its scenario based on PlayMA’s market projections at maturity of $5.7 billion in sports betting handle, the consultancy estimates that to reach profitability each sports betting operator would need between $32 million and $36.6 million in annual revenue.

For the big three players on the US sports betting scene, FanDuel, DraftKings and BetMGM, and several others, including Caesars Sportsbook, which went live ahead of the official market launch, and Barstool Sportsbook, generating such revenue would be easily achievable, for smaller sportsbook operators gaining such a market share is a tough call. Hence, BetRivers did not even bother to apply while others such as bet365 and PointsBet withdrew their applications.

Asked why the sportsbook decided to pull out of the running in the final hour, PointsBet’s director of communications, Patrick Eichner, did not provide a direct answer but rather outlined that the company had elected to “best optimize” the market where it already has operations comprising 13 US jurisdictions and Ontario.

There is also one big question mark in the analysis that relates to the handling of promotional write-offs by the State of Massachusetts as it is the biggest uncertainty in PlayMA’s market maturity projections.

Applying a scenario consistent with other states where the promotional deduction is 40% of gross revenue and around 3% of the betting handle, the analysis believes promotional bonus bets have the potential to boost the handle between 2% and 4%, or about $100 million, and based on the national average sportsbook hold of 8%, argues that operators’ revenue could be around $7.9 million higher with the promotional bets included.

The analysis claims that sports betting revenue for the state at market maturity could reach $87 million which is significantly higher than the projected by state lawmakers of $60 million but all would depend on the state’s approach to promotional write-offs.

Room for Thought It remains unclear how the consultancy came up to the conclusion that for smaller operators reaching 7%-8% of market share would be steep especially when 8% is the national average sportsbook hold. Are small sportsbooks doomed elsewhere too?

The two companies have entered into a multi-year partnership that will see the ORAKO solution deployed with the Puerto Rico-based sportsbook and help it deliver excellent experiences for players, as the company prepares to roll out its fully-fledged sportsbook product.

Ballers Sportsbook to Get a Strong Start in Puerto Rico

Ballers Sportsbook customers will have access to an extensive library of betting markets secured by Sportradar which will help registered users bet on a number of markets and sports. ORAKO brings along with it the opportunity to place a wager on player props, in-play, futures, teasers, moneylines, parlays, and more.

Ballers is planning to incorporate the ORAKO sportsbook solution with the R. Franco Digital PAM giving the company a full 360-degree omnichannel player experience. Ballers Sportsbook is expected to arrive at some point in the second quarter of the year, with Puerto Rico regulating its sports gambling industry only recently.

Commenting on this partnership, Ballers Sportsbook founder Daniel de Ontanon welcomed the opportunity to welcome Sportradar’s solution and implement it with the upcoming online sports betting experience which will deliver on one of the best possible platforms in Puerto Rico over the coming months. De Ontanon said:

We are tremendously pleased and excited to count one of the world’s most prestigious sports betting and gaming platform providers as our partner.

Ballers Sportsbook founder Daniel de Ontanon

Excellent Sportsbook Solution with Local Flavor

The executive added that the sportsbook operator was committed to providing a unique and tailored experience to players with a true local flavor. Sportradar managing director managed sportsbook services Jacob Lopez Curciel explained that Puerto Rico is an important part of the Americas and therefore a growth opportunity for the company.

“We are pleased to power Ballers Sportsbook through our ORAKO solution and use the breadth of Sportradar’s technical capabilities to cover the full scale of the sports betting spectrum,” Curciel concluded. The launch of sports betting in Puerto Rico took some time as well.

The activity was officially passed into law in 2019, but the next three years were rife with debate about when the actual rollout of sportsbooks should happen. In the meantime, Sportradar was able to introduce its ORAKO solution in 2022, enabling Ballers Sportsbook to now benefit from it.

BlueBet, a mobile-first online wagering provider based in Australia, has announced its half-year financial results for the six months which ended on December 31, 2022, (H1 FY23). 

BlueBet Posts Negative EBITDA and Profit After Tax

BlueBet’s turnover increased by 6.1% to AUD280.5 million ($189.3 million) in H1 FY23, with strong growth in sports and mobile. However, the net win decreased by 5.1% to AUD27.1 million ($18.3 million) due to a shift in the mix to sports and increased promotional investment. 

The company’s gross profit decreased by 10.7% to AUD13.1 million ($8.8 million), while EBITDA was negative at AUD10.5 million ($7 million) and profit after income tax was negative at AUD9.9 million ($6.7 million).

Despite these challenges, BlueBet has continued to invest in marketing and product to position itself for continued market share growth. The company soft-launched ClutchBet in Iowa in August, with the Colorado launch on track for H2. BlueBet also made a strategic investment in Low6, which allowed it to launch its first free-to-play game ahead of the NFL Super Bowl.

In addition, the company has continued to invest in product development, with the BlueBet Global Platform expected to drive scalability and operational efficiencies after its launch in late FY23. BlueBet is also exploring opportunities in the B2B Sportsbook-as-a-Solution model and has discussions underway with a number of potential partners.

Bluebet’s Objective Is to Achieve Positive Cash Flow

BlueBet CEO Bill Richmond commented that the company delivered a strong performance in H1, remaining focused on delivering its strategy and providing an excellent experience for its customers in the face of increased market competition. 

Richmond added that BlueBet is well capitalized to execute its growth plans in Australia and the US, and with a strong US team now in place, the company is well-placed to deliver its growth strategy in H2 and beyond.

Looking ahead, BlueBet’s priorities for H2 include returning its Australian business to positive operating cash flow, continuing to invest in product development, launching its first free-to-play game, and enhancing its US product by introducing HyperLive micro-live betting functionality. The company also aims to progress discussions around its B2B Sportsbook-as-a-Solution offering.

Despite some challenges in H1, BlueBet has continued its strong growth trajectory, driven by its differentiated brand and market-leading product. The company’s continued investment in marketing, product, and strategic partnerships positions it for continued market share growth in both Australia and the US.

The provider of eInstant games for lotteries, Instant Win Gaming (IWG), confirmed that since the start of the year, multiple record progressive jackpot prizes were awarded. The company said in a statement released Thursday that the Virginia Lottery, the New Hampshire Lottery, as well as the Michigan Lottery, had a stellar start of the year, awarding record-setting progressive jackpot prizes for the first two months of 2023.

IWG explained that the jackpots reaffirm the potential of the company’s progressive jackpot-powered games that deliver unique chances for high prizes to lottery customers around the US. Moreover, the announcement about the record jackpot prizes comes after a major prize was secured recently, in October. Back then, the Pennsylvania Lottery via IWG’s Big Keystone Jackpot eInstant awarded a $1.6 million jackpot.

The Supplier’s Presence in North America Grows

IWG’s CEO, Rhydian Fisher, congratulated the lotteries in Virginia, New Hampshire and Michigan for the record awards from the company’s eInstant progressive jackpots. He explained that the company is excited to continue to increase the reach of its leading products. Moreover, Fisher explained that by now, IWG has launched more than 70 progressive eInstant jackpots for North America.

“Congratulations to Michigan, New Hampshire, and Virginia lotteries for each setting eInstant progressive jackpot records.“

Rhydian Fisher, CEO at IWG

Fisher pointed out that the company’s progressive jackpot games help build the company’s experience which in turn improves the products for lottery players. “What I love about all these record-setting jackpots is that they leverage the combination of IWG game styles and technologies to drive this excitement,” he said.

According to him, the different technologies, such as InstantBoost and InstantJackpot, to name a few, meet the requirements of different lotteries. In conclusion, Fisher said that IWG is looking forward to seeing further growth in its products throughout 2023.

“It’s very exciting and we look forward to growing the jackpot category further in 2023.“

added Fisher

It was back in January when the Michigan Lottery, via its Monthly Jackpot second chance jackpot eInstant, awarded a record prize of $403,618. The game itself receives funding from a percentage of the sales and leverages IWG’s leading InstantReplay technology.

Then, in February, the Virginia Lottery awarded a record $785,414 jackpot prize from its Commonwealth Jackpot eInstants. Another progressive jackpot prize was awarded near the end of February by the New Hampshire Lottery. One lucky player that participated in the Lottery’s Premier Jackpot game, powered by IWG’s InstantBoost, secured a record-breaking $392,703 prize.