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World Congress of Sports

U.K. provides American operators in-venue wagering model

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In the United Kingdom, placing a wager at a professional sporting event is as commonplace and interwoven with the fan experience as going to a concession stand and buying a hot dog and a beer.

 

Whether that happens in the United States, even if the Supreme Court clears a path to legalize sports wagering, remains to be seen. But even before a decision is rendered, entities across the sports industry are actively plotting how in-venue betting can similarly become a fundamental part of the American fan experience.

 

BD Sport Group, which has struck a dominant position as a back-end service provider aiding major British bookmakers such as William Hill and Ladbrokes with in-venue wagering, last year became part of New York-based Orange Capital Ventures. And part of the strategy behind Orange Capital’s acquisition of BD Sport Group’s parent company included a potential expansion into the U.S.

 

“Clearly, we’d like to be part of it, if it happens,” said Tony Warwick, BD Sport Group co-founder and joint managing director. “We want to replicate what we do here [in England] in the U.S. We are ready and have the infrastructure and [intellectual property] in place.”

 

Leading daily fantasy sports operator DraftKings already has taken some similar steps in this direction, opening several branded lounges at arenas and stadiums around the country over the past several years where fans could gather and play daily fantasy during the course of a real-life game.

 

And more recently, DraftKings has hired a head of sportsbook with experience in the U.K. gaming space, based him in a newly opened company office in Hoboken, N.J., and is preparing for a legal landscape where U.S. gambling laws likely vary significantly by state.

 

“Our big thing is being very nimble and flexible, and prepared for every potential outcome. Whatever makes business sense and regulatory sense, we’ll want to do,” said Jason Robins, DraftKings co-founder and chief executive. “We all agree that this could be a very big market, and in-venue is a great way to reach fans. But what this could look like and what it will look like will probably be two different things.”

 

Among the key questions to be resolved in a legalized U.S. gaming landscape is precisely how interactive and technology-driven an in-venue wagering scenario will be for fans. In the U.K., fans can bet through a wide variety of means, including kiosks, online and on mobile-based platforms. And in the U.S., mobile platforms now represent the vast majority of content consumption for most major sports programmers, suggesting similar interest in sports betting through smartphones.

 

But Warwick said traditional cash-based betting windows in the concourses and luxury suites of U.K. soccer stadiums remain popular as many fans still prefer a human interaction as part of their match-day experience.

 

“The back-end behind these services and managing the cash flows and activity is certainly very high-tech, but that low-tech style of betting from the fan perspective is still very much there,” Warwick said. “Going to the match and placing a small bet, that’s simply part of the day for many fans.”

 

Warwick said BD Sport Group’s average in-venue wager is about 20 British pounds, and predicts a typical American fan would similarly wager about $25 and $30 at a game, should it become legal. The total amount bet at a normal U.K. football match amounts to 50 or 60 pence per person in stadium, translating to more than 30,000 pounds wagered per match at the larger Premier League stadiums. Warwick said even higher amounts could occur in the U.S. given the longer duration of games in the NFL, NBA and MLB. 

 

Following a Supreme Court ruling, the pathway toward any in-venue wagering would require, in the words of Robins, “a lot of hands in the cookie jar.” Approvals likely would be needed from not only state and local jurisdictions, but also the leagues, teams, venue owners, and labor groups such as players associations. And battle lines are already forming in many states regarding the splits around potential gaming revenue.

 

Lee Zeidman, Staples Center president, said the building is “always open to new ways to enhance the guest and fan experience” that a legalized betting landscape could bring. But he similarly pointed to the long series of legal and tenant approvals needed to make in-arena betting happen even at just that one arena.

 

Warwick similarly has a long view and points to the decades of U.K. regulation and established betting culture around sports wagering that has led to the current situation there.

 

“This is going to take a while to build up all the protective infrastructure needed to really make this happen” in the U.S., he said. “In-venue is probably not the first thing on the list to happen following a ruling. It’s maybe third or fourth on the list. But I could see something happening in this area perhaps by 2020 or 2021, and then becoming a key part of what we’re talking about.”

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