The amendment of the Federal Wire Act has deprived Nevada of its monopoly over the legal gambling business. Soon after, other states have joined the race to capitalize on what could soon be a significant part of the global $155 billion market. Surprisingly, established betting companies might not be the big winners here. Sophisticated technology companies focused on user acquisition could offer their services to help big players take a larger slice of the market, for a price.
The U.S. after the prohibition
After more than half a century of sports betting prohibition, the United States Supreme Court has lifted the federal ban on full-fledged sports betting outside Nevada (PASPA). With the ban being gradually replaced by state laws, the mass of bettors attached to the black market can finally start to use official means. The legalization has acted as a trigger and unveiled the pre-existing black and grey market demand for sports betting in the United States.
Since May 2018, 38 states representing almost 90% of the adult U.S. population have introduced more than 150 bills on sports betting. This pace sparks many hopes and opportunities, but also becomes the main challenge on the market, as each state approaches the legislation differently. Debates on taxation and implementation complicates the already tricky legal landscape, as states race to monetize on the first-movers advantage.
So far, thirteen states have legalized sports betting, seven others have already passed the bills, and more than a dozen are just behind. The rapid tempo of legalization across the U.S. has expanded the market and significantly broadened the potential consumerbase. Not limited by the states’ boundaries, online betting companies start to stretch across the country and build up momentum faster than any other brick-and-mortar business.
Online sports betting goes boom
As betting in the U.S. has mostly stuck to a business model straight from the sixties, the emergence of online betting is like a true revolution in the industry. Despite living in the digital age, not everyone believed in it – like the state of New York. Putting faith in old school casino betting and brick-and-mortar betting points wasn’t enough to grab the hearts of New Yorkers. They prefer traveling to New Jersey to place bets online, while their state gives up on an estimated $75 million in taxes annually.
People like to place bets online. It’s just so easily-accessible, fast, and attractive. After all, who doesn’t like to take wagers even with themselves? With the popularity of online applications and services, a mass of underserved bettors has finally got an opportunity to legally wage in the most streamlined way possible. From the palm of their hand, in virtually any environment, at any time.
Early statistics show that as much as 83% of bets in betting-friendly states are placed online. Pennsylvania seems to lag, with just 40% of bets done digitally, but if we take under consideration only one sportsbook app functioning in that state, that number suddenly seems worthy of mention.
A rough start
Pennsylvania’s example proves that there is more to running a successful betting business than just setting up your operations. What chokes most of the infant betting ventures is the high cost of acquiring new bettors. Last year, an online casino operating in New Jersey had to pay up to $500 to get a new client. Most of that cost is marketing expenditures and lucrative bonuses that fuel the new user’s account.
Finding the right audience, tapping into their sentiments, and finally swaying to place a bet is a long road. Due to the numerous competition, companies have to go far to convince users to their particular service, thus driving the costs of acquisition even higher. Times when striking an affiliate deal with relevant websites was the key to ultimate victory are over. With affiliate programs not succeeding in the same way as before, betting companies have to pull out their aces to cut through and reach towards new customers.
The choice of champions
The key to cutting acquisition costs is technology. The football predictions app Probet offers users access to free analytics data predicting the results of upcoming matches. The platform then offers a way for users to connect directly with betting platforms, maximizing engagement by providing users with data they want to make better decisions.
Probet focuses upon soccer/football and as such its primary markets are in Europe, South America, Africa, countries where football is a religion. The concept leverages technology to provide something that both bettors and betting companies need and could be applied to any number of sports, including American Football or Basketball.
With the Federal Wire Act out of the way, fortunes are going to be made and lost. Regardless of the result, the ones likely to win are online betting companies. With proprietary AI-powered solutions and a dynamic business model, it seems that Probet might get well ahead of its competition. The odds are on Probet – what’s your bet?
DISCLAIMER: This article was written by a third party contributor and does not reflect the opinion of Born2Invest, its management, staff or its associates. Please review our disclaimer for more information.
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