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Why DraftKings Merger Is A Winning Ticket For Bettors

Ryan Butler for Bookies.com

Ryan Butler  | 4 mins

Why DraftKings Merger Is A Winning Ticket For Bettors

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Another powerhouse merger could mean new betting options for states with DraftKings sportsbooks.

DraftKings, the daily fantasy sports provider increasingly expanding its sports gambling presence, merged with European betting technology provider SBTech, it was announced Monday. The move creates the latest gaming giant in the growing U.S. market and means more focus than ever on American bettors — and those same bettors will have more wagering options with DraftKings and new competitors looking to keep pace.

DraftKings to Bring New Betting Experiences

Bringing together a global gambling tech provider and one of the top names in U.S. gaming means more streamlined integration and more betting options, according to DraftKings CEO Jason Robins. The DraftKings founder, who will take over the combined company, told investors Monday that will mean unique gambling possibilities, specifically in-play wagering and parlay betting competitors won’t be able to match.

Most other gambling operators subcontract some or all of its technological components. DraftKings and SBTech will now be able to work many of these facets of operation under the same digital roof.

This is part of a larger strategy of vertical integration, which the new company will use to optimize odds compilation, risk management, user interface developments and a host of other behind-the-scenes components integral to an operator’s success. DraftKings is best known for its online offerings, but this same integration will also boost its brick-and-mortar sportsbooks as well. That furthers DraftKings broader vision to “forever transform” the way people experience sports.

DraftKings does so as part of an increasingly crowded online gaming sphere.

Why DraftKings Merger Is A Winning Ticket For Bettors 1

The merger will undoubtedly spark similar moves by its competitors. Rival FanDuel was already acquired by European gaming giant Flutter Entertainment, which also owns iconic global brands Paddy Power, BetFair and the Stars Group. American gambling companies MGM and GVC already merged, as did Caesars and Eldorado.

Meanwhile, DraftKings is battling FanDuel, another American company better known for its DFS products, for supremacy in New Jersey, the largest sports gambling market outside Nevada. The two combined for 77% of the Garden State’s online market share, with FanDuel holding a narrow 40%-37% edge. Both are far ahead of third-place William Hill (14%) and fourth-place PointsBet (4%).

Both DFS operators have a huge edge from brand recognition earned after years of seemingly ubiquitous advertising for its flagship product. Robins said Monday that 98% of DraftKings online iGaming users in New Jersey had been cross sold from the company’s other products. Meanwhile about 40% of all DraftKings users in New Jersey have used the digital sportsbook.

Check out the full list of Sports betting sites in New Jersey

Nationwide Developments

New Jersey is not the only state that should see an experienced DraftKings experience.

Four states now offer DraftKings mobile betting (New Jersey, Indiana, Pennsylvania, West Virginia). There are also retail locations in Iowa, Mississippi, New Jersey and New York.

DraftKings will likely enter online betting markets in several additional states in 2020, including Michigan, Colorado and Tennessee. The Boston-based company is also set to be the sole online and retail operator in New Hampshire, which expects to take its first bets by the end of December.

At least a dozen more states are expected to take up legislation to legalize sports betting next year, joining the 20 that have done so already. DraftKings expects at least 65% of the U.S. population to have access to legal sports betting once the market reaches full maturity in the coming years. Notably, heavily populated states such as California (highest population), Florida (third) and New York (fourth) are floating the idea of online sports betting.

Practically, this means the bettors in a handful states with DraftKings sportsbooks are about to have even more betting options than ever on prominent American sports leagues such as the NFL, MLB, NHL and NBA, but also dozens of lesser known and foreign leagues. This will carry over to individual player props, in-play betting and parlay options, all of which will be easier than ever to manage and promote by the combined company.

The merger also means companies from around the world continue to view the U.S. as the more important growth market. That means there will be many more deals like the one struck by DraftKings and SBTech Monday, and even more sports betting options for players.

About the Author

Ryan Butler for Bookies.com
Ryan Butler
Ryan Butler has spent more than 10 years covering sports, governments and the intersection between the two.