How the sports-betting industry is responding to the coronavirus pandemic that has halted most major sporting events
- The legal sports-betting industry is scrambling to adapt to the lack of live sporting events, as major leagues cancel or postpone their seasons due to coronavirus concerns.
- Sports-betting companies, and the media businesses that had been rushing to capitalize on the industry, are cutting costs to keep their businesses afloat and finding creative ways to keep fans entertained while much of the sports world is in limbo.
- Online-gaming companies, like FanDuel and DraftKings, are launching betting pools around topics like politics or TV shows, and looking to smaller and international events that are still playing, like horse racing, rugby, and Australian A-League soccer.
- All eyes are also on the fall NFL season as the next big comeback opportunity for sports betting.
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The coronavirus pandemic has dealt a blow to the legal sports-betting industry that was poised to take off in the US in 2020.
Major sporting events, including the college-basketball betting frenzy known as March Madness, have been canceled. Others, like the NBA, NHL, and MLB seasons, are on hold.
Sports-betting companies, and the media businesses that had been rushing to capitalize on the industry, are now cutting costs to keep their businesses afloat and finding creative ways to keep fans entertained while much of the sports world is in limbo, industry insiders told Business Insider.
For some sports betting and media companies the name of the game right now is cutting costs and conserving capital.
Product launches that had been planned around major sporting moments like March Madness or MLB's opening day are being paused. Some marketing campaigns are also being pushed.
"Everybody is hunkering down and preparing contingency plans to keep their businesses operating," said one industry advisor, who has advised multiple media companies that are moving into sports betting. "They're thinking through how to, frankly, preserve their employee bases and trying to avoid having to lay people off."
Read the full story about how the sports-betting industry is responding: Sports-betting insiders say companies are in 'triage mode,' cutting costs and getting creative to keep fans interested until live sports return
Physical sportsbook operators are in the toughest spot, because they own massive casinos and retail locations that have mostly been shut down.
"They don't have any customers now," said Chris Bevilacqua, cofounder of Bevilacqua Helfant Ventures, an advisory and investment firm for the sports and entertainment industries. "A lot are going to undergo some financial hardship."
Online-gaming providers, including daily-fantasy-sports companies FanDuel and DraftKings, are leaning on their daily-fantasy businesses to weather the rough economic climate. They're launching betting pools around topics like politics or TV shows. And they're looking to smaller or international events that are still playing, like horse racing, rugby, or Australian A-League soccer.
Read the full story about the most-exposed companies: The sports-betting companies threatened most and least by the coronavirus pandemic, according the industry insiders
Meanwhile, with the current and spring NBA, NHL, and MLB seasons on hold, all eyes are on the fall NFL season as the next big comeback opportunity for sports betting.
"Hopefully in the fall with the NFL season, you'll have new, innovative next-gen looking sports-betting platforms," said Wayne Kimmel, at venture-capital firm SeventySix Capital, which invests in sports and technology companies. "It all depends upon if everyone can stay healthy and if we have a season. There's a lot of question marks."
Read more the full story about the opportunity around the NFL: US sports-betting companies are planning a resurgence around the NFL season and its delay would be a 'worst case scenario'
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