As the Super Bowl approaches this Sunday — the holy of holies for so many sports fans, even as some baseball nerds shrug — new developments are showing that when it comes to digital and mobile commerce, sports wagering and other forms of betting promise to produce much activity in the new few years to come.
The latest news, via Bloomberg this week (Jan. 29), has Penn National Gaming Inc. spending some $163 million to buy a stake in Barstool Sports, founded in 2003 and described by the news source as a “controversial sports and pop-culture blog.” Penn National reportedly will spend another $62 million or so over the next three years to increase its stake to 50 percent of Barstool Sports. The deal, according to Bloomberg, providing “the latest sign of convergence in sports, media and gambling. Penn National will be Barstool Sports’ exclusive gaming partner for as long as 40 years. The cash and preferred stock deal values Barstool Sports at about $450 million.”
Branding Power — and New Apps on the Way
Barstool Sports in 2017 came under fire for comments made by some of its personalities that were considered “insulting to women,” according to the news outlet. “The site has a daily feature with photos of a scantily clad woman called Smokeshow and in the past rated the attractiveness of teachers who were charged with having sex with their students.” Not only that, but, according to Bloomberg, “the company recently reached a settlement with the National Labor Relations Board to delete tweets in which [Founder Dave] Portnoy threatened to fire people who talked to union activists.”
Even so, one of the main ideas behind the new deal is to use the Barstool brand to further Penn National’s expansion into legal, online and mobile sport wagering, the doors for which were opened by a U.S. Supreme Court decision in 2018 to allow such activity in all states if they so choose. Penn reportedly will add the “the Barstool name to as many as 20 casino sportsbooks in states that include Pennsylvania, Michigan and Illinois by the end of the year. Barstool writers and commentators will make appearances at Penn properties, creating events that bring in a younger audience.” Penn also plans to launched a betting app that carries the Barstool app — not in time for this weekend’s NFL championship game, of course, but in time for the start of a new football season later this year.
Similar deals have already happened, underscoring the appeal of bringing together gambling with other parts of the wider digital ecosystem. For example, Bleacher Report, a millennial-focused sports website, has been steadily expanding into the sports betting space, attracting a new generation of gamblers who don’t consider sports gambling a bad thing, according to a report by CNBC.
Gambling Expansion — and the Super Bowl’s Role
A closer look at football betting serves to illustrate how attractive online and mobile betting is becoming in the U.S., and why one can reasonably expect much more activity in the coming year, whether through moves that involve betting only, or wider efforts, such as the Penn-Barstool deal, that involves media and other activities.
For Sunday’s Super Bowl, some 3 million more U.S. consumers will place bets of various types than was the case last year — a reflection of the growth of wagering in this new legal environment, according to the American Gaming Association (“gaming,” of course, being the “pre-owned car” substitute for “gambling”). “Nearly 5 million will place a bet through an online or mobile platform, either through a licensed, legal operator or an illegal offshore book, a 19 percent increase from last year,” the trade group said.
In total, some 26 million U.S. consumers will make Super Bowl bets. That translates into about one of every 10 people in the U.S. placing wagers in hopes of a positive payoff on either the outcome of the game or other components. “Americans will wager approximately $6.8 billion on the NFL championship game between the Kansas City Chiefs and San Francisco 49ers,” the trade group estimates. (For the record, those bettors are wagering more often on a Kansas City Chiefs victory over the San Francisco 49ers.)
At least 14 states now offer legal sports wagering, which much of that activity taking place on — or migrating to — online and mobile channels, according to the trade group. Six more states plus the District of Columbia are expected to join that wave later this year. “Since the U.S. Supreme Court overturned the Professional and Amateur Sports Protection Act in May 2018, more than $17 billion has been legally wagered on sports,” the trade group said.
As the Super Bowl approaches, it’s clear that legal gambling will continue to spark deals and other activity in the wider digital and mobile worlds. Stay tuned for eWinners and eLosers.