Bet365, Fanatics Could Eye Arizona Entry

Posted on: July 27, 2023, 03:59h. 

Last updated on: July 27, 2023, 04:22h.

Todd Shriber @etfgodfather Read More
Expertise: Financial, Gaming Business, Mergers and Acquisitions.

Bet365 and Fanatics could be among the sportsbook operators competing for three new licenses in Arizona.

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Arizona Cardinals fans line up outside the BetMGM Sportsbook adjacent to State Farm Stadium. Bet365 and Fanatics could apply for Arizona sports betting permits. (Image: ABC15 Arizona)

When the state approved sports wagering in 2021, it made allotments for 20 permits. Currently, 17 licenses are spoken for. The Arizona Department of Gaming (ADG) will award two licenses to professional sports teams partnering with gaming companies, and one to a tribal entity. It’s possible the tribal permit will be extended to the Ak-Chin Indian Nation, which was left without an online sports wagering partner when Fubo shuttered its sportsbook operation last October.

That group of 17 includes Bally Bet, Barstool Sportsbook, Betfred, BetMGM, BlueBet, Caesars Sportsbook, DraftKings, FanDuel, Golden Nugget, Hard Rock International, and SuperBook Sports. Bet365, which is one of the largest sportsbook operators in regulated markets outside the US, and upstart Fanatics could attempt to join that cadre.

Two candidates stand out: bet365, which launched in Colorado just last fall and, per our estimates, has captured an impressive 6% market share in the last three months, and big-intentioned Fanatics,” noted research firm Eilers & Krejcik Gaming (EKG).

UK-based Bet365 is widely viewed as having the resources to become a legitimate player in the US sports wagering market. It’s operational in Colorado, New Jersey, and Ohio and has market access in Pennsylvania.

Colorado Comps, Arizona Tough Market

In the early stages of the US sports betting boom, the operating methodology of many sportsbook companies was to enter as many states as rapidly as possible while worrying about profitability later.

That’s changed, and the evolution is relevant when discussing Arizona because the market is mature and is dominated by FanDuel, DraftKings, and BetMGM. That trio controls 84% of the mobile wagering market there, according to EKG. The research firm calls that grip “a barrier to entry.”

Still, Arizona is a compelling market for ambitious sportsbook operators and the comparisons to Colorado are pertinent.

“Colorado’s population of about 2% of U.S. adults, reasonable tax and fee structure, and generous market access landscape (i.e., 20+ skins), are all comparable to Arizona,” observed EKG. “Colorado supports 24 OSB brands, compared to Arizona’s 17.”

Who Else Could Consider Arizona?

Bet365 has the capital to make a go of it in Arizona and Fanatics is committed to expanding its sports wagering footprint, making both logical entrants to Arizona although neither has publicly confirmed they’ll apply for permits there.

The process opens next month, and that will provide more clarity on the operators that desire Arizona entry.

One name to keep an eye on is Las Vegas-based Circa Sports. While the operator hasn’t confirmed it wants an Arizona license, it is live in Colorado. Additionally, given Arizona’s proximity to Nevada, Circa may have built-in brand recognition in the Grand Canyon State.