BlueBet Departing US Sports Betting Market

Posted on: August 29, 2024, 03:11h. 

Last updated on: August 30, 2024, 09:58h.

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

Australian sportsbook operator BlueBet said it’s withdrawing from the US market to focus on its sports betting business in its home country.

BlueBet
An image from a BlueBet commercial. The company announced it’s leaving the US sports betting market. (Image: YouTube)

The gaming company made the decision as part of its strategic review of its US operations, and it arrived about two months after BlueBet announced plans to leave Indiana. At that time, the operator indicated it intended to continue doing business in Colorado, Iowa, and Louisiana, but it also told investors the strategic review was ongoing. By leaving the US, BlueBet can better focus on its Australian business, which is thriving.

The company’s stated objective is to exceed 10% market share in the short- to mid-term through a combination of organic and inorganic growth,” according to a statement. “It is confident its expertise in building and scaling Australian wagering operators and ongoing investment in technology will deliver outstanding experiences for customers and create value for shareholders.”

BlueBet acquired Aussie rival Betr in April, combining the buyer’s technology stack with the target’s strong customer base. By leaving the US, BlueBet can focus on tapping synergies in that deal.

BlueBet Will Save Cash By Leaving US

Although the US is the newest large regulated sports wagering market in the world, it’s fast become one of the most competitive and expensive to operate in. Those costs especially weigh on smaller operators such as BlueBet.

To that end, there are cost benefits for BlueBet in leaving the US. The gaming company told investors it could save $4.07 million to $5.42 million annually, based on current exchange rates, by shuttering its US sports wagering business. Headwinds to BlueBet’s business-to-business Sportsbook-as-a-Solution (SaaS) were among the reasons the operator decided to leave the US.

“The decision to exit the US comes as slower than expected regulation has hampered total market growth and hindered interest in the company’s B2B SaaS platform, which BlueBet viewed as a significant opportunity,” the company added in the statement.

Though it didn’t mention any rivals by name, BlueBet acknowledged the difficulties smaller operators face in the US when going up against larger rivals. Currently, the US sports wagering is essentially a duopoly controlled by FanDuel and DraftKings.

With BlueBet, US Sports Betting Casualties Piling Up

With BlueBet confirming it’s abandoning the consumer-facing side of the US sports betting market, “deaths” in the space are piling up at a rapid pace. BlueBet’s decision arrived less than two weeks after Betfred said its considering a similar move.

Before that, Fubo Sportsbook, FOX Bet, MaximBET, PointsBet US, Tipico, and WynnBET, among others, announced plans to give up on US sports betting or be acquired. Add to that, Super Group (NYSE: SGHC), the parent company of Betway, said it’s leaving the US sports betting market while SuperBook owner Westgate said it will no longer offer mobile betting in any state outside of Nevada.

BlueBet added that it will continue to seek monetization of its technology assets in the US and abroad. It expects to take one-time charges related to the closures of its various state-level operations.