{"id":273976,"date":"2023-05-17T16:24:23","date_gmt":"2023-05-17T21:24:23","guid":{"rendered":"https:\/\/www.casino.org\/news\/?p=273976"},"modified":"2023-05-25T06:04:52","modified_gmt":"2023-05-25T11:04:52","slug":"fanatics-represents-budding-problem-for-draftkings-fanduel","status":"publish","type":"post","link":"https:\/\/www.casino.org\/news\/fanatics-represents-budding-problem-for-draftkings-fanduel\/","title":{"rendered":"Will DraftKings, FanDuel Have Fanatics Problem? Possibly"},"content":{"rendered":"

Fanatics announced Sunday that it\u2019s paying $150 million in cash<\/a> for PointsBet\u2019s (OTC: PBTHF) US operations in a deal that provides the buyer with access to more than a dozen states.<\/p>\n

\"Fanatics
The Fanatics Sportsbook inside FedEx Field in Maryland. The company could pose a threat to the likes of DraftKings and FanDuel. (Image: Twitter)<\/figcaption><\/figure>\n

That means Fanatics doesn\u2019t have to wait for often slow-moving regulators to approve new license applications. With time often being of the essence in the sports wagering industry, Fanatics aims to offer mobile sports betting in 12 to 15 states<\/a> by the start of the 2023 football season. As such, the PointsBet acquisition could speed the buyer\u2019s competitive threat to incumbents FanDuel and DraftKings (NASDAQ: DKNG).<\/p>\n

Fanatics is expected to offer sports wagering in Massachusetts by the end of this month and is beta-testing its platform in Ohio and Tennessee. And while PointsBet had scant market share compared to FanDuel and DraftKings, the product Fanatics is acquiring typically scores well among end users.<\/p>\n

The PointsBet product may not be quite on the level of the top-2 but it is consistently third in the market by our proprietary testing. Backed by Fanatics\u2019 resources for product development and marketing\u2014and a massive database to market to\u2014the operator could take significant share in our view,\u201d said Eilers & Krejcik Gaming (EKG) in the latest edition of the EKG Line <\/em>report.<\/p><\/blockquote>\n

Conversely, Fanatics\u2019 sports wagering entry has been telegraphed for some time, and the company has been tied to a slew of takeover rumors over the past couple of years, indicating established rivals in the space likely weren\u2019t surprised by the PointsBet USA takeover news.<\/p>\n

Three\u2019s Company with Fanatics?<\/h2>\n

FanDuel and DraftKings combine to control about three-quarters of the domestic online sports wagering market. After that, only BetMGM, and to a lesser extent, Caesars Sportsbook, have cobbled together solid market share.<\/p>\n

Fanatics has the resources to make life hard on entrenched rivals, including $2 billion in cash on its balance sheet. But the privately held firm\u2019s behavior to date signals it won\u2019t overpay or make deals simply to add market share.<\/p>\n

\n

As EKG notes, through the PointsBet transaction, Fanatics gets access to critical technology by way of Banach Technology<\/a>, which PointsBet bought in Mach 2021 for $43 million. The research firm pointed out that Banach\u2019s platform could make Fanatics an immediate threat on the product front, and the business could be worth double or triple what PointsBet paid for it. There are other avenues through which Fanatics can assert itself in online gaming.<\/p>\n<\/div>\n

\u201cOnline casino technology is a logical next step while prices are still somewhat suppressed, with companies like White Hat Gaming and Strive Gaming logical targets. PointsBet has been planning to migrate to a Strive Gaming casino platform from its own technology for several months,\u201d added EKG.<\/p>\n

How Fanatics Could Squeeze DraftKings, FanDuel<\/h2>\n

It hasn\u2019t been mentioned much in the wake of the PointsBet deal. But some analysts previously addressed the topic of Fanatics\u2019 sports wagering entry potentially ushering in a renewed era of elevated promotional spending.<\/p>\n

\n

If such a scenario materializes, it could be particularly burdensome for DraftKings<\/a> because that operator aims to break even by the end of this year with an eye toward profitability in 2024. A major contributor to the increasingly ebullient profit forecasts across the sports betting industry has been operators slashing promotional spending.<\/p>\n<\/div>\n

Bottom line: Fanatics is a potential problem for FanDuel and DraftKings. The extent isn\u2019t yet known but will play out in real-time.<\/p>\n

\u201c(DraftKings and FanDuel) are now faced with at least two stalking second movers in Fanatics and bet365\u2014both of which have deep pockets, a good product (a proven one in the case of bet365), and a long-term commitment to the market,\u201d concluded EKG. \u201cThey are also ramping up at a time when the U.S. OSB market\u2014characterized by homogeneous products and a softening competitive landscape\u2014is ripe for disruption.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"

Fanatics announced Sunday that it\u2019s paying $150 million in cash for PointsBet\u2019s (OTC: PBTHF) US operations in a deal that provides the buyer with access to more than a dozen states. That means Fanatics doesn\u2019t have to wait for often slow-moving regulators to approve new license applications. With time often being of the essence in […]<\/p>\n","protected":false},"author":46,"featured_media":253587,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[10,19,1,1074],"tags":[81903,81931,81967,80968],"acf":[],"yoast_head":"\nFanatics Represents Budding Problem For DraftKings, FanDuel<\/title>\n<meta name=\"description\" content=\"DraftKings, FanDuel could have Fanatics problem, says research firm.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.casino.org\/news\/fanatics-represents-budding-problem-for-draftkings-fanduel\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Fanatics Represents Budding Problem For DraftKings, FanDuel\" \/>\n<meta property=\"og:description\" content=\"DraftKings, FanDuel could have Fanatics problem, says research firm.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.casino.org\/news\/fanatics-represents-budding-problem-for-draftkings-fanduel\/\" \/>\n<meta property=\"og:site_name\" content=\"Casino.org\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/Casino.OrgNews\" \/>\n<meta property=\"article:published_time\" content=\"2023-05-17T21:24:23+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2023-05-25T11:04:52+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/www.casino.org\/news\/wp-content\/uploads\/2023\/01\/Fl-kKJsXkAM7alE.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"1200\" \/>\n\t<meta property=\"og:image:height\" content=\"800\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"Todd Shriber\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:creator\" content=\"@etfgodfather\" \/>\n<meta name=\"twitter:site\" content=\"@Casino_Org\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Todd Shriber\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"4 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"WebPage\",\"@id\":\"https:\/\/www.casino.org\/news\/fanatics-represents-budding-problem-for-draftkings-fanduel\/\",\"url\":\"https:\/\/www.casino.org\/news\/fanatics-represents-budding-problem-for-draftkings-fanduel\/\",\"name\":\"Fanatics Represents Budding Problem For DraftKings, FanDuel\",\"isPartOf\":{\"@id\":\"https:\/\/www.casino.org\/news\/#website\"},\"primaryImageOfPage\":{\"@id\":\"https:\/\/www.casino.org\/news\/fanatics-represents-budding-problem-for-draftkings-fanduel\/#primaryimage\"},\"image\":{\"@id\":\"https:\/\/www.casino.org\/news\/fanatics-represents-budding-problem-for-draftkings-fanduel\/#primaryimage\"},\"thumbnailUrl\":\"https:\/\/www.casino.org\/news\/wp-content\/uploads\/2023\/01\/Fl-kKJsXkAM7alE.jpg\",\"datePublished\":\"2023-05-17T21:24:23+00:00\",\"dateModified\":\"2023-05-25T11:04:52+00:00\",\"author\":{\"@id\":\"https:\/\/www.casino.org\/news\/#\/schema\/person\/f4cecf70a5032bc4e60eb73fc86d4a85\"},\"description\":\"DraftKings, FanDuel could have Fanatics problem, says research firm.\",\"breadcrumb\":{\"@id\":\"https:\/\/www.casino.org\/news\/fanatics-represents-budding-problem-for-draftkings-fanduel\/#breadcrumb\"},\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"ReadAction\",\"target\":[\"https:\/\/www.casino.org\/news\/fanatics-represents-budding-problem-for-draftkings-fanduel\/\"]}]},{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\/\/www.casino.org\/news\/fanatics-represents-budding-problem-for-draftkings-fanduel\/#primaryimage\",\"url\":\"https:\/\/www.casino.org\/news\/wp-content\/uploads\/2023\/01\/Fl-kKJsXkAM7alE.jpg\",\"contentUrl\":\"https:\/\/www.casino.org\/news\/wp-content\/uploads\/2023\/01\/Fl-kKJsXkAM7alE.jpg\",\"width\":1200,\"height\":800,\"caption\":\"The Fanatics Sportsbook inside FedEx Field. 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