DAZN doesn’t need to go “all in” on sports betting, says CEO Shay Segev
DAZN CEO Shay Segev has revealed the vast majority of his time and focus is spent on the firm’s media and subscription service – and not on sports betting subsidiary DAZN Bet.
Speaking at the SBC Summit Barcelona, former Entain CEO Segev explained that in spite of several high-profile hires from within the betting and gaming industry in recent years – including himself – DAZN’s business strategy is to focus almost entirely on its sports streaming product.
“Our objective at DAZN is to ensure that our media business is sustainable, and is a standalone business by itself that does not rely on the betting – the betting will come anyway as part of the natural growth into further revenue streams,” he said.
That doesn’t mean, however, that the business is not taking its newly launched betting arm seriously.
Asked whether the business was prepared to go “all in” on sports betting, he replied: “The question depends on what you mean by ‘all in’. Does ‘all in’ mean you want to develop a betting business whose objective is to maximise betting? Or do you want to develop a business where the idea is to maximise the relationship with the customer?
“If you’re a betting business, and all you do is betting, then you don’t have many options – you need to maximise betting. But if your business model is broader, then for us, a customer who stays 12 months and doesn’t bet, but who pays us €30 per month for a subscription to watch content, that’s a good customer. They don’t need to bet.
“We don’t necessarily want them to bet, but if they do want to, we’re giving them the option,” he explained.
Indeed, DAZN is making the bulk of its money from streaming, with the business expected to generate around $2.5bn in revenue this year, increasing to $3.5bn in 2023.
DAZN CEO Shay Segev: “Our objective at DAZN is to ensure that our media business is sustainable, and is a standalone business by itself that does not rely on the betting.”
In comparison, betting offshoot DAZN Bet is likely to be a relatively small piece of the pie for many years to come.
“We’re still experimenting,” Segev explained. “The idea is to develop it, but there’s no rush. We don’t want to make $50m, $100m, $200m in EBITDA from betting very quickly.
“Clearly if it did happen, we would be very happy, but we want to create a long-term sustainable business which generates value, and then we want to scale it globally.”
For that reason, Segev said he was spending 99% of his time on DAZN’s media business, with the betting business and its all-star roster of gaming industry veterans working in parallel.
Having launched its first beta site in the UK in August, the firm has taken its first major step in generating gambling revenue.
However, the site “is far from where it needs to be,” Segev admitted. “We don’t have an integrated experience yet – it will probably take a few more months to create some kind of an integrated journey.”
Segev remains confident though that eventually, DAZN will develop into a major player in the international betting industry.
“If you’re asking me if DAZN is going to be a big betting business, the answer is probably yes,” he said.
“But not because we want to become a big betting business. Rather, because we will become a big sports platform and betting will become an element of this – and the audience will be there.”