Hot copy: Stories that caught our eye this week from around the sector

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The Affiliate Football League

The Guardian has urged football clubs in the Premier League to reveal whether they have affiliate deals with bookmakers, after discovering that some of the clubs in the English Football League (EFL) had acted as affiliate partners for Flutter Entertainment-owned SkyBet.

The EFL said that some clubs are expected to continue to receive revenue from those deals, and by default losing gamblers, until the end of the 2023-24 season – although the arrangement lasted for a total of six years before being scrapped at the start of the 2019-20 season.

The story certainly struck a chord with British commentators and politicians, many of whom have campaigned aggressively for gambling reform.

Labour MP Carolyn Harris, who co-chairs a cross-party parliamentary group on gambling-related harm, said: “This appears to be proof that football clubs are exploiting their own fans, some of whom will be gambling addicts, by taking a cut of every penny they lose to greedy bookmakers. The government must now step in to loosen the hold that the gambling industry has on the national game.”

The Guardian said it understands that one League Two club made £5,000 from the contract in a year, while the team involved in the deal whose details were first discovered by the paper – Accrington Stanley – “made no revenue from acting as a betting affiliate during the fourth quarter of the 2021-22 financial year.”

There are concerns, however, that if the more popular clubs in the Premier League have similar deals, there could be a great deal more money than that changing hands between bookies and pro teams.

Evidence of affiliate deals in football was “a gamechanger in the fight to end gambling sponsorship in football,” said James Grimes, who campaigns for an end to gambling sponsorship in football via his group The Big Step. 

“No one should accept that this is normal or safe,” he concluded.

Retention time for bookies in the US

The Washington Post took a deep dive into US gambling advertising spend this week, examining the “considered gamble” taken by operators which have so far invested “astronomical” sums on marketing their wares to the American public.

Perhaps unsurprisingly, household names in the US like Caesars and BetMGM were singled out for their unusual stunts, including Caesars transforming a fleet of Ubers in Arizona to look like chariots, and BetMGM claiming to have “received the first bet from space.”

It pointed out that in spite of the firms’ commitment to spending whatever it takes to acquire customers in the US, Flutter-owned FanDuel is the only publicly traded US operator to have turned to profit in the market so far.

With market share of around 47%, FanDuel eclipses its competition in the US, while DraftKings and BetMGM take up a further 35% of the market between them, the Post said.

As a result, the other 60 or so US operators hoping to carve out their slice of the remaining market are now increasingly under pressure to become more cost-conscious.

Punters in the US are therefore likely to see “skimpier” promotions and fewer sportsbooks advertising on national TV this autumn, it added.

“You’ve seen the industry pull back and say, ‘Wow, fighting for market share got pretty ugly in terms of losses’,” said David VanEgmond, a former executive at FanDuel and Barstool Sportsbook who now leads investment group Bettor Capital.

Still, the investments could yet pay off for US bookies who were brave with their advertising spend in the first few years of the market opening up.

According to McKinsey partner Dan Singer: “When a market opens up, you’ve got to get out there and start acquiring, because being the first book that someone downloads gives you roughly twice as much action as being the second or the third.”

And, with the average customer expected to be worth thousands of dollars to a bookie over their lifetime, those operators will now look to retain the customers they’ve already got hold of.

Rather that, VanEgmond suggested, than going the same way as Caesars, who had “a bunch of people come in, then losing them to other places and now having nothing really to show for it.”

The ‘Netflix of Gaming’

Netflix is setting up its own video game development studio in Helsinki, according to a report released this week by BBC News.

According to the piece, the streaming giant has long had an interest in the gaming world – having acquired small developers including Oxenfree creator Night School Studio – and now wants to increase its capabilities in the sector by establishing its own Helsinki-based development studio.

The studio will be run by former Zynga and Electronic Arts executive Marko Lastikka, who is an established figure in gaming as one of Farmville developer Zynga’s co-founders.

Apparently, Lastikka will help Netflix attempt to improve its retention rate by offering a more engaging product to customers, after the service announced its first quarterly reduction in subscriber count in April this year.

The firm went on to lose another million subs between April in July, the biggest drop in its history. It still has more than 220 million subscribers worldwide, however.

According to the article, Netflix is also working to identify areas where TV, film and video gaming cross over. The firm has already released several series based on games, including Arcane based on League of Legends and Cyberpunk: Edgerunners.

Netflix is also working closely with Ubisoft, the BBC said, which will see both a live-action Assassin’s Creed television series developed, and a Netflix-exclusive mobile game.

Independent industry analyst Eric Seufert told the BBC that he thought Netflix was making substantial investments into gaming.

“If they want to utilise a lot of the IP that they have, they probably have to build a lot of those games themselves,” he said. “Because working with external publishers on IP licensing deals becomes very tedious and complex.

“They have so much data on customer preferences on the video-streaming content side, my sense is they can probably bring some of that to bear.”

So it looks like anyone promising to create “the Netflix of gaming” has some bad news awaiting them… they’ve already beaten you to it.

About the author

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Conor Mulheir

Conor entered the gaming industry in 2018 producing high-level live event content for audiences in London, Amsterdam and São Paulo. From 2020, he went on to report news and commission exclusive content for various gaming media brands before joining iGaming NEXT as editor in January 2022.

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