The latest episode of Right to the Source features Nigel Eccles in a revealing interview, with hosts Robin Harrison and Ed Birkin discussing FanDuel and other key trends in the gambling sector. They also reintroduce a popular topic for listeners: prediction markets are making a comeback.
Ed presents H2’s unreleased data on NFL prediction markets, which indicates a relatively stable sportsbook handle for the year, showing a slight increase of 0.4% in states where reporting is available. However, including Florida, the figure dips by 1%. This stability is attributed to a balance of about 4% organic growth offset by a similar headwind from the rise of prediction markets.
The share of prediction markets in the combined handle of regulated states has surged significantly, rising from about 5% six months ago to approximately 15%. Much of this growth can be traced to aggressive investments tied to the World Cup and continuing through August.
A key topic discussed is which state is experiencing the most significant challenges. One hint points to a state with a warmer climate.
Additionally, Robin and Ed delve into the legal complexities surrounding prediction markets. Ed shares insights from a recent trip to the U.S., noting that many anticipate the ongoing dispute between states and the Commodity Futures Trading Commission (CFTC) could potentially reach the Supreme Court around 2027-28. The situation is evolving, as highlighted by Matt Rybaltowski's report that the NFL has filed an amicus brief urging the Supreme Court to examine the case Flaherty vs KalshiEx, LLC.
The conversation shifts towards mergers and acquisitions in the industry, as Ed and Robin engage in a spirited debate about whether such deals genuinely bring value. They examine several recent transactions, including the merger between Banijay and Tipico, using Flutter as a primary example. Ed contends that there is insufficient evidence to suggest Flutter's acquisitions have generated value beyond FanDuel. Listeners will learn how Lottomatica's acquisition of Cirsa fits into this discussion during the conclusion of the episode.
