3 Predictions for the Sports Betting Industry in 2022
By Soo Kim, Chairman of the Board of Directors for Bally’s Corporation and CIO of Standard General
The sports betting industry faces great expectations, with investors betting big on growth in the U.S. market in the next few years: Grand View Research estimates the global market size will reach over $140 billion by 2028.
Expectations were especially high in 2021 while we saw several new entrants join an already growing share of new business. It’s exciting to see the industry getting more interactive, more in-play, more luck-based, and catering more to the masses than the die-hards and pros – and we’re still just scratching the surface of this market’s full potential.
With 2022 on the horizon, here are some of the biggest trends to watch in the sports betting industry:
Widespread legalization means big growth
There is a massive wave of sports betting momentum building on the state level. This will be the most important trend to watch in 2022, and it’s a very positive sign for this industry.
Whether by referendum or state of action, more and more state governments are approving the rollout of sports betting in their state. It’s promising to see newcomer states such as Florida and California increasing sports betting activity after legalizing. New York, the fourth-largest U.S. state, plans to go live early in 2022. Sports betting is legal in over 30 states now, with more than 10 additional states making plans to legalize soon.
This movement on the state level sets the stage for industrywide growth in the next year. I expect we will see the fastest expansion of sports betting in U.S. history culminate in 2022 – this spells opportunity for a whole new host of businesses and partnerships within the sports and gaming ecosystem.
Sports gamification is finally here
As sports betting becomes widely legalized, sports networks, commentators, athletes and fans have started to realize the opportunity for new, deeper activity and engagement. Those in the industry have for years foreseen the gamification of sports, but 2022 is finally the right time for sports, media and mobile gaming to converge.
Hampered by falling viewership, particularly among Gen Z, the live sports industry needs a strong hit of innovative thinking. Sports brands and athletes are still extremely desirable businesses – fans are just looking for a new way to experience authentic connection with and active participation in their favorite franchises. Sports betting opens up this door, offering so many micro-opportunities within a game for fans to join and play.
The advancement of new streaming bundles and non-traditional networks during the pandemic has paved the way for a sports betting-friendly media environment. If media companies and sports franchises can work out the existing tricky details around streaming rights and real-time interaction – and I think this year they will make strides – the gamification of sports is an inevitable piece in the future of sports media.
Keep an eye on consolidation
While growth and new ways to play fuel positivity in the sports betting sector, smart investors (and gamblers too) know where to exercise caution.
Watch out for future consolidation as the sports betting market grows and matures – operators will begin to merge to ensure the space doesn’t become too overcrowded.
Another factor is the role international players will serve as the U.S. sports betting market grows. Regulatorily and competitively, the European market is about a decade ahead of its U.S. counterpart. With this much headway, international players inevitably will try to be part of the booming U.S. market. This could catch American operators by surprise as international operators either try to buy their way in or build a new presence from the ground up.
It’s too early to tell what exactly will happen or how mergers and consolidation will affect the rest of the ecosystem but expect to see some consolidation balance out explosive growth.
Soo Kim is Chairman of the Board of Directors for Bally’s Corporation and CIO of Standard General, a New York-based investment firm that manages event-driven opportunity funds.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.