Posted on: January 4, 2024, 02:38h.
Last updated on: January 4, 2024, 02:48h.
Internet casinos are widely viewed as the next growth frontier for the gaming industry, and one with stronger long-term prospects than online sports betting, indicating that there could be room for newer entrants to gain market share in the space.
In a new report, Eilers & Krejeck Gaming (EKG) highlights the recent entries of Fanatics and Jackpocket into select iGaming markets, assessing the chances of those new entrants to become credible competitive threats to the likes of BetMGM, DraftKings, and FanDuel.
The Jackpocket Casino app is closer to minimum viable than the finished article (e.g., we note the absence of cross-sell paths between Jackpocket’s lottery and casino apps, though depositing casino players can earn a $10 lottery credit),” according to EKG.
Jackpocket, which has roots in the online lottery space, recently launched its internet casino offering in New Jersey while Fanatics launched its iGaming platform in West Virginia.
Fanatics, Jackpocket Could Be iGaming Contenders
With iGaming currently legal in just six states, there’s room for long-term growth in the industry, and 2024 could bring positive headlines on the legislative front as more states look for new sources of tax revenue.
A broader playing field could be to the benefit of upstarts such as Fanatics and Jackpocket. EKG noted both operators, which cater to casual bettors, have the opportunity to add incremental iGaming market share over the long term, but the quality of their mobile applications will be essential to their success. That’s true of all competitors in the space.
“The US market, from an app quality perspective, remains homogeneous and largely uncontested. In 2024, we expect market leaders to strengthen their product advantages, but there is still room for smaller brands to make noise in the market, in our view,” added the research firm.
Buttoning down superior technology is essential to operators’ efforts to fully capitalize on the internet casino opportunity set. Analysts and operators are enthusiastic about the outlook for internet casinos because there’s a long runway for state-level legalization. It’s also a higher margin business than sports betting, and bettors are often stickier and spend more money than they do on sports wagering.
Penn Dealing with iGaming Issues
While Penn Entertainment’s recently debuted ESPN Bet sports wagering mobile app is off to an impressive start, the same cannot be said of the operator’s new Hollywood Casino offering. That brand was restarted in conjunction with ESPN Bet.
Although early OSB results for ESPN Bet have been splashy, the same cannot be said of Hollywood, for which GGR performance during a partial November appeared to be in line with Barstool historicals. At this early stage, however, we caution against reading much, if anything, into that delta,” observed EKG.
The research firm also noted that Hollywood Casino is running on the same tech stack as its predecessor, Barstool, whose platform usually scored well in previous evaluations.