Micro-Gaming? Is it a game changer of the US sports industry?

Is micro-gaming the future of the US sports industry? Reports argue that in the next few years micro-betting could become a large contributor to potential investment in additional advertising, sponsorship and in-game e-commerce revenue.

Ever since the Professional and Amateur Sports Protection Act (Paspa) was overturned back in 2018, the growth of sports betting has been at the epicenter of discussion. As the most recent US elections have shown, about half the states in the US will see some form of legalized betting permitted by 2021-2022.

Presently, there are mixed emotions shared between data providers, broadcasters , sports properties and operators as everyone is fighting to get a lice of the pie however, the question lies in what the revenue drivers will be.

Major US sports leagues such as the National Basketball Association (NBA) and the National Hockey League (NHL) among others have already partnered up with various parties within the gaming sphere such as data drivers and operators. Such agreements initially had a prime focus on marketing and promotion however, deals are nowadays more inclined towards innovative factors such as naming rights and equity stakes.

The American Gaming Association as published that generic betting revenues have passed the $20 billion (Q3) mark whilst sports wagering generated $700 million. Point spreads and over/under are the most common form of sports betting, but until bettors can bet on every play in a game while the game is live, revenues will only grow modestly year-over-year.

This form of volume betting known as micro betting or micro wagering used to be refereed to as prop betting. For example, a pundit would bet whether a soccer team would score a goal during their next attack on goal. In order to achieve such a volume of micro bets, operators are required to produce innovative technology that can be fast enough to process real time and historical data that is capable to provide changes in odds.

It is estimated that once real-time technology is adopted across sports leagues and operators, revenue and engagement will grow significantly. It is forecasted that by 2023 billions will be generated simply because of the volume of bets placed during each game. This notion leads to the belief that micro-betting will also be a large contributor to potential investment in additional advertising, sponsorship and in-game e-commerce revenue.

However, it can be said that creative deals that include naming rights, equity positions and integration into each other’s business will become the norm and drive the billions everyone is hoping to see. Although there will always be an offshore market for some, as more States pass legislation more money will flow into the legal markets which is good for everyone.

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