High profile US betting brand Barstool Sports is continuing to expand in the growing US sports betting market and its next target appears to be the Michigan online market.
In an interview with an industry publication, Jay Snowden, the CEO at Penn National, which owns a 36% stake in Barstool, revealed that Michigan will be the brand’s second active market, but this time the launch will be different from that seen in Pennsylvania. With that market, Barstool entered a sector that was already mature, having been running for a year, but in Michigan, the sportsbook platform will be there from the beginning.
Sports betting in the state of Michigan has had a rough ride, having launched back in March, right at the start of the COVID-19 pandemic. But the sector has battled on and will reach a new milestone when online sports betting debuts in the second half of November. Online casino betting will also go live at some point in the next few weeks pending further approvals.
According to Snowden, Barstool plans to be live in as many as 12 states by the close of next year, but surprisingly, there are no big plans for the remainder of 2020. This is despite the fact that Penn National is planning to launch casino operations in Illinois, Colorado, Indiana, West Virginia, New Jersey, and Virginia before the end of the year.
In all but one of those states, sports betting is already up and running, potentially giving Penn a chance to cash in on the bonanza associated with the NFL season, which reaches its peak at the end of the year and through January 2021. Reports suggest, however, that Penn is focusing more on the traditional March Madness series of college basketball games as the launching point for its betting operations in new states, giving it a little breathing space to get up and running.
Another surprising omission in the Barstool plans is the state of Tennessee. With no limit on the number of online sports betting licenses in the state, which is set to launch its sports betting market on November 1, Tennessee represents another opportunity for sportsbooks, however, the relatively high level of hold required in the state, of 10% may be deterring Barstool and others.
Snowden also outlined the potential for other earning outlets through Penn’s collaboration with Barstool and their key players, founder Dave Portnoy and CEO Erika Nardini:
“When Dave and Erika, and Dan [Katz] and everyone at Barstool gets behind something like they’re behind the Barstool Sportsbook right now, you can envision a lot of doors opening up and potentially some adjacencies that we could invest in that we’re not even in the business of today.”
If there is a cloud on the horizon for Penn, it is the potential for bars and convenience stores to offer slot machines. This model is legal in many states and could pose a threat to Penn’s casino business. Snowden says that he has significant concerns about the risk of problem gambling not being taken seriously in such establishments.
His arguments may not gain much traction with politicians, regulators, and the media, however, given Barstool’s recent social media campaigns, which have included a photo of a child asking an NBA side to cover a point spread and a show featuring a giant cup displaying the phrase, ‘You can only lose if you quit’, advertisements that seem likely to give anti-gambling lobbies plenty of ammunition.
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