FuboTV, a leading sports-first live TV streaming platform is in the midst of a major move into the legal betting space as a complement to their strong media brand. In December FuboTV announced the acquisition of California-based technology start-up Balto Sports, a platform founded in 2018 that allows users to set up fantasy sports contests. Late last week, the streaming service announced the purchase of sports betting and interactive gambling firm Vigtory.
David Gandler, co-founder and CEO, FuboTV, commented, “As we said in our third quarter earnings announcement last month, FuboTV sees the online wagering space as complementary to our sports-first live TV streaming platform. We believe there are significant synergies between consumers who enjoy wagering and our subscribers who enjoy streaming live sports, creating a flywheel opportunity.”
He went on to say: “We not only expect sports wagering to become a new line of business and source of revenue, but we also expect that it will increase user engagement on FuboTV resulting in higher ad monetization, better subscriber retention, and reduced subscriber acquisition costs.”
The FuboTV Angle
FuboTV has been a major player in the sports streaming lane for quite some time. At present, they boast 455,000 subscribers and is home to “tens of thousands of live sporting events” each year. Their hope is to build that subscription base to between 500,000 and 510,000 by year’s end, and a betting angle has been identified as one way to help to achieve that goal.
The Balto acquisition fulfills the Fantasy angle for a business model that has been so successful with two of the biggest current betting providers in the industry. Now Fubo will get to fuse that expertise with a stand-alone sportsbook down the road thanks to Vigtory being a part of the company’s portfolio.
The Vigtory Angle
FuboTV’s acquisition of sports betting start-up Vigtory seems a perfect fit for what the streaming service is hoping to accomplish in 2021. FuboTV had been chasing opportunities to not only bring in new revenue forms but also maximize their loyal users’ sports viewing experience. A stand-alone sportsbook is the obvious way to do just that.
Vigtory founder Sam Rattner and co-CEO Scott Butera, who will serve as COO and President of Fubo’s gaming division, bring with them immense experience from their time at one of the sports betting giants, BetMGM. Rattner and Butera give Vigtory and now FuboTV instant credibility in the legal sports gambling space.
The Need for Deals
FuboTV was at risk of falling behind. Sinclair Broadcast Group was bought by Bally’s and other deals between media and sports betting companies – CBS/William Hill, Barstool Sports/Penn National, NBC/PointsBet, ESPN/Caesars, and VSiN/BetMGM has made it necessary for broadcasting companies to forge a path forward with the sports betting industry. In this time of exponential growth in the US legal sports betting industry, the need for deals keeps rolling along.
FuboTV is signaling that they are ready to become a player in the legal sports betting space. They have the sports platform and the subscriber base giving up $65-a-month for the premium, global sports broadcasting service – now they will try to flip them to the sports betting side.
A press release by FuboTV summed it up. “… FuboTV announced today more details of its online wagering strategy, further positioning itself to enter what Zion Market Research estimates will become a $155 billion industry by 2024. Through its December 2020 acquisition of Balto Sports and its content automation software, FuboTV intends to launch a free to play gaming experience this summer. Free to play gaming, which will be available to all consumers whether or not they are FuboTV subscribers, will first launch in a standalone app and later be integrated directly into the FuboTV user experience. By leveraging the Vigtory and Balto acquisitions, FuboTV intends to launch a sportsbook app where consumers can see current betting lines, place a variety of wagers, cash in their winnings and much more across sports they love. Finally, the company expects to integrate the sportsbook into FuboTV’s live TV streaming platform for a seamless viewing and wagering experience.”
Fubo’s share price was up 16%, at $31.42, following the news of the Vigtory acquisition and has climbed about 227% in the last year.