NBCU and PointsBet Extend Betting Deal: Book Must Spend $58 Mil Per Year on Marketing
PointsBet has been trying to expand its U.S. presence since launching in New Jersey in 2019 and has been up against some tough foes the likes of DraftKings, FanDuel, Caesars and BetMGM. These are widely consider the "Big Four".
But there is trouble looming on the horizon in the form of ad spend. PointsBet will be required to spend roughly $58 million per year on marketing with NBCU channels. Perhaps that's a bargain. They were initially required to pay $90 million per year.
US, Canada, and NBC slides below...
— Alfonso Straffon (@astraffon) January 30, 2023
PointsBet - Q2 FY23 Quarterly Activities Reporthttps://t.co/lhTMOLphfN pic.twitter.com/EjlKBGn3dj
The total committed marketing spend over the next five years will be $294 million, per an Axios source familiar with the deal.
The marketing expansion appears to only involve NBC Universal properties Peacock, USA Network, Comcast local TV ad network effectv and CNBC.
And if you thought this was an exclusive deal, guess again.
BetMGM jumped into the fray this past September. The deal as renegotiated allows for NBCU to enter into deals with PointsBet competitors.
BetMGM owned 29.8% of the US internet casino market in 2022 with DraftKings securing the No. 2 spot at 22.8%. Any online sportsbook operator worth their salt know it's the casino portion of the business that helps boost profit margins. BetMGM is also the second largest sports betting operator in the US regulated market.
BetMGM expects to turn profitable in the second half of 2023 after the MGM Resorts and Entain joint venture's annual revenue beat its own forecasts, aided by strong gaming margins, the company revealed last week.
Britain's Entain, which owns Ladbrokes and Coral betting shops as well as bwin and partypoker online brands, said on Thursday that BetMGM's annual revenue was $1.44 billion, up from its forecast of $1.3 billion.
The betting firm is on track to achieve revenue of between $1.8 billion and $2 billion in fiscal 2023, Entain said, adding that BetMGM's joint owners were expected to invest an additional $150 million this year.
- Aaron Goldstein, Gambling911.com
