This article originally appeared in the December 2024 edition of GGB Magazine.
In 2024, there was a unique development in the sports betting industry, as no new state legislatures legalized sports wagering, a first since 2018 when sports betting became a state-regulated issue. Contrarily, Missouri voters did give their approval for sports betting in November. Meanwhile, North Carolina and Vermont introduced live betting, marking the fewest state launches since 2018. However, the trend of platforms reducing their presence or disappearing altogether continues unabated.
Companies like Betr, Sporttrade, and Underdog Sports have managed to thrive in this challenging environment. Instead of rushing to get licenses and enter every market, these firms have chosen their markets carefully, aiming only at those where they can succeed. Their growth has been steady rather than explosive.
Even some well-established national names, including Churchill Downs and Wynn Resorts, have launched and subsequently halted operations. After the repeal of the Professional and Amateur Sports Protection Act in 2018, numerous companies, even those outside the core sports betting arena, seized the opportunity to dive in. Companies like FuBo TV and Maxim, known for its flagship magazine, launched a few online betting platforms, which were short-lived, folding within two years.
Since the year 2020, over 20 companies have shut down at least parts of their digital sportsbooks in the U.S., often stating a need to “concentrate on the core business.”
### Five Firms Reduced U.S. Presence in 2024
The trend of shrinking operations persisted into 2024. Five sports betting platforms, active in several states, either announced steps back or finalized their U.S. withdraws. Betway, SI Sportsbook, and Unibet decided to entirely exit the digital betting arena, while SuperBook and WynnBet retracted from multiple states but maintained operations online in Nevada.
Consultant Brendan Bussmann from BGlobal noted, “The competitive landscape is intense, and everyone is trying to endure this long race. It’s particularly challenging for smaller players competing against larger, more resourceful competitors.” This outlook seems validated, as WynnBet vacated eight U.S. markets in August 2023, completing its exit outside of Nevada with Massachusetts earlier this year. The firm cited costly customer acquisition as a main reason for their retreat.
### SuperBook’s Resized Strategy
SuperBook’s strategy of quick expansion was, in part, built on offering its NFL SuperContests in new states, a plan hindered by regulatory challenges. In July, following four years of growth, the company admitted it couldn’t gain market footing and pivoted back to emphasizing its Las Vegas hubs by shutting down eight platforms.
Betway, part of Super Group, similarly declared in July that it was reducing its U.S. presence, unable to foresee a viable path to profitability from its operations in nine states.
Recent exits include SI Sportsbook’s ongoing withdrawal and Unibet’s pullout announced in late 2023. Unibet stated its inability to contend with the U.S. market leaders as the principal reason, completing its exit by 2024.
With fewer players in the market, consumers are left with dwindling options. This reduction could also stifle innovation, as fewer companies vie for customer attention.
“There will always be new ideas coming from other quarters,” Bussmann mentioned, “but the greatest benefit to consumers is consistency in competition, be it among three participants or twelve. Competition fosters innovation.”
### Incremental Growth Vital for Smaller Players
Amidst these withdrawals, Betr, supported by MMA star Jake Paul, continues to expand gradually. The microbetting platform is active in two states and intends to expand, despite an early 2024 exit from Massachusetts.
Sporttrade, which provides stock-market-style trading in certain regions, currently operates in five states. Meanwhile, Underdog Sports, known for its large fantasy sports operations, participated in North Carolina’s online sports betting launch in March. It holds a license in Ohio and is poised to enter more legal states. Each of these companies takes a prudent approach to avoid joining the list of defunct platforms.
Bussmann concluded, “The companies that persist have wisely identified and stuck to their core markets. By choosing not to scatter efforts in every new market, they sustain their presence in the industry.”