Scott Butera, President of Fubo Gaming, speaks to SBC Americas about the relationship between live streaming/sports broadcasting and sports betting and if the omnichannel approach is the right way to achieve success in the industry.
SBC: How important are events such as SBC Summit North America for idea sharing and networking as the industry expands in the US?
Scott Butera: I think they’re really important, particularly in an industry like ours which is so young. Sports betting has only been legal in the US for a couple of years now. You have a lot of new players, you have a constant evolution of the business.
Originally it was fantasy players and then European players, and now we have media players. There are all kinds of different technology plays so just given how young the business is and how fluid it is right now, I think events where you can all congregate and meet with your colleagues and see what’s happening in the business, it gives younger companies a chance to present what they are doing and find potential partners. It gets folks like us up to speed on what our competition is doing. From a company side, you can discuss strategy to a certain extent, but you do get a feel towards how different players are approaching the market, and that’s important as you try to develop your plans. I think, particularly given where we are in this business, they’re quite important.
SBC: Do you foresee live streaming and sports broadcasting playing a prominent role in the US betting ecosystem?
Butera: Yeah, for sure. That’s critical to our strategy. If you look at the dynamic of what’s going on and how people are viewing sports, there is a decline in traditional television. Something like 54 million households are expected to cut the cord by 2025. We know that people like to watch sports if they bet on sports, so if the trend is to watch sports through streaming companies then streaming is going to be very important for people who are wagering.
Also, what streaming does is it gives you a chance to personalize people’s experiences. I always use the analogy that insurance companies now use where you only pay for what you need. In streaming, you can craft viewing packages that cater to what you like to watch and what you like to bet on, and I think that’s important.
We looked at our strategy and the one thing that is different about us is that our media company, fuboTV, was willing to go through the gaming licensing process, we have the first truly owned and operated integrated platform where what we are doing on the wagering side is synchronized with what we are doing on TV.
For example, you are watching a game on fuboTV, and then you pull up the Fubo Sportsbook app, it will be synchronized to that event and we can create betting opportunities and offers that follow along with what you’re watching. If you were to change the channel, the sportsbook would change to that match.
I think the flexibility that streaming gives you, both in terms of being able to watch what you want to watch and being able to create truly unique betting experiences that are synchronized with what you are watching on TV in a very efficient way, will make streaming quite important.
SBC: Will operators who successfully leverage this omnichannel approach to betting fare better than those who don’t?
Butera: There are different ways to achieve success, so in terms of better, there may be other strategies for having a great online sports wagering business. But for us, we think that bundling wagering and other ways of monetizing viewership through either free-to-play or looking down the road, peer-to-peer, will be very important social gaming.
I always use the analogy, if you think about a casino, they call it a casino, but you really have a hotel business, a gaming business, restaurants and retail businesses. On their own, all these businesses are operationally difficult, low-margin businesses. But, when you put them together, they work really well, feed off each other and they create a flywheel, which is why you can comp rooms at a casino, or cheapen tickets to events – because there are other ways to make money.
I always thought that sports wagering, which in itself is kind of a low-margin business but drives a lot of other businesses, really belongs as part of a global sports entertainment ecosystem. You have sportsbooks and casinos, they don’t make a lot of money but they drive the wagering business, they drive the food and beverage business around the Super Bowl and March Madness, and they drive a lot of engagement.
What we’re noticing is that when people watch sports now, they don’t just want to be passive watchers, they want to be active participants, they want this kind of interactive TV experience, just like at a live event. When you go to a live sporting event, but you don’t just want to sit in your chair and watch the match, you want to get food and beverages, you want to talk to your friends, you want to gamble on the event, you want to get on leaderboards, and we think its the same thing on the digital side when you watch an event on TV. You want to be part of the action and we are creating an experience where you can have that.
That’s why I think it creates a powerful platform. It creates a platform where you can add all kinds of other elements to it that creates a really exciting experience for viewers and it becomes a lot more profitable that way.
SBC: Can you give us a hint at what Fubo has planned for 2022 – are there more state markets on the horizon for the company?
Butera: We have a fairly robust pipeline. We have market access in five states so far and we’re live in two, Iowa and Arizona, and in the coming months, we hope to go live in more. Our goal is to have a national presence, so you’ll see a fair amount of work on our state rollout plan.
We’re going to be focusing on our product as well. We have this unique product where we have this synchronized betting and wagering experience and I think, by developing features that are focused on that strategy, where we have betting products that get people to watch TV, we can boost subscription revenue, and increase subscriber retention. If we get people to watch more TV because they’re wagering and we have really engaging wagering experiences then we can sell more ads. Our average viewer watches over 121 hours of television a month, which is great because we can really learn a lot about that customer.
In the casino business, you spend a lot of time knowing your customer. If you just have a sportsbook, you might know what their sports habits are, but if you have a full TV experience you know what people have watched over the past month. You know a lot about those people and you can reach them in different ways and create really personalized and immersive experiences for people.
We’ll also be developing partnerships. We’ve announced some key partnerships with teams and leagues like the New York Jets, Cleveland Cavaliers, NASCAR, the MLB, the NBA. We’ll continue to look for partnerships that enhance our business.
One thing that is also very important to us is getting people who are in our streaming ecosystem to convert to wagering. If you look at the cost of acquisition for sportsbooks right now it’s fairly high, so one of our biggest themes is if we have what is now over one million subscribers, which should be growing by over half a million in the upcoming year, then we have a fairly, robust, in-house pool to draw from where we can be converting people to sports wagering more efficiently from a cost standpoint.
Also, as I said earlier, if we can use our wagering platform to get more subscribers and get better retention, better hours, and better ad dollars, then that’s also important. So there are more ways than just wagering for us to make money on the business, which again, having this global ecosystem for sports is where the industry is heading.
SBC: The NFL/football is widely touted as the most popular sport for betting in the US, but are there any others that are emerging or are currently under the radar?
Butera: Clearly football is important, both professional football and college football. It’s clearly the biggest but it’s also the most known, and it’s not to say there isn’t significant betting on the other biggest sports like baseball, basketball, hockey, tennis, and boxing. But I think beyond that there are some unique sports where, because of the streaming platform, we can introduce them a little bit more robustly to the market and create wagering experiences around that.
We’ve just announced that we’re going to be streaming the Professional Fighters League Challengers Series and that’s something which we can create unique experiences around. I think the ability to, through streaming, feature some other sports and create fun, interactive experiences around them will bring other sports to becoming a little bit more prominent. At the end of the day, professional football and college football will always be the biggest but I do think it opens the door for others to grow a little bit more quickly than they otherwise would have.
