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The Data Revolution

| By iGB Editorial Team
FSBTech CEO Dave McDowell on how live betting has made the all-in-one sportsbook service more essential than ever.

In-play betting has irreversibly changed the face of the sports betting industry, and in a few short years has emerged as the primary driver of revenue growth for most major sportsbook operators.

But in-play’s impact upon sports betting also extends beyond the bottom line. It has transformed the way we interact with data, and in turn impacted upon almost every element of a sportsbook, from trading, to marketing, to CRM.

This stratospheric growth of live betting has been fed by our unprecedented access to data direct from the sporting venue, which has continued to become faster, more detailed, more accurate, more reliable, and more legitimate.

But it has also become more expensive as sports authorities begin to license their data rights to the betting industry. As a result, it is critical we extract maximum value from the data available.

This access to live data has fundamentally changed the operations and technology behind a modern sports betting service, and created a host of opportunities for those willing to embrace the data revolution.

Primarily, we’ve seen a move from a labour-intensive industry to one that has become highly computerised in order to handle the sheer volume of in-play product that has quickly become the minimum expectation for customers.

Whereas in the past sports betting was limited only to those large operators willing to hire several hundred traders to manually compile the odds, today we are lucky enough to have a competitive market for the supply of raw data feeds, odds suggestions, and competitive market price information.

Now, with modern technology a sports betting operator can now run a competitive offering with a dozen or fewer traders, in much the same way smaller teams can operate casino or bingo products. This frees the traders up to make decisions on margin and promotions, as well as focus on risk management and customer profiling.

But just because you can purchase the software, feeds, and only need a small team of traders, it doesn’t mean that every casino operator, media company or super affiliate actually wants to run a sportsbook.

This is why the all-in-one, fully managed sports betting service has proven so successful as live betting becomes the core of any sportsbook, and this is fast emerging as the new business model for sports betting. As a supplier of turnkey betting services, we at FSB are providing our services to retail bookmakers who need to move online, to casino operators who want to use sports to acquire and cross sell customers, and to top-tier operators who want to move into a new territory.

There is no doubt that without a comprehensive collection of live sports betting markets, none of these operators would entertain a fully managed, all-in-one solution. But there is also no doubt that they are doing it because it is a standalone source of profit.

We have found that licensees which opt for the all-in-one solution tend to become profitable very quickly, in some instances from the outset.

This is possible because the technology created to deal with the explosion in live betting now makes it possible to drastically reduce fixed fees and other barriers to entry by bringing sportsbook in line with other verticals
and charging a variable rate on profits. Accordingly, we are beginning to see operators apply to sportsbook the same logic which has proved so successful in gaming. Most gaming operators are experts at marketing and retention and leave the product to be developed by the suppliers.

You don’t see William Hill or Bet365 producing their own slots content, they ask Playtech or Microgaming to take on that burden. But some in this industry still seem to expect technology and product evolution to come from the sports betting operators themselves.

On the other side of the coin, a fully managed, affordable and competitive solution holds plenty of appeal to gaming operators who have previously been unable to enter the sports betting market. With casino CPAs skyrocketing and point-of-consumption tax eating away at the bottom line, an inexpensive, all-in-one sportsbook doesn’t just help the bottom line but can also reduce acquisition costs and improve retention, especially as the cross-sell becomes a more precise art.

Now that anyone can afford a sports betting service, our next focus at FSB is to deliver the same efficiency advantage that we brought to sports betting to the marketing tools used to acquire and retain customers.

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