The sports world and sports betting industry are among the many feeling the dramatic effects of the global coronavirus pandemic. While the situation remains dynamic, we turned to an expert in the industry for some early projections on what potentially lies ahead for sportsbook and casino businesses.
Yaniv Sherman is a gambling and sports betting expert and head of commercial development at 888 Holdings, one of the world’s leading online gambling companies in the world. He talked to PlayPennsylvania on March 12, just after the NBA and NHL postponed seasons and the NCAA ended theirs.
888’s online casino is not yet live in Pennsylvania, but it is available in New Jersey. Pennsylvania’s sports betting figures for February were released on March 16. The Commonwealth took nearly $330 million in bets during the month, and it surpassed the $2 billion mark for total handle.
Sherman shares early projections on coronavirus impacts
The following is a Q&A with Sherman in the wake of the immediate impact of coronavirus.
The impact of coronavirus just hit the sportsbooks. How do you expect it to impact the sports betting industry as a whole?
Sherman: It’s the first time this has ever happened in our lifetime in the sports betting world. There were strikes in the past in major sports, but we’ve never seen something that has shut down major sports completely. March Madness and the NBA was something that sportsbooks look forward to. Now, sportsbooks are going to have much less, if anything, to offer.
There are two things to keep in mind: The breadth of the effect and not knowing how long it will last. It’s an unprecedented situation, and we are at the peak of uncertainty. I hope we will have further clarity as time goes by.
For betting companies like 888, we offer a full suite of products, so we’ll see how we can divert the focus and offer different products. Pennsylvania is also a market where online gaming is available but in a more vulnerable situation because it’s just getting off the ground. This season was the time operators were trying to build their constituency and crossing them over to other products. It will be interesting to see how operators react.
Do you think people will pivot from sportsbooks to online casinos during this time?
Sherman: In the near term, online casinos may see an uptick. But everyone should brace themselves because we’ve never seen anything like this.
The most important trait an organization should have is agility, which is the right people and resources to react to what is going on. It’s important to keep the organization nimble and reactive.
Brick-and-mortar casinos are closing to help curb the spread of coronavirus. Do you think people will go online to play and bet?
Sherman: It would be the logical assumption, but these things aren’t as simple as you would expect. As the level of uncertainty and anxiety rises, people are less emotionally available to have entertainment experiences.
We’ve been pushing the digital agenda because online sports betting, especially where it is available in places like PA, is taking 85-90 percent of the pie. It’s clear that sports betting in the United States should be mobile- and internet-oriented.
Casino operators believe the experience 10-15 years down the line will be more digital, but something like this may accelerate the trend.
What will it take for sportsbooks to survive the coronavirus?
Sherman: It’s a great question. It’s very dependent on how long this will take. I can think of a few operators in the US that solely run a sportsbook. I think they are very sensitive to this situation.
It’s dependent on how diversified you are from a geographical perspective, not just from a product perspective. At 888, we offer a full suite of games across dozens of jurisdictions, so we are more diversified.
This is a global crisis. In the end, if you are only focused on one product and one market, you are in a pickle. You either need to pivot your company or face a difficult situation if this is prolonged.
Just to take a doomsday scenario, if this is prolonged into the NFL season, I see several operators being in a terminal state.