Industry predictions for 2021: the evolution of sports data and a rise in streamer influence

Andy Phillips, head of business development for sports and gaming within the market technology business, Nasdaq

Evolution of sports data and the pricing function

Advancements in technology for sports data capture promise to deliver exponentially more raw material for oddsmakers and quants to play with. However, wrong turns and dead ends will be inevitable while trying to develop compelling betting markets. Do $1bn+ market cap operators and suppliers still have appetite for the risk-reward profile of that R&D? We are already seeing a gradual emergence of specialists across US sports, esports, player props, fast markets and bet builders. How do these integrations get on the roadmap? In thinly traded markets, suppliers really need to see and control bet flow for proper risk management, making the integration further complicated still. Sportsbooks best able to accommodate and experiment with this new layer of innovative market makers – perhaps even letting them directly compete on price to be “top of book” – will find huge edge.

The return of an unfashionable format

Does evolution lead to revolution, opening the door for pari-mutuel and P2P to make a comeback? You can offer any one of about a million esports events a day if you don’t need to compile the odds and you are not taking risk. Esports fans are often familiar with pool betting thanks to the former popularity of skins betting. Pari-mutuel’s big drawback is that the Starting Price (SP – the odds given at the start of the event) can differ from the odds that are advertised in the lead-up to the event. Most disappointment occurs at the race-track, and if you happen to back a winner, you can often find your odds cut by the time the race starts.  But in low information-low liquidity or fast markets, we can’t know the true price and you could just as likely get an improvement. Someone needs only to find a way to package the additional excitement of discovering what price you got at market close, before the next point, play, pitch, or kill of Roshan…

Governance to up its game in key areas

We hope to see a Single Customer View finally implemented so that regulators enjoy the insight that our clients, like the UK’s FCA, have in capital markets. If executed correctly, operators should enjoy shedding many burdensome responsibilities. A holistic view of the betting market ought to provide benefits beyond responsible gaming. For instance, better tracing the connections between match-fixing and money laundering. Punishments are far harsher for the latter, and governments are incentivised to seek them out with the opportunity to confiscate proceeds. The joined-up approach would prove a more effective deterrent. A large impediment has been the scale and opacity of the black market. But prohibition is losing the battle in favour of explicit regulation. The Asian credit market now appears to be in decline and a time will come when the critical mass that sustains this business model collapses. The iron curtain will be gone and there’ll be no excuses for allowing the fixers room for manoeuvre.

Nicola Longmuir, CCO, Push Gaming

Entertainment first

With every year comes new changes, and we’ve really started to see the next generation of players getting involved in gaming. Alongside that, as with all advancement in technology, comes the need for speed and strong connectivity. 5G, for example, is really starting to test its capabilities, and I believe there’s going to be real scope for developers to get creative as 2021 progresses, with a far greater demand by the player for entertainment-first content. Delivering an experience that can really resonate with the player can’t be commodified – and specialised games with top animations and immersive visuals are going to be essential for attracting the interest of a wider player base. I also predict we’ll start to see studios move past the ‘reskin after reskin’ commodity gaming approach. Of course, some have used it as an effective business model for more than a decade, but with players being more discerning than ever, it’s going to be all about fun, edgy and innovative features that can really entertain. Both operators and suppliers who look to provide such content will harness the surge in media interest, as well as building some serious brand advocacy.

Increased streamer influence

The ways in which we consume media are continuously changing, and it’s no surprise to see that the current Covid crisis has undeniably had a big impact – and we’ve seen the usage of media increase significantly as a result. With this in mind, we need to also be aware of changes in consumption patterns. It seems very likely that we’ll see an even bigger shift towards streamers as part of the social element of gaming. Being part of this is already an essential way of reaching out directly to players, and it will no doubt be an integral part of the future of our industry’s B2C marketing. Already established as an essential acquisition and retention channel for studios and operators, we’re really beginning to see the effect particular influencers can have on driving engagement and retention, and I predict they’ll prove key next year. Responsible gambling – more crucial than ever Being big in Europe is all about being live in key markets. With that, however, comes tougher regulation. The UK, Sweden, Germany and Netherlands are all good examples of this – and we’re certainly going to see a more focused presence from each market’s regulators. Creating content that can excite, while adhering to enhanced restrictions will be a challenge that will likely prove healthy for the market in the long-term. The importance of VIP players will also continue to diminish – especially in regulated markets where max stakes are likely to be enacted. Operators are seeing a systemic shift from a large proportion of their revenues being generated by a small proportion of players, to revenues being driven by players playing for lower stakes.  The B2B supplier vertical will need to adapt its game products and marketing to reflect the changes in market. In effect, this means we’re marketing to a new generation of players with an infinite amount of content to choose from. Operators are, so far, bearing the brunt of these measures, and I expect to see a few studios really differentiate themselves in 2021 by putting players in the driving seat when it comes to customising their own responsible gaming experience.