Modification Of Gannett Deal Could Point To Tipico Exiting US Online Gambling

Written By Derek Helling on August 10, 2022
gannett us online gambling tipico

Only one letter separates the English and German words “aggressiv” and aggressive, but that descriptor hasn’t fit Tipico‘s approach to US online gambling, regardless of which language you’re speaking. A recent change in the German gambling company’s publicity contract with American newspaper conglomerate Gannett points to an explanation for that lack of vigor.

Rumors have circulated about Tipico cutting its losses in the United States. The new deal with Gannett could be more about Gannett’s interests than Tipico’s ambitions. Still, it’s a move Tipico doesn’t make if it’s “aggressiv in den Vereinigten Staaten (in the United States).”

US online gambling player Tipico alters deal with Gannett

Last week, Gannett held its second-quarter earnings call for investors, and those investors who took part probably wish they would have passed. According to Rick Edmonds of Poynter, Gannett lost $54 million during the quarter.

The owner of USA Today, around 200 other regional newspapers, and several digital publications in the US say it is preparing to lay off staff. Gannett CEO Mike Reed explained that advertising revenues failed to meet expectations during the quarter. Reed also confirmed an interesting change that involves Tipico.

Reed stated an agreement with Tipico “has been modified to allow ventures with other sports betting companies.” Just over a year ago, Gannett and Tipico formed an exclusive partnership that made Tipico the sole sports betting odds provider for Gannett’s full array of digital and print publications.

The alteration has an obvious benefit for Gannett.

Why a Tipico exclusive never made much sense for Gannett

To date, Tipico’s US operations include an NJ online casino and online sports betting in New Jersey along with operating an online sportsbook in Colorado. Thus, most of Gannett’s readers were seeing odds they couldn’t wager on even if they wanted to.

Part of the financial incentive for Gannett was converting readers to Tipico bettors. Gannett essentially got an undisclosed “referral” bonus for each customer it drove to Tipico. The value of that for Gannett, however, has been limited by Tipico’s small footprint in the industry.

This change isn’t a total divorce between the two. It simply frees Gannett up to pursue similar arrangements with Tipico’s, well, non-competitors – in states where Gannett operates but Tipico does not. With Gannett’s struggles securing advertising dollars, it’s a much-needed new avenue.

It’s unclear if Tipico made Gannett any promises about expanding into other markets during the original contract negotiations. Perhaps Gannett just saw an advertiser offering some money and then decided to cash the check to deal with the rest later. Either way, Tipico hasn’t exactly been chomping at the bit to grow its business in the United States.

Tipico’s US online gambling indifference

Tipico has agreements opening the door to online sports betting in Indiana, Iowa and Ohio. However, Tipico has seemed unbothered about actually capitalizing on its opportunities in Indiana and Iowa.

Its deals in Ohio suggest it should be more active there. Both the Columbus Crew of MLS and the Columbus Blue Jackets of the NHL have announced sports betting partnerships with Tipico. The involvement of those parties will likely spur Tipico to make Ohio its third active US market in 2023.

The question could be for how long that could be the case, however. There have been rumors of Fanatics acquiring Tipico’s US operations. The deals with the Blue Jackets, Crew, and what remains of the contract with Gannett could help Tipico negotiate a higher price with Fanatics.

An acquisition could actually be a great outcome for Tipico’s operations in the US, too. Additionally, that might have been the endgame all along. If it isn’t going to invest the resources necessary to compete on a national level, then Fanatics’ purchase might represent more money than it is currently making on its relatively meager activity.

CNBC reported that price has been the issue holding up Fanatics’ acquisition, so perhaps the altered deal with Gannett comes at a bad time for Tipico. In a nod to a famous The Empire Strikes Back line, Tipico might be praying Gannett doesn’t alter it any further.

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Derek Helling

Derek Helling is a lead writer for PlayUSA. Helling focuses on breaking news, including legislation and litigation in the gaming industry. He enjoys reading hundreds of pages of a gambling bill or lawsuit for his audience. Helling completed his journalism degree at the University of Iowa.

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