It’s not exactly obvious on the surface, but true competition is missing from the emerging US sports betting industry.
Sure, sportsbooks are operating under a variety of casino and brand names and taking legal bets in 11 states and counting. However, there’s only a handful of companies setting lines and supplying them to these operators.
European Unibet-spinoff Kambi Group, in particular, appears to be dominating the largest markets in New Jersey and Pennsylvania. Plus, one of the country’s largest gambling companies announced last week it’s going to let it dominate more as soon as it legally can. But we’ll get to that in a minute.
What this lack of competition in the oddsmaking business means for consumers can be difficult to quantify, but it isn’t hard to see.
Line shopping for odds is stifled by Kambi
The one surefire way consumers can find value while betting sports is to line shop. Line shopping is the process of going from book to book, online and off, to find the best price on a bet. If you find bigger odds on an underdog or have the ability to lay less on a favorite, then you’re putting money in your pocket.
Having only one oddsmaker setting the lines for the majority of sportsbooks in any market pretty much handcuffs the public’s ability to shop around. Enter Kambi.
Kambi is content playing the wizard behind the curtain, instead of being an Oz-like public face of sports betting in the US. You may not know that Kambi is supplying the platform and setting the lines for so many.
Plus, Kambi is even more dominant in Pennsylvania. There, it powered all three of the first PA online and mobile sports betting products to hit the market. That includes SugarHouse Sportsbook, Bet Rivers and Parx Sportsbook.
Is the fix in?
In New Jersey, consumers could still look around for the best price on their bets. However, those unaware of Kambi’s widespread involvement would inevitably run into enough of the same lines to start wondering if the fix is in.
It practically is.
Kambi lines are almost everywhere you look and spreading fast. Just this week, Penn National Gaming announced its plans to capitalize on US sports betting expansion. It involves several sports betting operators. However, the lines at the 40 Penn National Gaming properties in 19 states will all be set by Kambi.
Of course, Kambi officials are quick to point out that operators can tweak the lines it supplies as they see fit. It’s just that none of them have yet.
Lack of competition in the oddsmaking business
That’s probably a good thing for consumers in a state like PA. It was first feared high-tax rates there would force operators to post less-than competitive lines, but that hasn’t happened.
It also means some form of across-the-board equality in lines from state to state across the country, whatever that’s worth.
But overall, the lack of competition means most consumers’ ability to shop around has been severely hampered. Ultimately, that’s going to hurt the legal sports betting industry’s effort to usurp the illegal one.