Live TV streaming platform FuboTV has shocked sports bettors by announcing its decision to close Fubo Gaming and the Fubo Sportsbook product. The move was especially surprising as it coincided with FuboTV announcing preliminary earnings results of over 1.2 million subscribers and income for the quarter that exceeded its prior guidance.
When launching Fubo Sportsbook last year, FuboTV said that the new product was much more than a wagering profile and was “purpose-built to meet U.S. sports fans’ growing demand for interactivity through an industry-first integration of an owned-and-operated sports wagering platform with a live TV streaming experience.”
The company added that “by integrating with FuboTV, the mobile app delivers a personalized omniscreen experience that turns passive viewers into active and engaged participants. Fubo Sportsbook is launching with a unique feature, Watching Now, which leverages FuboTV’s first-party user data to allow users to instantly view wagering content based upon what they are streaming — even as they change the channel. Fubo Gaming intends to continue iterating the app, launching additional features, subject to regulatory approval, that will further integrate wagering into the FuboTV platform, to create an even more immersive and personalized experience.”
Why has FuboTV scrapped Fubo Sportsbook?
FuboTV’s decision to scrap Fubo Sportsbook is incredibly confusing. This is especially the case considering FuboTV launched free-to-play Pick’em Games that integrated with its live sports streams as recently as June 2022. At the time, the company promised that the new feature “demonstrates and further builds upon the seamless Watch/Wager/Win connection between FuboTV and Fubo Sportsbook — all within a single ecosystem.” It also recommitted to launching live odds this year.
However, now the business is gone entirely. When announcing the move, co-founder and CEO David Gandler simply said “following our previously announced strategic review, we have concluded that continuing with Fubo Gaming and Fubo Sportsbook in this challenging macroeconomic environment would impact our ability to reach our longer term profitability goals.”
Rumours persist that the company was unable to find a partner who was willing to help shoulder the expense of launching gambling features widely. Similarly, a new production deal between FuboTV and the Ryan Reynolds-backed production company Maximum Effort that included Maximum Effort buying an ownership stake in the streamer may have caused further complications.
Stuart Foster, co-CEO of new betting network Bonus Bet commented; “This is an innovative space with lots of change on the way. Sports betting needs the right audience and context. Building subscribers isn’t an easy thing to do!”
Andy Roberts, CMO of sports content specialist, Planet Sport commented; “This not a surprise, they wouldn’t be the first media business to try and fail in the gaming market either. There’s always this perception that bolting on betting and gaming is a licence to print money. It really isn’t. That is, at least in the early stages until you build scale to even out the ups and downs and leverage your house edge. Betting and gaming require a different mindset and experience. That’s why there are specialist gaming firms out there.
To a business that is more familiar with content and subscription revenue it really is a different ballgame. Sure, the concept of melding content with wagering is great in theory but you need to deal with a lot more than just turning it on and engaging your existing audience. For example, you need rock solid product propositions and robust pricing, trading, and customer management capabilities. You need marketing strategies to find the right sort of customers, not just those only interested in your sign-up bonuses. You need the stomach for results not going your way or the shrewd punters taking you on.
And you need to do all of this whilst maintaining a duty of care to you customer base and ensuring a safe gambling experience. Basically, betting and gaming isn’t a game for the faint-hearted – or for those seeking an easy investment play.”
However, until FuboTV releases more details in a November earnings call, we won’t receive clarity.
What the decision to close Fubo Sportsbook means for the wider industry – the view from Spike
Given the potential revenues, it seems surprising that FuboTV has decided to close down Fubo Sportsbook so shortly after publically reaffirming its commitment to the product.
The company’s decision will undoubtedly have wider implications for the growth of this sector. For example, companies such as Disney / ESPN, Fox, and DAZN have either recently launched gambling features or have announced their intention to do so.
If investors are hard to acquire and regulatory approval is hard to come by, then other players in the market may decide to follow suit. However, at the minute there are no indications that others are having second thoughts. After all, a session at ESPN’s second-annual Edge conference this week remains titled ‘ESPN Bet – we like our hand’.